Sean Hale will share seven of the top lessons from his 20+ years of helping nonprofits work smarter (not harder). This includes how to save thousands of dollars per year, how to engage board and management in finances, and leveraging technology.

Full Transcript:

– [Steven] You’ll hear a robot voice, but … All right. Sean, I got 3:00 Eastern. Is it okay if we go ahead and get this party started officially? 

– [Sean] Let’s do it. 

– [Steven] All right. Awesome. Well, thanks to all you for being here. Good afternoon if you’re watching live or good morning if you’re way out in the West Coast or out in maybe Hawaii or Alaska. And if you’re watching the recording, hope you’re having a good day, no matter where you are. We are here to talk about seven steps to a strong nonprofit back office. I’ve been excited for this one for a quite a long time, and the day is finally here. 

Welcome. I’m glad that so many of you have joined us. I hope you’re having a good day. I’m Steven. I’m over here at Bloomerang. And I got my window open. I can’t believe that we got the fall spring here in Indiana, but I’m excited. 

And we’re going to have some fun over the next hour or so. So just a couple of housekeeping items, just want to let you all know that we are recording this session and I’ll be sending out the recording as well as the slides later on this afternoon. So if you have to bounce early, or maybe you get interrupted, or you want to review the content later on, share it with a friend, don’t worry. 

We will get all that good stuff to you later today, I promise. But most importantly, feel free to use the chat box right there on your Zoom screen. We’re going to save some time at the end for Q&A, and we’d love to hear from you as we go along. So introduce yourself now if you haven’t already. 

I know a lot of you’ve already done that. That’s super fun. We’d love to hear from you. You can also send us a tweet if you want to use Twitter. That’s cool. We’ll keep an eye on that there. There’s also Q&A box. 

Don’t let it limit you. You can use any of those things. We’ll look at them, and we’ll try to get to as many of your questions before the 4:00 Eastern hour as we can. And if this is your first Bloomerang webinar, I just want to say an extra special welcome to you folks. We do these webinars every Thursday afternoon. Getting close to a thousand sessions here in our nine-year history. It’s hard to believe. 

But if you’ve never heard of Bloomerang beyond these webinars, what we’re most known for is our donor management software. That’s what Bloomerang is. That’s what we offer. And if you’re curious about that, you can check out our website. We’re pretty easy to find online. You can watch all kinds of videos, all kinds of goodies on there. So do that if you’re curious. 

But don’t do that right now. Wait an hour at least, because my buddy Sean Hale is joining us from beautiful Austin, Texas. Sean, how you doing? You doing okay? 

– [Sean] Doing great. Greetings, everybody, whether you’re in Austin or Texas, or I saw somebody from South Africa and a lot of other neat places. So welcome, everybody. Thanks for joining us today. 

– [Steven] It’s a diverse group, and now you’re international, Sean. I think I saw some Canadians, some Bermudans. We love the Bermudans, especially. 

– [Sean] That’s right. First person to chat in was from Bermuda, so. 

– [Steven] Excellent. Probably good weather there. 

– [Sean] I’m sorry I forgot about that lovely island out in the Atlantic. 

– [Steven] Yes. We love you Bermuda. But, Sean, you’re awesome. This was so great of you to be willing to do this for us. You’ve been blogging for Bloomerang quite a while. We’ve gotten to know each other, given some good advice out there. And, jeez, you all are in for a treat, because if you don’t know Sean, got to check him out. 

He’s been doing this for over 20 years. He’s been a CFO, a COO. Definitely understands the back office. That’s one thing I look for when I am searching for webinar guests, is they know what they’re talking about, and Sean is no exception there. He’s also got some awesome irons in the fire that I think he’ll tell you about. He’s working on a directory of consultants for fundraisers to go out and find the right consultant for them. 

Maybe he’ll still share a little bit about that at the end. But yeah, I’ve already taken away too much time, Sean. So I’m going to stop sharing my screen, and I’ll let you get going on your awesome seven tips, see if it works. 

– [Sean] Steven, thank you so much for that very warm welcome. Let me see if I can take the wheel here without crashing the car. 

– [Steven] Yeah. Looks like it’s working. 

– [Sean] Look good? 

– [Steven] Yeah. 

– [Sean] All right. 

– [Steven] Go for it, my friend. 

– [Sean] Sweet, sweet. Well, thank you, Steven, and thank you, Bloomerang, for inviting me here and thank you all 235 of you who are logged on to this who want to serve your nonprofits better, because that’s what this is really all about. Steven already did a great job of kind of giving you a little bit of background. My day job is as an independent consultant specializing in nonprofit administration. That comes after more than 20 years doing it as an employee. 

And really I love to help out with all pieces of the back office. So whether it’s finance, or HR, technology, operations, either I can help or I can help connect your nonprofit to the right person to help get it done. And that includes such things as strategic financial advice, which I’m hearing more and more nonprofits are really wanting to get somebody in there for just a few hours a month, not full-time. 

And at the end of the day, I’m very passionate about saving money and finding ways to work smarter rather than harder. So today, in this webinar, we’re going to be looking for ways that your nonprofit can save money. We’ll be looking at ways that your nonprofit can free up time. We’re going to seek to help you understand a little bit more about how you can engage your board and your staff in finances, and we’re going to start to think about how back office processes have an impact on justice, equity, diversity, and inclusion. 

So here’s our agenda really quick. And, of course, just a quick legal disclaimer, basically, please don’t sue me. This is good general information. But each organization is unique and would apply this in different ways according to their specific situation. So if you want to get kind of specific advice to your organization, that’s a different conversation from what we’re doing today. 

Today, general, good information. So let’s go ahead and dive in. Tip number 1, hidden savings. And there are thousands of different ways that nonprofits can save money, and pretty much every nonprofit has at least a few. And we’re just going to cover one example today to give you an idea about how you might start thinking about this for your organization. 

So let me tell you about the lazy vendor. And last year I got to work with a great nonprofit in San Antonio, very tech-forward staff, very serious about automation and about working smarter rather than harder. But they also had a little blind spot, and that had to do with one of their technology vendors. And the kindest thing I can say about the vendor is that they are a sloth. 

Definitely overpriced by like double what they should have been charging. And they also had very slow response times. It’s amazing that they have a pretty good market share here in Central Texas, but they give terrible service, especially to small and medium nonprofits. My suspicion is that they just pay attention to their big clients and let the other ones fend for themselves. 

So I helped this nonprofit identify and get connected to a responsive vendor, one that’s helping them save $12,000 a year, giving them better service with their technology needs, and one that’s trusted by a lot of local, small and medium-sized nonprofits. So I would encourage you after today to take a moment to think about your vendors. And certainly any contract that’s over $10,000, you should review that every few years. 

And sooner if you might be starting to think that maybe that vendor’s kind of lazy or otherwise unsatisfactory, because there are big potential payoffs to shopping that contract. Very often you can get much better service and save money by doing it. Tip number 2, using the right tool for the job. And, you know, when I was a kid, every time my mom would take us to the mall, because I’m of the generation that would go to shopping malls, every time we’d go to the mall, I would want to go to the shop that had the Swiss army knives in the window because they were awesome for my 8-year-old brain, right, because cool pocket knife. 

And what I really fantasized about was getting one of them that has like 100 blades on it, you know? That three inches thick and you can literally do just about anything with a knife like that, right? You could chop down a tree. You could even make furniture with a Swiss army knife if you wanted to. But I think we all know that it would take a really, really long time to do that, right, because we all know that if you really want to make furniture, ideally you’re going to get the right tools for the job, right? 

You’re going to use a woodworking kit, not a Swiss army knife. However — oops, there we go — when it comes to certain back office processes, it’s a little bit less instinctual for some of us than the Swiss army knife analogy. For example, QuickBooks, that’s a really good bookkeeping tool. For small nonprofits and small businesses, it’s number one and for good reason. 

Good reason they have a great market share and that’s because it’s pretty user-friendly. You can get a great discount as a nonprofit, through TechSoup. And it’s really easy to find bookkeepers who are familiar with it, right? What more could you want from bookkeeping software? So last year I was having lunch with somebody from a local nonprofit with good visibility and really good people. 

Come to find out, they were using QuickBooks as their CRM. And if you’re on this call today, you probably know what a CRM is or have an idea that like Bloomerang, that is a kind of CRM. It’s a donor database, right? And what that meant for this organization, that they were using QuickBooks to be trying to do what you would ask Bloomerang to do is that it would take hours and hours of extracting the data and massaging the data. 

And they certainly weren’t doing much of a job at all, except maybe in the back of their heads about things like touchpoints and moves management or having a sense of who their major donors were, connecting the dots between events and coffees and this, that, and the other. But they did come up with a workaround, which was they hired a second development staffer to help. 

And this person, their main job was pulling the data out of QuickBooks and trying to get into some kind of form where they could do a mailing and stuff like that. And I do not want to speak ill of this organization or throw anybody under the bus. Lots of really good people, lots of smart people there. Many of them have advanced degrees in their specialty, but they just weren’t experienced with finance and operations or development. 

So I helped get them in touch with a professional who helped them get onto a real CRM that could serve their needs. And now they’re a whole lot more productive. They’re able to do much better analysis of their giving, better communication with donors. You know, it’s night and day what having a good tool can do for you. And so the question I would encourage you to ask yourself is: Are you using the right tools at your nonprofit? 

If there’s pain involved, that’s a hint that maybe it’s time to look at those tools. Tip number 3 today is time is money. And just to be clear, I’m not suggesting that you start bringing a stopwatch to the office. I’m also not suggesting that you introduce timecards and certainly not suggesting that you start to micromanage your staff, right? 

All of those things are usually not part of the secret sauce of nonprofit success. What I do want to help you make sure you’re doing is that you’re using your time wisely. What do I mean by that? Well, has anybody here on the call today ever seen a nonprofit where the computers are being held together with duct tape and a prayer? 

Have you ever seen a nonprofit where they’re only using free or super cheap software? Has anybody here ever had to train themselves how to use the software and so they ended up muddling around rather than ever really mastering it? Have you ever seen a nonprofit where instead of having a single integrated system where the pieces all talk to each other, they had a dozen different systems and so if you had to update somebody’s email address or physical address, you had to enter it here and here and here and don’t forget over here? 

Has anybody ever seen a nonprofit where the tech support is do it yourself? So we’re going to do a quick survey, and we’re going to use the chat box for this. All right. I’m just going to ask a quick question. And, Steven, he’s going to keep an eye on the chat box. And so the question is: If you have ever seen one of those situations before, the duct taped computer or the DIY tech support, could you just type “yes” into the chat box really quick? 

Oh, my gosh. I can see the number growing. 

– [Steven] Getting a lot of yeses, Sean. 

– [Sean] Oh, my gosh. Are there any noes? 

– [Steven] Oh, I saw one. Good job to them, but it went really fast with all the yeses. 

– [Sean] They’re working at the unicorn nonprofit. We want to know where you are and … 

– [Steven] Yes, please. 

– [Sean] Yeah. Give that nonprofit a medal because that’s rare. Oh, my gosh, 91 replies. All right. So the good news is, is that this is totally solvable. Let me tell you about a time I helped a nonprofit. It’s a great organization, smart, dedicated staff, a blue ribbon board, lots of community respect and a big impact. 

But here’s the deal. All the staff were using laptops that they had received secondhand from a local grant-maker. So basically the grant-maker said, “This equipment isn’t good enough for our staff anymore. Hey, nonprofit, would you like it?” And by the time I got to work with them, they’d already had these computers for a few years. 

And so, as you might imagine, a lot of these laptops, they wouldn’t hold a charge anymore. They needed constant tech support. They were slow. They needed frequent rebooting. And this was sending a message to staff about the value of their time as well and contributing to morale problems. So what I did was I helped them connect the dots to really understand the lost productivity that that equipment was causing. 

And I was able to estimate for them that, conservatively, they were losing $1,500 every year for every employee in lost productivity. They were basically paying people to sit around and do nothing to the tune of $1,500 each per year while they were waiting for their computer to reboot. And when we compare that to new equipment, because we were able to eventually get new laptops for them for about 650 bucks a pop, those laptops paid for themselves in six months. 

They lasted. They’re actually still using most of them. Two to five years per new laptop. And this is really good for morale and it sends a signal to staff your time is important, right? Your efficiency and effectiveness is important. And, folks, many good nonprofits fall into this trap. And we have a lot of forces telling us, funders and just the history of nonprofits telling us that we’re supposed to martyr ourselves. 

That that’s what a good nonprofit looks like and that we’re supposed to save money. And that doing things like having a computer held together with duct tape is somehow saving money. But these are the kinds of problems where the fix pays for itself quickly. Do you have any issues like this in your nonprofit? And if it’s not literally the computer being held together with duct tape, is there something where maybe the organization has been penny-wise but pound foolish? 

Tip number 4, outsourcing. And, folks, if you’re getting great results out of your back office right now, this would be a great time to get up and refill your coffee. But I know many nonprofits who aren’t getting great results out of their back office. And one of the reasons for that is that they’re asking their administrators to wear too many hats. 

This is especially true in small nonprofits and very often in mid-sized ones as well. And so you have your administrative staff constantly changing gears between different duties and very different skill sets. And so many, many administrators that I know are constantly on the edge of burnout and this impacts their performance, it impacts their morale, and it also makes it very hard for them to stay up to date with best practices and emerging technology. 

So why would you want to stay current with best practices? Why would you want to stay current with technology, right? And definitely staying current with technology, it’s not for everybody. For some nonprofits, avoiding technology might even be core to the mission. For example, the Old Order of Amish Helping Program, they’re not going to be adopting QuickBooks or Bloomerang. 

Sorry, Steven. But most nonprofits should aspire to keep up with technology, right? But there’s a common dilemma for administrators, and that is how do you stay current on technology when you’re constantly on the edge of burnout? Many nonprofit administrators, and probably the majority of those that I know, they work long, intense hours just to cover the day-to-day routine. 

They’re constantly switching hats, right? And so it might be bookkeeping, and then it’s HR. Then it’s technology. Then they’re a greeter. Then they’re worried about office supplies. And that might just be the first hour of their day. And how is anybody supposed to stay up on trends in a dozen different fields anyway, right? 

And definitely there’s no time to stay up on in best practices when you’re burned out. And so as you might gather up, I’ve seen this a bunch of times before. I’m working with a new client on this right now. They had an office manager in the same position for about 20 years, and the staffing of the organization did not grow with responsibilities. And so this person, she wasn’t able to keep up with technology, and reports were getting later and later. 

They were incomplete. There were errors. The whole situation definitely wasn’t good for her morale, wasn’t good for her performance. And then she retired suddenly at the end of last year. So what are we doing to help this nonprofit get back on track? One of the things that we’re doing is we’re splitting up the functions. Instead of asking an administrator to wear a dozen hats, we’re working with this nonprofit to figure out what pieces would do better elsewhere. 

And certainly, there are things about the kind of core office manager duties, the very core bits of it, the general administrative duties that are very good to keep in-house where you need somebody who has an intimate knowledge of the organization and of the people. But then there’s bookkeeping, and this is something that we’re helping them get outsourced to a third party. 

It’s a professional firm, and all they do is work with nonprofits and it’s just bookkeeping for nonprofits. They do one thing. They do it well. And then we’re also adding in a key function that the organization really needs, which is strategic financial advice for just a few hours every month. And this is getting them high-level analysis, skills that they did not have in the skill set of the staff or the board. 

It’s getting a strategic thought partner for the executive director around finances and also helping the board out with the same kinds of questions. It’s giving them support they needed for putting the budget together and the audit and things like that. And, folks, at the end of the day, this is about not asking your administrator to be all things to all people and still do any of them well at the same time. 

It’s about moving from a horse to a Honda, or maybe it’s about moving from a jack-of-all-trades to somebody who can do great work, but with a reasonable, limited number of responsibilities because you can’t do a great job if you’re also doing everything. And so if your organization is ready to consider outsourcing some functions, I would encourage you to think about core responsibilities. 

Rather than this is the job description that we’ve been working from, but rather here are the 12 different things that are in that job description that really involve different skill sets, very often different personality types, different technology. And think about what is it like to try and do those when you’re an employee with 12 responsibilities versus a third party who just has to do one thing and then they do that one thing very well every day of the week. 

What’s accountability like when you have an employee who’s responsible for dozens of things versus a third party who’s responsible to you for one thing? When it comes to termination or replacement, employee versus third party and also staying current with technology, right? The ability of your employee, or maybe that’s you, maybe you’re the administrator on the webinar today, the ability to stay current with technology in a dozen different fields versus somebody who that’s their only job, right? 

And, folks, this is about saving money. This is about reliability. This is about using your organization’s limited funds wisely. Getting your back office strong so everybody else on staff can really keep their focus and attention on the mission, because that’s what we want is that 

[inaudible] and easily so that everybody else can be out there, out front delivering on the mission day after day, and they can’t, if … The executive director that we’re working with, this new client of mine has already reported to her board that she anticipates saving $15,000 this year because, again, they’re going to have better service, right, more timely reports, accurate reports, and strategic financial advice. 

I do have one P.S. for you on this particular item, and that’s that not all outsourced is better, right? You still need to check references, and you still need to remain engaged and evaluate their services regularly. Whether it’s bookkeeping or anything else, some people, some outsourced folks do it really well, some not so much. 

Tip number 5, pandemic pivot. So last year I got to work with a great nonprofit in New Jersey. And the pandemic, it forced there four staff people to suddenly start working [inaudible]. After talking, they were ready to consider some long-term changes. And I worked with them to see how they could learn from the pandemic and apply those lessons to save money. 

We saw them, that they had been burning through $30,000 a year for services that they had learned that they really [inaudible]. So we were able to strategize together and help them get to a place where they could get out of their rent contract a lot earlier than they might have otherwise. So we’re going to take another vote really quick. 

Steven, if you don’t mind keeping an eye on the chat and we’ll see what folks have to say. Folks, here’s your choice. And there’s a little bit of a setup here, so don’t vote yet. 

But question is: Would you rather have $30,000 a year in savings or a brand new $30,000 grant? But before you vote, think about [inaudible] versus annual savings versus an annual grant. Thinking about the work that goes into renewing the savings versus the 

[inaudible] versus a grant. All right. So now let’s vote in our chat really quick. Would you rather have savings, 30,000 bucks a year [inaudible]. 

– [Steven] It looks like savings is winning by about … 

– [Sean] I can even watch it adding. Maxed out at 99. 

– [Steven] I’m seeing maybe three out of four people say savings. That’s kind of what my eyeballs are saying to me, Sean. 

– [Sean] Okay, cool. Cool. So why don’t we at nonprofits, why don’t we ever talk about savings? What I’ve seen is that in these conversations, whether it’s board or staff, like it’s always $1,000 to close the gap. 

Why don’t we ever talk about, you know, ways that we can save money. And instead of finding [inaudible] to consider that there are ways that just about every nonprofit can keep the money they already have in their pockets. Tip number 6 is dashboards. 

And we’re going to move from saving money to engaging your leadership, because that is something that the back office has to do, right? It’s not an island that just lives in the basement and it has to be involved in engagement. And I have an important number to share with you today, 93%. Ninety-three percent of Americans, American adults have math anxiety, 93%. And so your financial reports, do they engage your board, do they engage your management, or did they possibly create anxiety that you might not even have known about? 

Is it acceptable that your financial reports might only be engaging 1 out of 14 of your leaders? A board’s number one job, you’ve probably heard this over and over again. The board’s number one job is their fiduciary responsibility. But how can they do that if they’re not engaged with the numbers, right, if they’re not engaged with that financial data? So on the screen right now, I have some numbers that could be detail out of a financial report from any sort of nonprofit out there, right? 

Isn’t this a whole lot better? It’s the same data but presented in graphic form, right? And this is the kind of thing that might help people see that, “Wow, the gala and the thrift store, they both seem to bring in the same amount of revenue, but one of them requires a whole lot more work than the other.” Or have conversations about, “You know, the annual gala, that’s a pretty significant slice of the pie for us. Are we sure we want to have the annual gala outside where it might get rained out?” 

Folks, a good financial dashboard, it’s going to supplement the detailed financial reports. It doesn’t replace them, right? You’re still going to need a balance sheet and a profit and loss statement. But these graphics help people engage with the key measures of financial health for the organization. With most financial dashboards, it’s going to be the same 6 to 10 key graphics every time, right? 

This particular one, it’s a nice way of helping people see that, “Yeah, you know, our cash did not do so well in 2020 due to the pandemic. But we’re anticipating that our cash is going to get better in the third and fourth quarter of this year.” Then you can have a nice conversation about, well, what’s going into those projections, right? Why are you optimistic about third quarter and fourth quarter? 

The dashboard is going to help improve the organization’s focus on what’s most important. We won’t take a vote right now, but I bet a lot of people on today’s call have been to board meetings and they’ve seen where time got wasted on something that really was not important in the financial reports, but the whole board went down a rabbit hole for 10, 15 minutes or longer, right? 

A good dashboard helps to keep the board’s focus up above the forest, right, which is where it needs to be 90% of the time. They do not need to go down rabbit holes unless they’re … you know, every once in a while they do need to get into the details, but most of the time they need to be seeing the forest and not worried about the trees. With this particular graphic, you know, that’s just a made-up nonprofit, and with this particular one, you know, they have four different programs around four different types of pets. 

But let’s say this nonprofit, they’re looking at having maybe a difficult financial time in the upcoming year. And normally everybody on the board, they want to talk about the horses because they love the horses, right? It’s a beautiful program. It’s a beautiful animal. But there’s another program that they should really be talking about, right, especially if they’re looking at going into a difficult financial year. 

The last thing I want to note here on dashboards is that they aren’t just for big nonprofits anymore. Lots of small and medium-sized nonprofits are including dashboards as a part of just how they do business with engaging their management and engaging their board. A lot of them are getting there by using fractional CFO services, right? They don’t need a full-time CFO, and they couldn’t afford it even if they did. 

But for 10 or 20 or 30 hours a month, they have somebody who’s able to give them professional financial advice to help them analyze their finances and to help them make good strategic financial decisions. My last tip today has to do with justice, equity, diversity, and inclusion. And if you didn’t understand it before, I really hope that 2020 helped make clear to you why this is important. 

And, folks, I’m no expert, but I do want to share something with you that I’ve learned and that you can apply to your nonprofit, because come to find out, what happens in the nonprofit’s back office can absolutely have an impact on justice, equity, diversity, and inclusion. And just because the good folks in the back office, they’re working with numbers and they have good hearts, that doesn’t mean that what happens in the back office doesn’t have an impact in this area. 

Just about every nonprofit has opportunities for improvement in this area, and I have just one example for you today, and that is our expense reimbursement policies. And, you know, this is the kind of thing where, you know, employees, they’re paying an expense on the employer’s behalf out of their own pocket. Sometimes this is something small, like getting coffee with a client, right? 

Sometimes it might be like going to a conference and, you know, the mileage to get to and fro or the airplane tickets to get there and the hotel room to go to the conference, maybe the conference fees. Sometimes direct expenses too for the organization. And then at the end of the month, they get all their receipts together, they create an expense report, and they present that for reimbursement. 

And sometimes they’ll get reimbursed within a week. Sometimes it can take longer than that. And, folks, let me confess to you, right, this was my default for years as a nonprofit administrator because I thought that this was just normal and the best policy. And like what’s the problem, right? Until I myself grew and learned a little bit and came to understand that defaulting to expense reimbursement wasn’t the best thing, right, and got to learn that we can do better. 

And new technology makes a much more inclusive policy so much easier than it used to be. So let’s compare, right, because really this comes down to you can reimburse the staff after they pay for it out of their own pocket or you can provide them with a credit card in the organization’s name, a credit card or a debit card so that the organization is … well, let me show you. 

With reimbursement, the employer, they’re basically borrowing from the employee, right? The nonprofit is basically taking out a short-term loan from the employee. With credit cards or debit cards, the nonprofit’s actually paying its bills directly. And, folks, the more I’ve gotten to understand this, the more I really come to understand that borrowing from the staff, that’s a really tricky, kind of thin ice sort of situation because of the power imbalance there, right? 

Many employees might not feel like they can even speak up if they’re not in a position to make a loan to their employer, right? With reimbursement, it disadvantages your staff who are from poor and historically marginalized situations. Whereas credit cards or debit cards, that’s a fair system for everybody. 

And I want to dig in here a little bit more with how this can really disadvantage individuals who might individually not have deep reserves to be able to make a loan to their employer or folks from historically marginalized communities, because we often don’t know who on our staff is financially strained. And somebody who might have been even in great shape months ago, things happen in people’s lives and they go from having a lot of extra funds to not so much. 

Eighty percent of Americans live paycheck to paycheck. Eighty percent of Americans live paycheck to paycheck. That’s an incredible number. And let’s add to that, that there are folks who have declared bankruptcy very often through no fault of their own because the medical system and the way it works in this country means that you can go bankrupt really quickly because of a medical emergency. 

And so through no fault of their own, they can’t even get a credit card, right, to be able to float a short-term loan to their employer. The reimbursement system, it can create shame and embarrassment for those staff who aren’t in a position to pay for that out of pocket. Imagine the shame if you can’t even afford a cup of coffee on your employer’s behalf. Credit and debit cards, those empower and those show trust. 

And so ultimately a reimbursement system, it discriminates and it excludes, whereas having credit and debit cards, that welcomes and engages your staff. I want to dig in just a little bit deeper here on the discriminatory part of that, because if your employee is not in a position where they can, whether it’s 5 bucks for coffee or pay 500 bucks for a flight to go attend this conference, what are they going to do? 

How many of them are going to skip the conference and not really tell you the reason why because they’re too embarrassed? How many of them might decline promotions because they know that with that promotion comes the obligation to also be spending out of pocket? And of all the different demographics, which folks are the ones who are most likely to get excluded this way? 

And it can happen without even you knowing because they might be too embarrassed to say anything. The good news is things have changed. Twenty years ago, trying to set up credit and debit cards for all your staff could be really cumbersome to get it set up and then the management. These days, the technology is in place that makes it super, super easy. 

There are some great options there. My favorite one is this great company that I’ve been working with. They provide as many cards as you want. Like literally, there’s a nonprofit that I have friends with here in town and I think they might have 50 or 80 different cards for staff, right? They’ll give you an unlimited number of physical cards. 

They’ll also create virtual cards … well, actually, you get to create your own virtual card. You get to go in and tell me, “Hey, send me a physical card for so-and-so” and you get to log in to the system and like, “I want a virtual card just for our Amazon purchases,” right, and it’ll be a dedicated number just for Amazon. This system has easy-to-control budgets and limits. And so let’s say normally, Terry, at your organization, they don’t usually need to do anything more than get a cup of coffee every couple of months. 

And so they have a $20 limit, right? But they’re going to go to a conference next month. And so you can bump up their limit for one month and bump it back down, and the whole thing takes like two minutes, right? And the system that I’m thinking about, that I’ve really fallen in love with, it has a free, built-in expense report tool. So instead of having the shoe boxes of receipts and all the problems that come with that, because the back office, at the end of the month, they have to chase people down like, “Where’s the receipt for this, and what was that expense for?” 

Instead, the staff people with the credit cards, all they need to do is have a smartphone with them. And so whether or not they’re going out to coffee or some other expense, when they make that purchase, they take a photo with their smartphone with the app, right? And then they code it really quick, right? Coffee with so-and-so, charge it to the X, Y, Z budget. They’re done. 

They can forget the receipt. They can lose it because they took care of their commitment to build that expense report in two minutes. And the back office is happy because they got the information, they got the receipt. They’re good to go. They have their audit trail. And if you haven’t made the switch already, you can. And what I mean by the switch is like these sorts of switches to get away from expense reimbursement. 

And whether it’s this or something else, most nonprofits have opportunities to make multiple back office improvements to enhance justice, equity, diversity, and inclusion. So let me give you a quick summary here. Hidden savings. What at your organization might be a starting point? Is it the vendor review or something else? 

Chances are you have opportunities to save money, meaningful amounts of money at your organization. Right tool for the job, right? What is your nonprofit’s hidden Swiss army knife situation? And would you even know if you had one of those situations? Time is money. And again, don’t bring in the stopwatch. But do you have any kind of computers in duct tape kind of situation at your nonprofit? 

Oops, those came out in the wrong order. Tip number 4 was outsourcing, right? Are you asking your administrators to be basically jacks-of-all-trades? And if so, are you really able to get the best out of them? Or can outsourcing help you take one or two of those responsibilities, get those responsibilities done well, and help that staff person also do a better job with a more reasonable, more focused number of things to do? 

Your pandemic pivot, this is the time to renegotiate rent, to renegotiate the copier, or any number of other things that you’ve been learning that you maybe don’t need anymore or need less of anyway, right? Dashboards. 

Are you creating financial dashboards to help engage the other 93% of your board and leadership? And finally, justice, equity, diversity, and inclusion, right? I wouldn’t ask anybody to try and get this, you know, get perfect on this overnight or maybe even ever, right? It’s more of a journey than a box that you can check. 

One great starting place, and there are many great starting places, but one great starting place can be your back office and making the switch from reimbursing staff to issuing them credit and debit cards. So it’s about time for questions and comments. Since Steven mentioned it earlier, I’m going to go ahead and give a 30-second mention to my side gig, because, you know, during the day I just gave you a sense of what I do. 

I help nonprofits with strong back offices. But he also mentioned that my night gig, my side gig is something called Philanthroforce, and I just dropped the URL into the chat box. And it’s a free service to help nonprofits find their next consultant. We’ve already listed. We launched, well, 12 days ago, and we have more than 300 consultants already in there with a wide variety of specialties. 

So I invite you to check it out. If you happen to be a consultant, I invite you to get yourself listed. And if you’re a nonprofit, please do check it out and consider using Philanthroforce so that when you are looking for your next specialist, you can fish from a broad and deep pool of talent instead of just depending on word of mouth, which is what most of us have depended upon for years and years. So that’s about that. 

Please do reach out to me if you have any questions that we can’t get to today. My email address is on the screen, and for those of you who it might be too small to read, sean@seanhale.org. And I’ll be happy to talk to you about, you know, any of the topics we covered today, administrative functions in your back office, whether it’s finance, operations, HR, technology, and help you get connected with the right solution, whatever it is, so that you can go back to focusing on your mission. 

And with that, it’s time for Q&A. 

– [Steven] Yeah. Thanks, Sean. This was awesome. We got a lot of good questions already, but if folks have not asked one, go for it. We’ve got probably maybe 10 or 12 minutes for questions. Sean, what was that credit card company that you were recommending? I think maybe your audio dropped out when you said the name. 

It was just an unlucky Zoom glitch, but would you mind repeating? 

– [Sean] Yeah, yeah. Thank you for asking. The name of the company is Divvy, D-I-V-V-Y. 

– [Steven] I thought that’s what it was. We use Divvy at Bloomerang. It is awesome. I mean it does … 

– [Sean] Isn’t it? 

– [Steven] Yeah. It … 

– [Sean] Do you miss having shoe boxes full of receipts? 

– [Steven] No. And we had company cards and … for people who are … Forget it. Yeah, you all got to check out Divvy. It is D-I-V-V-Y. 

– [Sean] Yeah. And for anybody out there, I happen to have somebody at Divvy who is a wonderful salesperson and they’re not going to be calling you up three times a week or doing any kind of hard pressure sales. So if you would like kind of a backdoor into Divvy, where you’re going to have the soft sell and low pressure, just reach out to me and I’d be happy to make the connection after the call. 

– [Steven] Yeah, and we’re not getting … We don’t work for Divvy. We don’t get any kickbacks or anything. At least I don’t. Maybe you do, Sean. But yeah, just a happy user here. I figured that’s what it was as you were describing it. 

I bet that’s Divvy. I bet that’s Divvy. So I’m happy to hear that. 

– [Sean] Yeah, yeah. There are a few others out there that do things that purport to be similar. I haven’t kicked tires on all of them. But I can tell you that I like Divvy and that a number of local nonprofits have signed up and they all love it too. I’ve only heard good things. 

– [Steven] So lots of questions around dashboards, specifically, Sean. Do you recommend a tool? Is that something that maybe your CRM should do, or do you know some standalone things that people use for dashboards? 

– [Sean] Yeah. Certainly, there are different ways to get there. And certainly, the fallback, the easy fallback is you build something in Excel, right? That’s the most common thing is that you decide what are our five, six, seven, eight most important measures of financial success? And then, you know, you know where to pull that out of your balance sheet and your profit and loss statement. 

But there are tools out there that people are starting to do. I actually know some folks who are developing — it’s still in the beta stage – one that plugs into QuickBooks and it’s for nonprofits, but it’s still getting beta-tested. There are … QuickBooks doesn’t have one yet. 

I know that for like nonfinancial metrics, Bloomerang does have stuff like that, right, where you have a dashboard, which … Yeah, folks, if you don’t have a dashboard like for your donor data and stuff like that, you should expect that. So check out Bloomerang if you haven’t. But whoever you go with, you should expect that because you got … that’s a much better way to engage with the data than numbers. 

– [Steven] Absolutely. Yeah. Most reputable CRMs will have something, right? So, cool. I love the DEI angle, Sean. I mean, people who follow Bloomerang and me and our webinars know we’re passionate about that. I had never considered the expenses and the reimbursement to be a DEI issue. 

That makes complete sense. How do you recommend maybe rolling that out? I mean, you mentioned it being a journey, you know, for people that maybe they’ve got a bunch of these credit cards, and there are a lot of people in the chat that were commiserating about being in that scenario where they are waiting to get reimbursed. 

What about for the leaders or maybe the managers on the call who maybe you have opened their eyes and they want to start down that path? 

– [Sean] Yeah, yeah. Well, you know, it’s … Fortunately like, you know, ideally every organization is already engaged with or will engage soon in some sort of organization-wide DEI for JEDI, right, justice, equity, diversity, and inclusion process. But even if you haven’t begun down that road, there are certain things that like they’re good, it’s good for you to fix them anyway, right? 

Like now that you understand that expense reimbursements can be unwittingly harming your team and hurting trust and holding the organization back, like why wouldn’t you fix that, right? And so, certainly, like it can be, you know, some organizations, they have to run that by their board. Very often, they at least need to have the board vote to open up a new credit card. 

But, you know, put some measure in front of the board, like the board hereby resolves to allow CEO so-and-so to open up an account, a credit card account with Divvy. That’s done and empowers the CEO to take the ball all the way, the rest of way down the field, right? 

Most boards should not be involved in that level of stuff unless the credit card or the bank requires that. But then it’s really, you know, it’s working with the staff. And let me … For any of you who have doubts about this kind of thing, it was a really great lesson for me. One of my colleagues, their organization is a local blood center, and they adopted this about a year and a half ago. And my colleague, like, you know, she’s about middle of the road with technology, and it kind of got dumped in her lap by somebody higher up in the organization, like, “We’re doing this.” 

– [Steven] That never happens. What … I never heard … 

– [Sean] Yeah. And so at first she was like, “Well, what is this?” But ended up that within … You know, every organization has late adopters on things. Within like a week or two of them like flipping the switch on it, even their latest adopters, their biggest curmudgeons in the organization said, “Oh, my God, I’m so glad we did this.” The people who hate technology said, “Oh, my God, this is so much better. I’m glad we did this. Thank you, thank you, thank you.” 

Right? Like when do you ever have that with a technology solution? And so, no, I just, you know, certainly do due diligence with all things, right? I’m not here to tell you that Divvy or anything is perfect for every single organization and every single circumstance. But get that conversation started and know that this is improving and making progress on JEDI. 

It’s more about eating an elephant, right? And, you know, the way that you eat an elephant is one bite at a time. Pick something, and if you can, pick something that’s going to be a visible victory for all the staff. That’s the nice thing about like making this kind of switch, is pretty much all the staff will see it, everybody will feel it, they’ll get it. And even if they personally weren’t worried about money out of their own pocket, they’ll probably like the convenience of not having to keep track of receipts, right, and just kind of click, click, click, upload, be done. 

– [Steven] I like the idea of starting with the board. I mean, if you get the buy-in from the top. 

– [Sean] Yeah. Well, if you have to. Like this is one where … It depends on your organizational dynamics. I’ve had a lot of experience with boards that are too involved in the day-to-day, so. So that’s a whole different webinar. 

– [Steven] That’s another webinar. 

– [Sean] You guys have probably had a few of those. 

– [Steven] Yeah, we’ll have more too. 

– [Sean] Once you get to like a $2 million, $3 million budget, the board ideally is not doing anything but rubber stamping that kind of decision. 

– [Steven] Right. You know, as you were talking … 

– [Sean] Hi, Jane Baxter Lynn. 

– [Steven] Yeah, we’ve got some awesome comments in here. So keep them coming. We got a few more minutes. You know, Sean, as I was listening to you, especially talking about like equipment and old computers, you know, I couldn’t help but think of the old word “overhead.” Maybe some other people were. And a lot of people are asking about getting donors to cover admin costs, which are typically not as exciting as water wells and puppies and things that are going right to services. 

And listen, I’m married to a fundraiser. I mean, I believe in admin costs, but it’s a challenge. Do you have any experience presenting that as a funding option to people specifically? 

– [Sean] You know, you can … I think you’re right. That can be a hard sell, right? Like puppies versus new laptops, that’s a harder one. But here’s the thing. There are so many of those investments that even if you can’t find a third party to fund it, you should do it anyway because it pays for itself, right? This is going to pay for itself in six months. 

Why would you take six months to go out there and raise the money for it, right? 

– [Steven] Yeah. It makes sense. 

– [Sean] Like find the money and do it, because if it’s going to pay for itself in six months, right, you kind of … like why would you not? And if people are hesitant, that’s where stepping back and helping them to connect the dots, right? Like, yeah, these crummy old machines, it’s not just that staff are kind of like twiddling their thumbs a little bit. 

It’s $1,500 a year, each of them, that they’re losing in productivity. You know, a week, for some organizations, that’s a whole full-time position. 

– [Steven] That make sense to me. Don’t wait. 

– [Sean] Is our workaround hiring another person for$ 40,000 or $50,000 a year, or is it investing in new equipment for folks that’ll last us 5 years? And so when you spread that out over time, it’s only 150 bucks a head. 

– [Steven] Yeah. Not to mention it helping maybe with hiring, retention, and recruitment. Yeah, so many other benefits. 

– [Sean] A lot of nonprofits have retention issues, and poor equipment contributes to that. Poor tools contribute to that. And turnover is crazy expensive. Depending on the position, that turnover can cost you anywhere from 50% of the annual cost of that position to 200%. And that’s a really heavy price to pay, especially when for 650 bucks, you can prevent it. 

– [Steven] I love it. Let’s talk outsourcing. Some people are asking, what are some things that are kind of an ideal go-to for outsourcing? And I know everybody’s different. But are there things that maybe everyone should at least consider outsourcing, or does it really differ from organization to organization? 

– [Sean] One, there are a couple of them that I think most organizations, not all, but certainly bookkeeping for many organizations to a good third-party firm that specializes in nonprofits can really make all the difference, because those are the ones who are going to bring the technology and the efficiencies, and they’re going to be on top of it, right? 

They make money when they figure out how to get your stuff done accurately and quickly and when they can get your books closed and done well, and when you’re not having to go back to them and all that other stuff. And it’s really hard for a staff person who only does that for 20 hours a month or even 40 hours a month to do well. IT is another one. And I’ve seen too many nonprofits where one of the administrators is the accidental tech person because they happen to know three things more than everybody else, right? 

Or they’re just curious about it. But that’s totally different from them actually being able to help you make sure you got your security covered and your machines up and running at peak efficiency. And if the internet goes down, if that person’s already wearing 12 hats, can they drop that other stuff? Can they say, “Yeah, like payroll is not going to happen until next week because the internet is down”? And so IT is one where good outsourced IT can also pay for itself really quickly because everybody is able to stay productive. 

And even if like … An organization I once helped, it used to be, you know, if somebody’s computer went down, like it might be a day or two where they were twiddling their thumbs while the front desk person, this was one of their dozen things that they did, right? They were like in charge of the kitchen and in charge of the photocopier and in charge of all the IT in between all the other stuff. And like, it was crazy. 

– [Steven] Yeah. That doesn’t make any sense. That’s great. Yeah, a lot of people are chiming in accounting and IT. Big morale boost, Scott says. I love that. What about when you start that process? 

There’s a good question here from Bruce about, you know, you start to outsource, but in those early days, it seems like the person who was doing that work previously is still kind of doing it in the course of onboarding that outsource person or firm. Any advice for that, because I feel like people, maybe they bring that on and it’s like, “Oh, geez, this is more trouble than it was worth. I’m actually doing more work.” 

Until they get over that hump. Any pep talk for them to, you know, stay the course until that turns over? 

– [Sean] Transitions are important. And sometimes they’re … And there are a bunch of reasons why transitions can be painful. And sometimes it’s pain you have to work through, and sometimes we have to stop and reevaluate, right? So I can’t give a blanket answer, but I can tell you that, you know, doing good work upfront can help prevent and reduce that. 

And so, when you’re bringing somebody on, a third party, like, have you thoroughly checked their references and have you thoroughly walked through all the different kind of key components and have you gotten a clear sense of what onboarding means for them? And then your staff person who might be giving that up, how are they feeling? Sometimes staff people have a hard time letting go of stuff. 

That’s one kind of conversation and process. That’s different from a situation where they’re not able to get themselves out because maybe the people who are taking over, maybe they’re not as good, or there wasn’t a clear onboarding process or any number of things. So having clear conversations involving your staff person in that and setting clear dates also, right? 

So yeah, “Terry, by March 31st, I need you out of here.” And if people come … And actually, this can be really hard. When people come to you for tech support, you know, I know it’s hard for you to say no. And so as the CEO, I’m telling you, I am ordering you to tell them, “I’m sorry, the boss said I can’t help you with that anymore. You have to pick up the phone and call tech support.” 

That’s going to be a really hard habit for staff to break, is to stop going to the internal person and to start picking up the phone or sending an email to their tech support. And so that can take months or years, and it really depends on the people internally, who used to be the go-to people saying, “I can’t help you with that anymore. And I would love to help you.” 

Like CEOs or whoever’s in charge of this, you might have to give them direct orders and give direct orders to everybody that going to Terry has to stop. And, yeah. Does that make sense? 

– [Steven] Yeah, I love that. 

– [Sean] I hope. 

– [Steven] You know, people who work at nonprofits, like you said, tend to be people that will step up and do whatever needs to be done. And that can be hard, but yeah, give them the freedom to say no. It’s very important. And there’s been so many good nuggets in this one, Sean. There are so many angles that I didn’t expect to be a part of the conversation that now make complete, total sense and logical sense to me. 

And I kind of feel bad that I didn’t see them in those lenses before. So thank you. This was a lot of fun to listen in on. Thanks for being here, Sean. Any last words before we adjourn before the top of the hour? 

– [Sean] No. Thank you. Thanks to the … At one point we had north of 250 people on the call, so thank you all for caring about your nonprofits and wanting to get your back office processes into a better place. So, you know, yeah. Thank you, Steven. Thank you, Bloomerang. 

Thanks to everybody who’s on the call, and folks, feel free to reach out to me if there’s anything that I can help you with. 

– [Steven] Yeah, please do. LinkedIn, Sean Hale. Easy to find on LinkedIn. And keep an eye on that consultant website too. We’ll send some information out about that because that may be a really good … I think that will be a good resource for people here real soon. 

– [Sean] Thank you. 

– [Steven] And thanks to all of you for hanging out. I’ll echo those sentiments. You know, I know it’s always hard to carve out an hour in your schedule to listen to a webinar. So I’m so happy that so many of you did that. And we’ve got a good one coming up next week, same day, Thursday afternoon, a little earlier, 1:00 p.m. Eastern. But my buddy, Diane Leonard, is going to be on to talk about the Agile framework. 

Do you know what Agile is? I kind of do. I think our software developers here at Bloomerang use Agile. So I’m going to be listening in intently to learn more. I think it can be a good way for folks to maybe be a little bit more productive. So interesting dovetail from this presentation. We always try to plan things that way. 

But that’ll be a good one. Diane is awesome. She’s one of my buddies, and I don’t think people will be disappointed after that one. So 1:00 p.m. Eastern next Thursday. If you can’t make it, don’t worry. We’ll record it. 

Register anyway. Even if you know you can’t make it, you’ll get the recording literally a couple of hours later. Speaking of recordings, I’ll get the recording of this one out too for all of you who attended or didn’t attend who aren’t going to hear me say that because they’re not here. But, anyway, I will get that to you all. Give me a couple hours and there’ll be an email from me with all those goodies, and hopefully we’ll see you again next week. 

So we’ll call it a day there. Have a good rest of your Thursday. Have a good weekend. Stay safe, stay healthy, and we’ll talk to you all again soon. Bye.

Kristen Hay

Kristen Hay

Marketing Manager at Bloomerang
Kristen Hay is the Marketing Manager at Bloomerang. From 2018 - 2020, she served as the Director of Communications for the Public Relations Society of America's local Hoosier chapter. Prior to that she served on several different committees and in committee chair roles.
Kristen Hay