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When the measure of success isn't found on the bottom line

Orchid loves contributing to the success of our end users. That’s especially so when their reason for being, and their measure of success, is about purpose rather than profit.

Here in Australia, November is the time many people’s thoughts start to turn to the upcoming summer holidays, Christmas shopping, and family get-togethers. It’s also the time of year that the services our charities offer tend to be in most demand.

This time last year we wrote about the support Sage and Orchid Systems have given to a very local charity called One Meal. More recently we wrote about Sage’s support for the much higher profile Invictus Games.

Today we will look at the charitable and Not-For-Profit (NFP) sector generally, and discuss how and why many of our partners have had success in implementing Orchid products for their NFP clients.

What makes NFP’s ‘special’

Easy, it’s the great work they do, of course…but that’s not the focus of today’s article!

From an operations or accountancy perspective, it’s easy to think of an NFP as “just another business”. At a superficial level that might be true enough - budgets to prepare, bills to pay, staff to manage, inventory to control. Scratch the surface, however, and there are often significant differences.

  • ‘For Profit’ organizations are accountable to their boards, shareholders or private owners. Their principal source of revenue is their customers, through the sale of goods or services.
  • NFPs, on the other hand, exist to benefit their customers, not to profit from them. They generally rely on other sources – perhaps a combination of government grants and private donations - for the bulk of their revenue.

When we think of NFPs we tend to think of charities, but there are other entities that also rely on grants or donations, and are not motivated by profit. Some that spring to mind are educational or research institutions, local or regional governments, and First Nation groups.

NFPs, and those other entities, have a high degree of accountability to their funders.

Those funders will expect to see a social return on their investment, and to be assured that their money is being spent wisely, if they are to keep the funds flowing.

The special status of these organizations, often including tax exemptions, also comes with regulatory oversight. That can be accompanied by onerous reporting obligations. This all has implications for the systems and processes they need to support their operations.

Where do Orchid products fit in?

Keeping funders and regulators informed of how and where contributions are being spent is always a priority, and often and challenge. More so when it comes to managing multiple special-purpose grants that need to be quarantined for use on specific projects.

  • Inter Entity Transactions has become a favourite with NFPs for this very reason. GL segments can be created at the fund or project level, allowing for highly granular reporting. Inter-entity loan accounts are kept in balance through the automated generation of due-to and due-from entries.

Protection of customer data is always critical, but when your customers are amongst our most vulnerable citizens, and your funders are governments, the stakes can be higher still. With ever-increasing interconnectivity, and high-profile data breaches being reported in the media virtually every day, the stakes have never been higher.

  • Extender can be used to add layers of field-level security, audit logging, and email alerting. It also provides a platform for bespoke customizations, such as workflows to support approvals processes, or real-time integration, e.g. for sharing critical data with external donor systems.

Managing single purpose grants, or being accountable to a diverse range of donors, also implies a requirement for highly granular budgeting.

  • Info-Explorer has proven popular with NFPs for ‘slice & dice’ analysis and top-down budgeting by fund.
  • Add Optional Tables and you have a tool for bottom-up budgeting - Excel spreadsheets can be used to roll-up decentralized budgets prepared by Fund/Project Managers, and the results can then be written back to Sage 300.

Maintaining all that data is one thing. Getting the right information to those who need it, when they need it, is another.

  • Report Runner and Process Scheduler have a role to play in keeping all those stakeholders informed, allowing you to automate the generation and distribution of key reports. (And let’s not forget the scheduling of more generic but no less critical administrative processes, such as data integrity checks, database dumps, backups, and posting of batches.)

We’ve focused on products that have a particular resonance with NFPs due to their quite specific business requirements, but many of them also use and benefit from our other Sage 300 add-ons, e.g. EFT Processing, Notes and Document Management Link.


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