The Good, The Bad, The Ugly

1
The Good, The Bad, The Ugly

• Session C-5
• November 12th, 2003
• 330 500 PM
• Lisa F. Rau

2
Agenda

• Introductions
• The Good
• The Bad
• The Ugly

3
Introductions Lisa Rau

• CEO and co-founder, Confluence (www.confluencecorp
  .com)
• IT services firm providing support exclusively to
  the nonprofit sector most are community-based
  organizations
• 20 years of experience in the IT support
  services industry
• Consultant to over 100 nonprofits on technology
  initiatives
• Frequent consultant and invited speaker on IT
  planning, IT budgeting, fundraising for IT, and
  IT-related capacity building
• VP on the Board of the YWCA of the National
  Capital Area
• Computer Scientist (BS, MS and Ph.D.)
• Peer Reviewer, for MD Nonprofits Standards of
  Excellence Program

4
Recent and Upcoming Presentations

• Lutheran Financial Managers Association, New
  Orleans, LA, 9/29/03, Best Practices in
  Budgeting for and Acquiring IT A Comprehensive
  Compendium of Resources, Tools and Tips for
  Nonprofits.
• National Technology Enterprise Network Regional
  Conference, Washington, DC,10/23/03. How to
  choose a vendor.
• Council on Foundations Technology Affinity Group
  Annual Meeting, Washington DC,11/13/03. Network
  Operating Systems.
• Maryland Association of Nonprofit Organizations,
  Columbia, MD,1/15/04. IT Tools, Tips and
  Resources.
• Support Center for Nonprofit Management (New
  York),2/19/04. Fundraising for Information
  Technology (AM) and Increasing your Internet
  Presence (PM).

5
Confluence Quick Facts

• Founded 3/01 by Lisa Rau and Jeff Sullivan
• Certified as a VA Womens Business Enterprise,
  and DC LSDBE
• Offices in DC (1111 19th Street, NW, Suite 900)
• Over 110 customers as of 10/03
• Over 25 full time staff and consultants
• Confluence averages two new customers per month
• 98 customer retention rate
• 99 of our work is for the nonprofit sector
• Customers span ten states with most in DC metro
  area
• Confluence rated 6 in Circle of Community
  Investors at 2002 Washington Business
  Philanthropy Summit

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Services Breakdown
7
Sample Customers
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The Good

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The State of Technology in the Sector -- Objective

• Grantmakers Information Technology Survey Report.
  315 foundations completed the survey in April
  2003.   www.tagtech.org
• Michigan Nonprofit Technology Survey -
  information technology perceptions, capacities,
  and needs of nonprofit organizations in the state
  of Michigan. Comnet.org/techsurvey
• Nonprofits, NTAPs and Information Technology,
  January 2003. Survey sponsored by N-TEN.
  www.nten.org/reports
• Art Practice of Technology Consulting Survey
  Summary (bethkanter.org/consult/responses.pdf)
• Gifts in Kind 2001 Charity Technology Tracking
  Survey
• Nonprofit Management Fund Software Survey
• Maryland Association of Nonprofit Organizations
  Technology Survey
• Independent Sector The Impact of Information
  Technology on Civil Society How will online
  innovation, philanthropy, and volunteerism serve
  the common good?

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The State of Technology in the Sector --
Subjective

• The sector is experiencing a digital divide
• The true impact of the Internet is in building
  community
• Strengthening relationships with current
  audiences
• Reaching out to new audiences
• Easy to use interfaces for distributed data input
• The effective use of technology will require
  long-term collaborations with nonprofits,
  for-profits and funders
• Lack of sophistication in IT management, and IT
  purchasing, employee use of computers and
  technology (training)
• Lack of recognition that IT is an executive
  function

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The Good

• How technology works for us
• Common technology applications and elements of
  infrastructure that work well for us
• Commercial software systems
• Internal IT initiatives
• Communications
• Nuts and bolts desktops, servers, networks,
  Internet access, email

12
Software Applications Easy

• Accounting Systems
• MIP, Blackbaud Financial Edge, Great Plains,
  QuickBooks, Nonprofit Books, Solomon
• 15-20K
• Fundraising Systems
• Raisers Edge, DonorPerfect, Giftmaker
• www.npowerseattle.org/tools/donormanagement.htm -
  Consumer Guide to Donor Management Software
• Free - 30K
• Web Site Tools
• Web / photo editing tools
• Content Management Systems
• Payroll systems

13
Software Applications Harder

• Software
• Client tracking systems
• Case Management Software
• Child care management
• Strategy
• E-Advocacy
• Integration customer relationship management
• Hard because
• Choice confuses
• Expertise is involved that may not be present
  within agency
• Underestimation of totality of project
• Ensuring path chosen will meet the needs of the
  agency

14
Internal IT Initiatives that Succeed - Training

• Bring all employees up to common proficiency
• Continuous to account for new jobs, turnover
• Increases retention and morale
• Big efficiency and effectiveness bang for the
  buck
• Helps if leadership believes that training is a
  worthwhile investment
• Ensure there is a training budget
• Classroom training (75 - 500 per person per
  course)
• Custom Training (500 ½ day)
• On-line / web enabled training

15
Internal IT Initiatives that Succeed -
Communications

• Communications Concepts
• With field offices
• To facilitate / enable remote work / telework
• To communicate with constituents
• Internally among staff
• Remote Access Technology - Virtual Private
  Network (VPN)
• Built-in to Windows 2K Server OS (Routing and
  Remote Access Server (RRAS) download
  preconfigured VPN connection to each remote
  desktop / laptop
• Firewall / VPN appliances
• SonicWall / Cisco
• Citrix / Terminal Services
• useful for multiple simultaneous connections and
  application sharing
• Citrix runs in conjunction with Windows 2000
  Terminal Services to include more client
  platforms, improved bandwidth, enhanced security,
  load balancing, etc
• Remote access to email
• With MS Exchange use Outlook Web Access
• With POP3 accounts, check box in Outlook leave a
  copy on the server and use webhost email access
  or www.mail2web.com
• PC to PC - Gotomypc.com or PCAnywhere

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Internal IT Initiatives that Succeed
Infrastructure / Technical

• Updating hardware software
• Windows automatic updating download from
  Microsoft web site
• www.microsoft.com/Windows2000/downloads/recommende
  d/susclient/
• Organization-wide standardization of systems
• Ensure standardization results in savings
• Standardization requires standards
• Standards comes from top-down
• Speed of current hardware vs. cost of upgrading
• New computers will last longer then ever before
• Anything under 500 MHz is candidate for
  replacement
• Computers are very inexpensive now
• Rule of thumb if cost of upgrade is 50 of more
  of cost of new equipment, buy new equipment
• Exploit warranties and maintenance agreements for
  all hardware, software and services

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Internal IT Initiatives that Succeed - Security

• IT compliance (HIPAA)
• Many workshops around this
• Many practices devoted to help (i.e., Price
  Waterhouse Coopers)
• Improving IT security
• Perform a security assessment / audit
• Develop appropriate policies and procedures
• Developing an integrated Information Management
  System that addresses security and
  confidentiality developing IT policies and
  procedures

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Sample Policies

• 1. ORGANIZATION AND RESPONSIBILITY
• Organization Policies
• Organization of Manual
• Responsibility for Standards
• 2. DOCUMENTATION
• Documentation Policies
• Project Documentation
• Applications Documentation
• Program Documentation
• RESOURCE MANAGEMENT
• Requesting Service
• Service Request Procedure
• Storage Management
• Requests for Storage
• File Management
• File Permissions

• Employee Training
• 9. CONTRACTING WITH VENDORS
• Policy for Contracting for
• Outside Services
• Consulting Service Contracting
• Contract Personnel Acquisition
• 10.APPENDICES
• MIS Organizational Chart
• MIS Job Descriptions

6. MANAGEMENT AUDIT Audit Policies MIS Systems
Audit MIS Management Audit 7. HUMAN RESOURCE
MANAGEMENT MIS Personnel Policies Recruiting
and Job Search Selection of MIS Personnel
Testing for MIS Personnel Employment Interview
Performance Review Employee Termination 8. MIS
EDUCATION AND TRAINING MIS Education and
Training Policies New Employee Orientation
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The Bad

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Overview

• Why good projects go bad
• Funding
• Preplanning / requirements analysis
• The procurement process
• Integration challenges

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Why good projects go bad

• Lack of resources
• Inadequate pre-planning
• Unsophisticated procurement processes
• Inappropriate solutions
• Videoconferencing
• Just dont
• Get high-quality speaker-phones and appropriate
  for use
• Consider headsets
• No one calls in from cell phones

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Support / Funds - Resources

• Would your organization accept a broken
• Phone system / voice mail, copier, Email /
  Internet access
• Money gets spent when it is
• Required
• Preventative maintenance prevents wasted money
• Prioritized
• Need champion in organization or a forcing
  function
• Budgeted for
• Ensure your proposals and budgets include the
  resources for upgrades and keeping pace
• Things happen may as well plan for them

23
Capacity Building - Funding

• Getting funding requires knowing how much you
  need and for what
• Proposals to requesting funds (existing or
  proposed new) should demonstrate that the project
  pays for itself
• Qualitative and / or quantitative analysis
• If it doesnt, why do it?
• Proposals should frame requests solely in terms
  of mission
• Sometimes still wont work i.e., if you need
  new equipment and they wont fund equipment
  then try juggling funds
• Look at descriptions of grants to see examples
• That being said
• IT is not a one-time expense every organization
  should have a budget for it

24
Pre-planning

• The hardest part of any IT initiative is deciding
  what to do
• The how to do it the technology part is
  straightforward
• Consultants can help
• Forcing function something wonderful will
  happen
• Methodical
• Big picture view
• Considerate of organizational implications for
  any initiative
• Broad and deep knowledge of the state-of-the-art
• Expertise on what works
• Independent view
• Consultants are often heard more than internal
  staff
• Staff open up more to outsiders who guarantee
  privacy
• Second opinion and Unbiased and fresh perspective

25
Requirements Analysis

• The broader the staff input (and potentially
  boards) the better the end result
• It is OK to state outcomes in functional, not
  technical terms
• Write down the results of your analysis
• Prioritize
• Incorporate into RFP

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Developing a concept of operations

• What systems must talk to each other
• What functions make sense to group into single
  products
• Familiarity with market space
• Cost / benefit analysis
• Among different concepts
• Buy vs. build
• Its only after this process that an accurate
  project cost can be developed
• Two-stage projects are almost always appropriate

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The Procurement Process

• Request for Proposal
• Questions and Answers
• Down-Select to Finalists
• Interviews
• Selection
• Negotiation
• Project Implementation and Management

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Requests for Proposals

• The proposals you receive are a direct reflection
  of the RFP you issued
• Provide
• The specific information you want from each
  vendor, in what order how proposals should be
  submitted,
• The evaluation criteria it should be complete
  and measurable
• Whats wrong with this Proposals will be
  evaluated on all appropriate criteria, including,
  but not limited to, cost, experience and support
  offered.
• Timetable and schedule
• Dont ask for information you dont need or wont
  evaluate
• Process for QA
• Costs should be clear and broken out
• into tasks / subtasks

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Evaluation Criteria

• Components to weight
• Capabilities of specific individuals
• Corporate Expertise in this area
• References and Prior Experience
• Technical approach
• Understanding of requirements
• Cost
• The quality of proposals is often an indication
  of the quality of the work
• Work must be broken into phases with visible
  milestones
• Evaluate credibility and reliability first

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Questions and Answers

• Do not let on who the other bidders are
• Use Bcc if emailing all vendors at once
• All questions should be submitted in writing by a
  certain date
• All questions and all answers should be responded
  to in writing to all respondents
• Ensures a level playing field

31
Down-select and Interviews

• After receiving the proposals
• Now it is time for you to ask questions back
  give the vendors one chance to make it right
• CRs (Clarification Request) and DRs (Deficiency
  Reports)
• Price comparison requires apples to apples low
  bid is as dangerous as high bid
• Make a matrix with your evaluation criteria in it
  and score the responses
• Get a committee together to make the decision
• Consider bringing the vendor in for an in-person
  interview
• CRs and DRs can be handled through this oral
  process
• Make sure the company knows what kind of people
  to bring
• Often, the it is clear who the winner is
• the selection is obvious

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Hiring Technical Support Best Practices

• The specific individuals assigned to do the work
  is the biggest contributor to project success
• You get what you pay for
• The hourly rate fallacy
• But how MANY hours at WHICH rate? Is travel time
  included?
• Past performance is the best predictor of future
  success
• Check references last 5, not their choice
• Get resumes for the specific individuals who will
  be assigned
• Look for the real thing not someone who learned
  technology on the side
• Academic degrees or technical training
• 2 years on-the-job, relevant work experience

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Negotiations

• Dont pass up the opportunity to negotiate
• Terms of contract
• Price and payment
• Develop a web of relationships
• Technician and organizational point of contact
• Business managers
• Executives
• Contracts are there to protect your organization
• Non-solicitation - Nondisclosure
• Insurance - Payment / Billing
• Arbitration
• Intellectual property / ownership
• Escrows
• Lock-in future escalations

34
When you run into problems

• Dont hesitate to surface problems early
• Often, the firm doesnt know there are problems
  they arent mind readers!
• The best performing vendor is one who thinks they
  are about to be fired
• Suggest specific fixes i.e., replace the
  assigned technician
• The hardest decision to make is to cut your
  losses
• If outcomes are not achieved you MUST ask whether
  to continue
• Avoid blame and move on proving fault is very
  difficult in IT

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Integration Challenges
Your Case Management System
2000 2001 2002 2003 v1 v2 v2.5 V3
Your Financial System
2000 2001 2002 2003 v3.2 v3.3 v5.0 V5.4
Server Operating System
Windows NT Windows 2003 Server
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Integration Challenges

• Upgrades and maintenance never end
• Some systems to be integrated may be beyond your
  control
• The effort to get two disparate systems to talk
  to each other is a major project in its own right
• Standards can help
• Association of Information Referral Specialists
  XML based protocol for data interchange in
  social services
• Piloted to created regional 2-1-1 systems
• Mandates can help Homeless Information
  Management System

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The Ugly

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Intractable Problems The Ugly

• The seemingly prohibitive price
• What are your organizations barriers to using IT
  to enhance efficiency and effectiveness?
• Cultural issues
• The difficulty in effecting organizational change
  required by new business processes
• Other organizational rather than technical
  reasons
• Cultural issues are the most difficult problems
  to solve. Ways to change culture
• Leadership
• Organizational structure
• Individuals

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The Ugly Changing Leadership

• Difficult problem to solve
• Organizations tend to exhibit characteristics of
  their leaders
• Consider getting an external assessment
• Provides independent view 360 is popular
• Done by experts many can act as coaches
• Includes a prioritized action plan with budget so
  its easy to take the next steps eliminates
  being paralyzed
• Cost money, so is (for better or for worse) more
  likely to be used / paid attention to
• Wage a campaign / Grass roots effort
• The surround theory

40
The Ugly Changing Organizations

• Organizational structure can facilitate or impede
  undesirable behaviors
• Form follows function
• Models of organizational structure
• Traditional stovepipe with departments
  reflecting functional / program areas
• Matrix model pool of individuals dynamically
  attached to programs as they come and do
• Centers of Excellence identify key areas all
  groups draw from for common needs

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The Ugly Changing People / Processes

• For the most part, people dont change
• Carrot and stick should work but rationality
  doesnt always rule
• Over time, new people can infuse an organization
  with new values
• New employee orientation as vehicle for change
• Systems must be deployed in organizational
  context
• Revisit business processes that software can or
  should change
• Cross-disciplinary teams should be considered
• Often in software selection, perform gap
  analysis gap between what system does and what
  it needs to do
• Can customize software to match prior ways of
  doing business or change way of doing business to
  match software

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Ensuring IT project success

• People can thwart even the best conceived IT
  initiative
• Passive resistance
• Creating culture of negativism
• Active resistance
• Change is hard to accept
• Job function may be threatened
• Exposes weaknesses in technical competency
• To reduce the risk of people-produced failure
• Include all stakeholders up-front
• Let everyone have their say and participate in
  appropriate stages of the process
• Communicate, communicate, communicate
• Set realistic expectations
• Train and retrain, provide end user support at
  highest level

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Summary

• The Good
• Our required software applications
• Our basic infrastructure
• The Bad
• Strategic use of technology to achieve mission
• Funding and planning for technology
• The Ugly

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Contact Information

• Lisa Rau
• Office 202-296-4065
• Mobile [phone]
• Email lrau_at_confluencecorp.com
• URL www.confluencecorp.com