Matching Business Processes and Nonprofit IT with Johan Hammerstrom

Do you have a technology tool that just isn’t working? How do you get at the root of the issue and find solutions?

Sometimes IT staff and directors and executives get really into the cool details of their technology tools without considering the whole organization needs and tolerances. And sometimes executives and leaders want to change IT tools on a whim, where that IT tool is deeply embedded in the functions of the nonprofit organization, and the change impacts all the stakeholders greatly, but none of them were consulted. 

How can you reconcile those two aspects and do a better job of matching business processes and nonprofit IT? What are best practices in assessing your organization needs and matching them to the available technology tools, thoughtfully making the selection (usually in a hurry and under budget and staff constraints), and then implementing your tool with lots of communication and staff training? 

 CEO Johan Hammerstrom shares some of his insights and experience gained in over 20 years of serving nonprofits with well-managed IT. 

Don’t ever look at a technology problem as just a technology problem.. 

If you zoom out enough, technology problems are always part of a larger business problem. It’s really hard to make progress on fixing technology problems if you just have that very narrow focus on the technology itself. 

The more you can zoom out and understand the broader context for the technology problem, the more you can frame it as a business problem for the organization, the more effective you are going to be at addressing it. 

At the end of the day, it may seem to you to be a really big technology problem, but it may actually be a relatively small business problem. So trying to look at what constitutes the business problem around the technology solution will help you to get better perspective on how much of a problem this really is to the organization. You may be right that it is a huge technology problem, but if you look at the larger context and it turns out it’s not a huge business problem, just let it go – because you’re not going to get anywhere trying to change that.  

Some Key Takeaways:

• Business problem aspects of nonprofit IT
  • What’s the price? What are the cost investments? What are the costs to inaction?
  • Who are the people who are impacted by this technology solution?
  • What was the decision process when the technology was chosen?
  • What is the decision process to choose a new technology now?
• Sometimes staying with sub-optimum technology solution is the decision that best matches the business needs of the organization.
• Every “untouchable” ancient IT solution that only one person knows how to keep running actually CAN be replaced. Many vendors for server-based solutions – if they are still in business – will help you move that tool to their cloud-based subscription. If the vendor is no longer in business, that function can definitely be replaced – and should be replaced – with a modern, secure, solution.
• Your people are the most important component of your technology. Plan for redundancy. 

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Thanks for listening.

Transcript

Carolyn Woodard: Welcome everyone to the Community IT Innovators Technology Topics Podcast. I’m Carolyn Woodard, your host, and I’m really excited today to be here with Johan Hammerstrom, our CEO. Johan. Could you introduce yourself? And we’re going to talk a little bit more about business processes and nonprofit IT. 

Johan Hammerstrom: Thank you, Carolyn. My name is Johan Hammerstrom. I’m the CEO at Community IT. I’ve been working with nonprofit organizations for over 25 years, helping them with their technology needs. Happy to be here today.

How to Make the Decision to Switch Platforms

Carolyn Woodard: I thought after the last webinar, you might want to go a little bit deeper into changing platforms on a whim, because one person who has a lot of authority likes this one or that one better. Can you delve a little bit more into how to make those decisions?

Johan Hammerstrom: Well, it’s interesting because we’ve switched HR systems (at Community IT) now a few times. And it takes a little while to get used to the new system, but once you do, then you’re just using the new system. And so, I could see how for certain types of systems, you can switch them up regularly in it.

I’ve always felt like it really depends on how deeply connected the system is to your business processes. The more tied in a system is to your business process, how you run your business, the more difficult it is, the more dangerous it is to change that system.  Which is why a lot of banks still are running, I don’t know if this is still true today, but I remember 5, 10 years ago, it was still true that a lot of banks, their core systems were still running in COBOL, which is a 40, 50 year old language.

Carolyn Woodard: Remember when the unemployment insurance in the very beginning of covid, when they suddenly had to help millions more people who had lost their jobs, and they were putting out notices to help us program this thing that’s only in this one old language.

Johan Hammerstrom: Exactly. I think that’s a good example, obviously a bank with its financial requirements, they have their processes, and they’re extremely strictly defined, highly regulated, and need to be precisely controlled. They probably are documented in all kinds of process documentation. It doesn’t matter how old the system is, if it’s still compliant with those business processes and doing the job. Getting a new system, you probably have to build something from scratch anyway, you know.

Carolyn Woodard: Or you’d have to change it so cautiously. You change the one piece and see what impact that has, how it ripples throughout the rest of the system, and then you change the next piece. And for each of those pieces, you probably have to give six months’ notice, so everyone has double checked that it’s not going to stop something from happening. It could get very complex. 

So, you’re saying that if the system that you’re using is intimately connected to your business or the processes, the way you do your work as a nonprofit, and deeply embedded, then that would be a system that you’d want to be more cautious about changing and maybe test run, to see what will happen if we change this? What will happen if we change this? 

Whereas there’s some other systems, for example how you collaborate or how you, I don’t know, use email, that are just kind of sitting on top. They’re just communication systems, so you can be trained to use a different way.

Does that make, is that what you said?

Personal Usability Vs Organization-wide Usability

Johan Hammerstrom: Yeah, that’s it. I mean, I think every IT system has two dimensions of usability. One dimension is the individual’s personal ability to use the system. 

And so, for example, most people either have an iPhone or they have some version of an Android phone, like a Samsung or a Pixel probably. And you’ve probably had that phone for many years, and you’ve gotten really good at using the phone and knowing where the settings are and how to get things working. That’s your personal usability.

And if you were given the other version of the phone, if you were an iPhone user and you switched to Android or vice versa, it would take you time to figure out the quirks and the uniqueness of the phone. But all that’s impacting is your personal productivity, if you will, your personal ability to use the technology. So that’s one dimension.

And I think that’s oftentimes when someone comes into an organization and they’re used to using Outlook, and the organization is in Google, they get frustrated because they have to make this personal shift. They need to build up the experience with that application to know how to use it. But that’s only affecting your individual ability to be productive and to get things done. 

The other dimension is your ability to be productive with other people, and that becomes a lot more complicated because that’s tied into business process.

Who’s responsible for what? Even in a very simple process that an organization has to follow, there needs to be clearly defined steps around who does what, and what information is getting tracked where, and then where is that information getting sent to? 

And generally, good enterprise solutions have those business process rules embedded in them in some way, and they’re configured, and it’s a mutually interdependent process where you’re changing your business processes to match what the software can do, and if it’s customizable, to some extent, you’re changing the software to match how you work. 

You may be using highly configurable systems like HubSpot. HubSpot is an inbound marketing tool, but it’s really flexible in terms of, if you can add new fields, you can create rules based on those fields. You can really customize it to work for you, in terms of how you specifically work. 

But once you get that set up, and once everybody on your team knows how to use it, it’s not just a matter of switching from HubSpot to a different inbound marketing tool or Salesforce as a sales CRM. It’s not just a simple matter of you individually learning how to use it the same way you’d need to learn how to use a new type of phone isn’t, it’s only a small part of your team knowing what fields to use. And all the customizations, all the demographic data you were storing on your deals. 

Now you have to set that all up in the new system, and maybe it doesn’t handle it in the same way. It just ends up becoming a much more complicated process that if one person is, if their productivity is impacted because they don’t know how to use Gmail as well as they know how to use Outlook, that’s not great, but that’s just impacting them. The rest of the team is still functioning. 

But if you change the entire system for a whole team that’s collaborating around the use of that system, now the team can’t function.

That’s a much bigger problem.

Assessments of Business Processes and IT Selections

Carolyn Woodard: Can you talk a little bit more about how to approach an assessment of those business processes? Because you’re not really taught. I mean, I guess often a nonprofit will do an assessment as part of a software selection. You said, maybe somebody has come in and said, I prefer this tool, we’re going to switch to this platform. Then they do this assessment to try and match up what the new platform can do to how they would do it. 

But I think theoretically we would say you should reverse that.

You should be looking at your business processes first, clearly define what you need, and then talk to the different tools or platforms to see which one best meets what you’ve got. 

And I heard sometimes even it can be the tool that you already have. Once you make that business requirements list, it may be things that the tool you’re using can already do, you just didn’t know or you haven’t had the training on that or that sort of thing.

So how can nonprofits approach, I guess, kind of self-reflection, looking at themselves, their processes, and their business needs and requirements? What works in that situation?

Johan Hammerstrom: Well, I mean, I think there’s a lot of different methodologies that you could use to try to map out your business process. And I think the approach that you take really depends on the maturity, if you will. Maybe that’s not exactly the right word, but the wherewithal, the capacity that the organization has to do that.

If you’re a small organization, you may have very simple employee handbook and no mapped or documented processes. And so, the approach that you would take would be much more ad hoc. You should just think about the main functions, work functions, that your organization does, and who’s involved in those, and how do they collaborate with each other on those, and what systems are they using to do that. 

Whereas if it’s a large organization, you may have extensive policies developed. They may already have business processes identified, mapped out, and documented to some extent. And then the evaluation process would become much more formal and would want to take into account those formal business.

Ideally, you’d have a business process diagram that maps out your different processes. And within those diagrams, you would identify where the data is being stored, who’s responsible for storing that data, when it moves from one system to another, what sorts of integrations you might have between different systems. 

But chances are, if you’re a functioning organization, all this stuff is getting built up, whether you realize it or not, because it has to in order for you to accomplish your mission. You’re making things happen collaboratively. But often, a lot of it might just happen through email. You need to get this document published. So, somebody creates it in Word, maybe they save it on their desktop, then they email it to somebody else, and then it goes around the organization and goes out to the publisher. That’s a business process. It’s happening in a sort of ad hoc way through ad hoc systems.

And that may be fine for a small organization. It may be overkill to have a more defined process that goes where you’re storing the document in a document management solution, and you’re checking it out, checking it back in, you’re doing version tracking on the document. There’s a lot of process overhead that document management systems can provide. But what value is that? 

Providing to your organization, depending on the nature of the documents, if you’re a contracting department for a large nonprofit organization, that sort of thing is essential, is critical. If you’re a legal organization, you have a much stricter set of requirements around your document management.

And so that, generally speaking, if you’re a legal organization, going back to my basic premise is you’re doing something. If you’re an active organization that’s fulfilling your mission on some level, you’ve already got processes in place, whether you realize it or not. They’re already tied to information systems, whether it’s formally recognized or not.

Start from what are we doing, how does it get done, who’s doing it, and what systems is it happening in?That’s a really simple top-level overview of how to go about that process. 

I think this question calls in the stereotype is the ED comes into the organization, is used to Outlook, they’re using Google, wants to switch it, because it’s impacting their personal productivity. But what they may not realize is maybe Google has been set up and configured in such a way that maybe they’re using Google because they’re working with external stakeholders that use Google, and they’re all using Google Docs. And Google Docs has deeply integrated features that work well with Gmail. 

Now that’s the other dimension. That’s all of the business processes that are tied into the use of this system that can’t be replicated in Microsoft 365, because it’s just a completely different approach to thinking about documents and collaboration. 

And so, if you switched out the system to benefit one individual’s personal productivity challenges, you could be risking the larger productivity of the organization. 

Carolyn Woodard: That makes sense. I know nonprofits and nonprofit leaders talk to each other a lot about what’s working and what’s not working, what tools they’re using, that sort of thing. But I would definitely say, having been in that situation myself, to talk to your peers. Don’t just talk to the vendors and the salespeople, because they will tell you that the new system will do everything that you needed to do. And then you’re going to find out when you’re implementing it, what it actually does.

Software Selection Decision Making

Johan Hammerstrom: I think selecting new systems… I mean, there’s kind of three different ways that new software solutions get selected.

The first way, which is the traditional way, which is really probably the best approach, but also is the most involved, is it’s almost like the waterfall version of software selection. You document your business requirements. You do initial research on the entire space, solution space of potential solutions. You score them relative to your business requirements. You look at price. You look at integration with existing applications, and then you narrow it down to three or four. You schedule vendor demos. You do the vendor demos with the key group of stakeholders. You score again, and then you kind of narrow it down to a final decision.

That’s the best way of doing it. That doesn’t always happen. 

What often happens is the second option, which is you’re thinking, we could really use a new project management tool. I’ve seen a lot of ads for Monday when I watch YouTube, and I’m going to try it out. So, somebody on their own, or maybe a decision maker, just with the best of intentions to trial something, starts using Monday, and then four months later, three people in the organization are using Monday. It was never really about – and I’m picking on Monday here, so apologies to Monday – It’s a good application, so I don’t mean to say that it’s not. But next thing you know, three people are using it, and now getting them to switch off of Monday onto something else is going to be challenging for them because they’re used to using this application. And then that’s shadow IT where, and you have to be really careful because if you aren’t intentional about the decision-making, you will accidentally end up with the solution that you picked randomly, you know, when you were trying to address a short-term need.

And the longer you’re in that solution and the more widespread that solution becomes throughout the organization, the harder it is to switch. Not impossible, but that’s the second option. 

And then the third is just by fiat. Someone comes in and says, we used QuickBooks Online at my old job, so we’re switching to that. And they have the authority to make that change.

Carolyn Woodard: Sometimes there are only a couple of options, right? If you have an email marketing tool, there really are only a few. So then you do have to kind of do a little bit of the reverse. “We have to have this function. Here are the three or four that are available in their different capabilities, which one fits closest what we need.” I mean, you do have to take the market into account too.

Johan Hammerstrom: Yeah. And yes, that is a great point. And I think that’s an underappreciated criteria for making software selection. Who’s the industry leader? Who is likely to still be around, especially for emerging solution spaces? Because that makes a big difference.

We’ve had customers who’ve gone with the boutique solution. We had a customer who did that for single sign-on. We said you should probably go with Okta, because that’s going to be the industry leader. They went with a different solution. And it’s just been, and they’re deeply invested in it now. It’s going to be really hard for them to switch. Really expensive, really hard. And the second-tier option that they went with, they go offline randomly, they don’t have all the integrations built in, and they don’t, you know. So, yeah, you got to be, that is a critical factor.

Carolyn Woodard: It’s hard too with the smaller, or like you said, second-tier or third-tier solutions, especially if they’re very niche too. Maybe with good intentions, someone set up that company to do this one exact thing, but if it’s not a large company, then it’s probably going to be difficult for you to find consultants who can work with it, help you with it down the line, anyone who can help configure it, or even migrate you off of it if you decide that you want to do that. You’re just going to lock yourself into a smaller set of people who can help you.

Johan Hammerstrom: Yeah. I think we always talk about Google versus Microsoft. There are other email hosts. I would be hard pressed to recommend any of them. I think you’d have to have very clear reasons for going with something that’s not Microsoft or Google, because there’s going to be limitations to how they can be integrated. There’s going to be limitations to the kind of support that you’ll get. So, you just need to be very careful. There are probably times where it makes sense to go sort of off-brand or down market with your software, but you have got to be conscious.

Carolyn Woodard: I think often nonprofits just really don’t have the leeway to make those kinds of investments, especially if it’s doubtful, or it has a higher risk of failure, they’re going to take longer to recover or be invested for longer than you should be because you’ve already sunk a lot of funds and expertise into it. 

Addressing the Technology Problems You Already Have

Can I ask you a related question maybe from the other direction? We’ve talked about if someone comes in and it’s more kind of on a whim, they say, oh, I’m more familiar with Outlook, so I want everybody to change over to Microsoft.

Can you talk a little bit about if you do come into an organization or you’re in an organization, maybe you get a promotion or you’re working with a tool in a process, and you see that there’s a problem, that your tool is not doing what you needed to do, or it’s overly complicated, or it’s a smaller vendor and you don’t have the support that you need, or there’s something that it’s just not working for you, but it’s what you use and everybody’s really invested. 

Do you have any advice in that situation? How can you maybe get an assessment going or do a project to look at your business needs and where your tools might be falling short?

Johan Hammerstrom: Yeah. 

I think don’t ever look at a technology problem as just a technology problem. Technology problems, if you zoom out enough, are always part of a larger business problem.

And I think it’s really hard to make progress on fixing technology problems if you just have that very narrow focus on the technology itself. And so, the more you can zoom out and understand the broader context for the technology problem, the more you can frame it as a business problem for the organization, the more effective you’re going to be in addressing it.

Because at the end of the day, it may seem to you to be a really big technology problem, but it may actually be a relatively small business problem.

And so, trying to look at what constitutes the business problem around the technology solution, will help to help you to get better perspective on how much of a problem this really is to the organization.

Because you may be right, it may be a huge technology problem, but if you look at the larger context, and it turns out it’s not a huge business problem, just let it go, because you’re not going to get anywhere trying to change that.

Carolyn Woodard: Yeah, that makes sense.

Identifying the Business Problem Vs the Technology Problem

Johan Hammerstrom: The business problem aspects of it are, you know, what is the price? What’s the cost investment? Who are the people that are impacted by this technology solution? What was the decision-making process for picking this technology? You know, what’s the decision-making process for either keeping it or changing it?

And I think it’s, yeah, oftentimes staying with sort of substandard technology solutions is, is going to sound crazy to say, staying with substandard technology solutions often is the best business decision.

Carolyn Woodard: Oh, yeah. I’ve heard people do in a leadership role maybe shadow the people who are doing the things, who are performing the processes.

And you could see how someone could, you know, be sitting with somebody and they’re downloading something out of one tool, manipulating it in Excel, uploading it over to some other tool that it has to get into. And you could think, that’s crazy. We have to be able to fix that.

But like you said, really for that person, it takes an hour and it’s part of the routine and it really works the best in terms of integrating those two tools. Sometimes you need to let well enough alone.

Johan Hammerstrom: Yeah, someone like that who knows what they’re doing and have been doing it for a long time, that’s a minor business problem. 

That person leaves, now you have a major business problem on your hands. 

Now replacing the technology solution suddenly becomes a possibility because what was once not a business problem at all is a huge business problem. How are we going to fulfill these work activities? Who’s going to manage this process? The person who owned it is gone. Nobody else knows this system. We’re not going to be able to bring someone in to learn it. Now we have got to deal with this.

Now you can replace the technology solution because it’s part of a major business problem.

Carolyn Woodard: Yeah, something has come to a halt.

Single Points of Failure

Johan Hammerstrom: Exactly. Hopefully, you get a heads up. I mean, honestly, this could probably be its own episode, Carolyn, of a podcast. What do you do if you have an antiquated technology solution with a single point of failure personnel. You know, what if this person gets hit by a bus? That comes up all the time. And I do think that’s the weakest link almost. That’s the need for a disaster recovery plan. What do you do if the person is gone? 

I’ve never seen like an infrastructure or software application that nobody could figure out. It’s going to be expensive, but there’s somebody out there who can come in and figure out whatever antiquated mess you might have at your organization. Ideally, get to it ahead of time, but that doesn’t always happen.

And if you don’t, there’s your opportunity to switch to a new solution.

Carolyn Woodard: Well, and it makes sense. We say often that nonprofits invest so much in their people and that the people are really such an integral part of what their business processes are. And that makes sense that nonprofits spend a lot of time keeping those people happy if they’re the one person who knows where that spreadsheet goes.

Johan Hammerstrom: We had one of our clients, they managed loans. Part of their process was managing loans. We were working with them in 2010, 2011. They had a big server room, as a lot of people did back then. And we went down to the basement, and we’re looking at all the servers and documenting it because we were onboarding them as a new client. 

And there’s one server sort of up at the top that doesn’t even have a label on it. That’s weird. We point out, what’s that server? And they’re like, we don’t ever touch that server. That’s a Unix server, not Linux, Unix, the Unix server. And that’s what runs our loan management software. Don’t touch it. We don’t ever touch it. There was only one person who knew how to use it, and he was a chain smoker. He was always out on his smoke break. And we were deathly afraid of that system. For years, we told them you have got to replace it because the server is old and there’s no way to build a new server. There’s no way to migrate it. We were worried it was going to crash. 

And then just one day they let go of the director of IT. They brought in an interim person. He says, oh, we’re switching to a new system. And within three months, they were on a new system. And then he left and another person came in and said, this is the wrong system. It’s not working for us. And they switched them to another system.

So, within a year, the system that they could never replace, they went through two systems and then they got to a system that they’re on to this day. 

You may think those ancient systems can never be replaced, but everything can be replaced.

Carolyn Woodard: Yeah. It’s a myth.

Johan Hammerstrom: It’s a myth. Yeah. Yeah.

Carolyn Woodard: Although I will say, I think sometimes, I mean, just to circle back around to it, sometimes you come into a situation and you don’t have a choice, right? The organization has already invested in WiseHive or Salesforce or whatever. It’s a big investment and it’s not working perfectly, but there are a lot of ways to get it to work better, to work for you, for what your organization needs. And that could be, you know, tutorials, really becoming the expert in that tool. It could be finding, unfortunately, the workarounds. For example, every time we do this, we just have to download that spreadsheet and then upload it in this other format to this other place. And that, you know, that’s how things keep going.

Johan Hammerstrom: Yeah. Yeah.

Carolyn Woodard: Well, thank you so, so much for your time, Johan. This has really been helpful to learn all about business processes and how to think about IT and relationship to those business needs. So really thank you.

Johan Hammerstrom: Yeah, my pleasure. Thank you. Great conversation.