Category Archives: Nonprofit Overheard Costs

Making a Case for New Technology – Measure the Results

Posted on November 15, 2011 by vertex| Leave a comment

This is PART 5 of Making a Case for Technology Purchases for Nonprofits – PART 1 is here, PART 2 is here, Part 3 is here, Part 4 is here.

When one considers everything involved in making a case for purchasing new technology, this final step of measuring your results seems to be occurring a bit too late in the process.

How will you make your case to justify new hardware or software by showing how well is works after your purchase?

Looking at the Return on Investment (ROI) of your technology decision accomplishes several tasks. First, it allows you to demonstrate to your stakeholders that you are determined to verify the effectiveness of this purchase by tracking the numbers and the feedback from users. Second, it gives you credibility for any future decisions on additional purchases – your results will show that you made the correct choice for your agency. Finally, by evaluating the usefulness of your new product, you’ll be able to make sure you’re achieving the results you want. You may find you’re not receiving as great a time savings, or salary/staff reductions, or an increase in revenue as was expected. By maintaining the proper facts and figures, you’ll be able to make better decisions to get the most from your investment.

Many who work for human services organizations shy away from for-profit business terms such as Return on Investment (or Total Cost of Ownership (TCO)) because they don’t feel it applies to them or their nonprofit mission. But the ROI is a fair way to review effectiveness and measure your results.

To see your return, you can use the simple formula for ROI as a way to see how well the new technology is working – you subtract the savings/revenue/gains from the cost of investment, divide that amount by the cost of the investment, and multiply by 100 to get your return percentage.

Keep in mind, the figures required can be complicated and require some digging to get the best results. For example, the cost of the investment is usually more than the purchase price. So include related costs, such as: service agreements, training costs, additional warranties, implementation, and extra hardware or software required in your “investment” amount. And keep in mind your revenue amount can be more than just a dollar figure. There can be intangibles that should be accounted for, such as: increased productivity, improved morale, staff reductions, and increased brand recognition/word of mouth exposure/referrals.

Just because something doesn’t have a monetary value, doesn’t mean it should be left out. And a lack of a dollar value doesn’t mean that measurements should not be taken. Make notes in your ROI calculation that shows the intangibles are not included but are counted.

Finally, the ROI amounts can be stretched this way and that to show whatever favorable results you need. The more concrete effects you can demonstrate – along with all the unfavorable details – the better off you and your organization will be. And you’ll make better decisions in the future. Track everything you can from the first day after implementation and review every month, quarter, or year to measure and report on your results.

Examine your ROI at different points in time so you can see the difference of the return for now and again in five years. Create a baseline for your current figures so you can make those future comparisons. Give yourself milestones or benchmarks so you’ll have goals to meet and, hopefully, exceed.

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Posted in Electronic Documentation for Nonprofits, enterprise resource planning, ERP Software, Non-Profit Business Advice, Non-Profit News, Non-Profit Software, Nonprofit Accounting Software, nonprofit leadership, Nonprofit Management Software, Nonprofit Overheard Costs, ROI - Return on Investment, social service nonprofit, Social Service Software, social services leaders, Social Services Technology, software for social services

Making a Case for New Technology – Determine the Risks

Posted on November 7, 2011 by vertex| 1 Comment

This is PART 4 of Making a Business Case for Technology Purchases for Non-Profits – PART 1 is here, PART 2 is here, Part 3 is here.

One of the biggest concerns many of our customers have had when they came to us for a social services software solution was overcoming their fear of making the wrong investment in new technology. It’s important that you assess the risks when you are making a case for buying new hardware or software or any technological system for your nonprofit organization.

By evaluating risk, you are showing you are aware of the concerns and are addressing what you’ll need to do to mitigate any issues before, during or after the implementation of technology.

What are some risks to consider when making a business case for new tech solutions?

Inferior Product Quality – what if the software or hardware cannot do what was promised? Or what if the vendor guaranteed to complete the process at a certain time and at a certain budget – and then fails to meet those expectations?
Low User Commitment – what if you bought the products and/or tech services and no one used it? What if your staff doesn’t want to or can’t understand your new solution and abandons it completely?
Too Technical – as your staff adoption of new technology can show, what if the system is too hard to use or difficult to learn? What if it requires a larger IT department to manage it? What if it takes months or longer to customize or update the solution? What if costs and frustration skyrocket?
It Costs Too Much – What happens if you do go over schedule or go over budget during implementation? What happens if you make a purchase and your economic situation changes and you’re stuck with a product you can’t afford? What if you spend all that money and the system cannot grow with you or adapt to your situation and you have to buy something new all over again?

There can be risks associated with anything your organization tries to do. And those risks compound when you start talking about serious money or resources. You simply can’t afford to make a mistake in the nonprofit world.

How to Overcome the Risks and Issues
There are ways to reduce the threat of problems that can come from any technology purchase.

First, it’s important to find a quality product – a server, or computer system, or productivity software – that has been proven in the industry. Throughout the history of technology, there have been fly-by-night vendors that have created products and threw them out into the market in “beta” (which basically means they’re testing it out on you… at your expense) and have disappeared into the ether.

Look for companies with a strong reputation, with a history of quality products and support, and that has been in business for while. Yes, that tablet PC is only $199 but it was made by a company in North Korea that has been in business for 10 months. An Apple iPad costs twice as much – but which manufacturers’ 2-year warranty will you trust more?

You’ll also want want to demo any product you are considering. Make sure you see the technology in action and not just view some salesperson’s PowerPoint presentation or read a brochure. Understand what their system can do, what it can do for you, and whether or not it is easy to use and/or customizable to what you need it to do.

Next, make sure your new technology choice is adaptable. Can it be customized? Can it be updated to grow (or shrink) with your organization? It can be risky to purchase something that truly won’t work in a few years because of new regulations, rules, or restrictions.

Another great way to mitigate risk is to find a manufacturer or vendor of technology that creates products or solutions specifically for your nonprofit. For example, many companies manufacture accounting software. But how many of these software vendors understand the world of human services agencies? Do they know how to allow for tracking various grants and fundraising transactions and accounts? Can their system allow for greater transparency, for internal and external audits, for accreditation, or for special payroll needs? Find a company that knows your needs and understands how to help you achieve your goals.

Finally, to cut back on your financial risk quotient, look for a tech company that can provide you with financial options. Many vendors provide a solution that is one size fits all when it comes to price. There is a single system and you pay one amount and there are no options. But good companies give you only what you need, allowing you to pick the modules, apps, or accessories that are right for your organization. They have multiple payment plans and delivery methods for their solutions (hosted software versus Software as a Service (Saas) for example.) They do not make you buy or lease items that you don’t want by doing a thorough needs analysis before even discussing price so they understand what your requirements are.

When you can lay out of these mitigation strategies that you have analyzed while you were determining risk, your case will be airtight. It means more work for you to check out all of these ideas when considering a new technology, but it could save you time, money, and big headaches down the road. Remove the chance of elevated risk with proper due diligence in the research phase and you’ll make your case to concerned stakeholders.

In the final segment of Making a Case for New Technology, we’ll look into Measuring the Results to help you make sure you can get your next tech purchase approved because you’ll have genuine facts, figures, and performance results to show.

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Posted in Electronic Documentation for Nonprofits, enterprise resource planning, ERP Software, iPad, Medicaid billing, Non-Profit Business Advice, Non-Profit Software, Nonprofit Accounting Software, nonprofit leadership, Nonprofit Management Software, Nonprofit Overheard Costs, ROI - Return on Investment, social service accounting software, social service nonprofit, Social Service Software, Social Services Technology, Units-of-Service Medicaid Billing

Making a Case for New Technology – Evaluating the Costs

Posted on October 31, 2011 by vertex| 1 Comment

This is PART 3 of Making a Business Case for Technology Purchases for Non-Profits – PART 1 is here, PART 2 is here. Part 4 is here.

When it comes to investing in new technology to help your human services organization, your team must consider all the costs associated with investment. And not just the initial outlay of funds for your new software and/or hardware.

In order to make a solid case for upgrading your processes and improving productivity with new technology, you will need to demonstrate – with realistic numbers – that you are fully aware of all the costs involved. It is an investment that will improve the way your agency works but you’ll need to prove that you understand how this will affect your budget (and not just for the current year of the purchase.)

Upfront Costs of New Technology
Naturally, you will have an immediate use of resources (cash or credit) to purchase the new software or hardware (or both.) Many solutions require that you get updated hardware or servers to accommodate any new software application or new software to make the hardware work for you. You’ll need to include funds required for every additional option or accessory you may need to customize the technology for your unique requirements.

You’ll also need to be aware if the tech purchase will be done as a Software as a Service setup or if you’ll be purchasing a license up front to host the software. SaaS requires less money initially than the hosted option but you could end up spending more money over time and will need to budget accordingly.

Upgrades and Expansions
It will be important to note in your case whether your new technology solution can grow with you or if you’ll need to purchase additional modules or hardware to add new users or expand to additional facilities. If you can add technology that is scalable to be able to grow with you at no additional costs, you will have made a much stronger case.

Other costs to consider are whether you’ll need to purchase more software or hardware when it comes time to upgrade to newer versions of the technology. Most new software or hardware systems are able to handle multiple upgrades, but you may get to a point where the technology advances too far for your new system. Make sure you discuss the upgrade process with your vendor to find out how they’ve handled it in the past.

Implementation and Training
Will there be any funding required to implement your new software or to train on your new hardware devices? This is something to consider – not every technology vendor will provide these services, outside of the product purchase, at no cost.

In making your case, you need to state how important proper implementation and training are to the success of your technology to improve your processes. A new system that doesn’t work properly (poor implementation) or that no one understands how to use (inadequate training) will not improve your situation.

Maintenance and Ongoing Support
There may be costs associated with technical support and/or ongoing support that are required to fix problems and answer questions you may have about your new technology.

Factor in those costs with your business case including any information on service or support agreements, charges to emergency help, and any information on services that will be provided for free by the vendor. Also include any warranty details or extra insurance coverage you’ll be receiving.

When you carefully consider everything required to purchase and maintain any new technology and include this analysis with your case that will be presented to the decision-makers or stakeholders involved, you’ll limit the risks and be prepared for all the resources required from you, your team and your agency.

We’ll next examine the risks of a new tech purchase to help you make a better business case for buying new software or hardware for your non-profit organization or social services agency.

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Posted in Non-Profit Business Advice, Non-Profit Software, Nonprofit Accounting Software, nonprofit leadership, Nonprofit Management Software, Nonprofit Overheard Costs, social service accounting software, social service nonprofit, Social Service Software, Social Services Technology

Making a Case for New Technology Purchases for Nonprofits

Posted on October 21, 2011 by vertex| 4 Comments

More and more, social services agencies are making the decision to upgrade their technology so they can survive budget cuts, additional audits, and an increased demand in services. They are eliminating their hodgepodge of disparate software systems, manual procedures, and redundant processes to become more accurate, more efficient, and more effective.

However, spending more money can be a lot to ask for any executive director, management team, or board of directors. After all, we’re only now seeing signs of life after the Great Recession. Money is tight and fears of an additional downturn or more cuts at the federal, state, or local level have people running scared.

You understand the need for new software and new processes because you can’t afford not to make the investment. But you’re going to need to develop a business case to prove your need for better technology.

Does this mean you’ll need to prepare a well-structured document to present your case for the use of resources? Not really. It’s certainly a great idea to create such a written business case but this really could be anything from a PowerPoint presentation to a in informal conversation that you’ll have with those in charge of the purse strings. The business case itself is a way for you to organize your thoughts, examine your needs, review features and benefits, consider risks, and to ensure there will be a return on your technology investment for your organization.

There are several steps to accomplish the goal of creating a business case. This post is going to cover the first step – defining the need for new technology for your agency.

Defining Your Need
This step sounds like it would be the easiest to tackle when it comes to making a case for a software, hardware, or a complete ERP system purchase. It may seem to be that stating something as simple as, “We need new accounting software to replace our handwritten spreadsheets!” But because there’s more to it than that, this is why it can be a very difficult step.

You can simply explain that you need a new technology or system… but it’s also important to say or show why you need it. By bringing in concrete examples, your argument will be enhanced and you’ll have more ammunition to overcome objections. When you can easily convey what your problems are, it makes it more simple to explain how your new solution will fix everything.

It is also recommended that you have more than one problem to solve.

For example, your social services agency might have a vocational rehab facility where you take on contracts from businesses or the government to produce kits or to manufacture widgets. A business case could be that you need to bring in an ERP (Enterprise Resource Planning) software solution to help track inventory, manage your supply chain, and oversee your job costing analysis. Your dilemma might be that you need this ERP system to streamline your processes which will allow you to take on more contracts and provide more jobs for your clients with disabilities.

If your existing processes cannot handle adding more work, you have a case. But your case would be infinitely stronger if you could also add that an ERP solution is needed because your currently doing too much redundant work, making too many errors, and spending too much time tracking and re-ordering inventory or waiting because raw materials aren’t being ordered on time.

Additionally, you could also build your case around the need to reduce costs. You could note that you’ve paying too many employees, spending too money much fixing errors, and are having cash flow problems because of paper invoice issues.

Finally, you’d be able to wind up and “seal the deal” by explaining that you’re stuck with an old software system that can no longer be updated (the software vendor is out of business or hasn’t done any upgrades) or has no technical support which means you cannot fix a glitch or customize it to your expanding operations.

Adding up and discussing several problems in your presentation allows you to set the groundwork for your case to make the technology purchase. And it gives you insight into what your existing needs and problems are. You’ll know where to look after implementation to see if processes and procedures are showing a return on investment.

You’ll be able to record progress and demonstrate that you were, indeed, correct about your organization’s needs.

If you need help developing a business case for a software purchase for your human services agency, talk to the consultants at Vertex Systems. We can help you deliver the right message to your board or whatever stakeholders involved to help them understand what your needs are.

Keep an eye out for more steps in the business case process! PART 2 – Assessing the Benefits is here.

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Posted in Budget Cutting Solutions, enterprise resource planning, ERP Software, Non-Profit Business Advice, Non-Profit Software, Nonprofit Accounting Software, nonprofit leadership, Nonprofit Management Software, Nonprofit Overheard Costs, ROI - Return on Investment, social businesses, social enterprise, social purpose businesses, social service accounting software, social service nonprofit, Social Service Software, social services leaders, Social Services Technology, software for social services

Is Nonprofit ERP Software the Best Solution?

Posted on July 20, 2011 by vertex| 3 Comments

Many social services agencies with sheltered and supported work opp0rtunities for people with disabilities are facing tough times. Many have packaging, kitting, and manufacturing facilities they use to employ and train their clients to help earn wages and possibly transition into their communities.

Recently, a sheltered workshop in Binghamton, NY, announced they would be closing their doors after 69 years of providing employment programs. Their problems started when they lost a contract that supplied 60% of their annual revenue.

The majority of our customers, as well as the other human services agencies in general, who provide these workshop and manufacturing facilities have no enterprise resource planning (ERP) software in place to help them run the business side of their operations. Most are using spreadsheets.

For medium and large-sized agencies, their reasoning not to purchase an ERP solution is that the software can be too expensive and the implementation too difficult to handle.

While one never knows all the details that occurred with the failed New York workshop, it should be considered that an effectively utilized ERP system might have helped the agency survive the loss of the manufacturing contract.

It can be easily argued that more funding diversity should have been a part of their plans. Losing 60% of revenue can be hard for any non-profit or for-profit business to recover from. But having the right technology in place may have helped improve leadership insights, business processes, and future planning when working with their contract company and might have led to lower cost of goods sold, faster time to delivery, and better inventory resourcing.

And after the major contract was lost, having a quality ERP platform in place would have demonstrated their ability to manufacture, invoice , track statuses, replenish inventories, and cut costs that might have landed them a new and profitable contract with a different company. Perhaps even an international concern. A proven ERP software solution could have put them in the running along with competing for-profit facilities and saved the organization and all the consumers that work for them.

Money was saved by not purchasing an enterprise resource system but what was the final outcome? Moving beyond basic accounting software and/or spreadsheets could have meant they were able to drill down into detailed statistics, create useful reports, and make informed decisions based on relevant data.

Spreadsheets cannot easily or efficiently be shared and can create silos of information and details that probably don’t make it out of each agency department. An ERP solution could provide role-based dashboards that show information across the entire agency as well as timely insights (real-time data, in most cases) into the operations of their facility. They would be able to create and share specific reports on inventory, sales, cash flow, and more. And they wouldn’t have been inundated with information but would have been able to make better-informed decisions based on the right data.

Being able to respond to problems, make good decisions, and demonstrate the abilities of their social service agency would have allowed them to be more responsive to current and potential customers. They would have improved their relationships and reputation in their industry. And the improvement in productivity of their processes would have been evident, allowing them to provide accountability to potential customers and help bring in new contracts.

If you’re not sure that an ERP software solution would help your agency not only keep current contracts but help bring in new ones, contact Vertex Systems (866-981-2600) and we’ll analyze your situation and help you make an informed decision. We have been providing quality ERP solutions – based on Microsoft’s Dynamics NAV – that are familiar to your people (integration with Excel and the look-and-feel of all the other Microsoft products), that fit your current systems, that fuel productivity, and that enable confident decision-making for 30 years.

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Posted in affirmative industry software, Budget Cutting Solutions, enterprise resource planning, ERP Software, Non-Profit Business Advice, Non-Profit Software, Nonprofit Accounting Software, Nonprofit Management Software, Nonprofit Overheard Costs, social businesses, social enterprise, social purpose businesses, social service accounting software, social service nonprofit, Social Service Software, Social Services Technology, software for social services

Meet the People we work with – Green Valley

Posted on May 10, 2011 by vertex| Leave a comment

We’ve completed a new case study of one of our clients – Green Valley Enterprises in Beaver Dam, Wisconsin.

And we’ve also got a new Customer Spotlight up, featuring the executive director of Green Valley. His name is Jack Hankes and we’d love it if you got to know the great people we work with.

The case studies are your chance to see how our clients handled the issues and challenges they are facing today. And our Spotlights put a name and face to these case studies, giving you a chance to see the people working hard behind the scenes to help those with special needs.

So, get to know the folks we work with right now!

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Posted in Budget Cutting Solutions, Case Management Solutions, Client Payroll Software, Electronic Data Capture, Electronic Documentation for Nonprofits, enterprise resource planning, ERP Software, Non-Profit Business Advice, Non-Profit News, Non-Profit Software, Nonprofit Accounting Software, Nonprofit Management Software, Nonprofit Overheard Costs, social service accounting software, social service nonprofit, Social Service Software, Social Services Technology, software for social services, Vertex Systems News

Funding Diversity for Social Services Agencies

Posted on April 28, 2011 by vertex| Leave a comment

Everyone in the social services industry has been worrying and wringing hands over the talk and actions of slashed budgets and reduced government spending. There have been demonstrations from agency workers, consumers and their families against cuts to entitlement programs in nearly every state. Tax revenues are down over the past 2 years and, at a minimum, 42 states have made cuts to programs that have already harmed our more vulnerable populations.

Many nonprofit and human services agencies are only now starting to react to these budgetary pressures. For some, it may be too late. There have been and will continue to be program cutbacks, mergers, and closures throughout the country.

Necessity has been mothering some inventive thought in the social services world for a few organizations. Many are starting to implement or expand plans and actions to increase funding diversity.

For some, it’s been a matter of starting donation activities. Others are stepping up their donation work using more calls-to-action with fundraising events, phone calls, newsletters and email blasts. Still others – those running vocational training and supported or sheltered employment programs – are looking into another diversification strategy (or increasing existing operations) to help ensure they are sustainable for the rest of the year and beyond.

There are many social agencies that have been utilizing an affirmative industry model for decades now. But this for-profit business strategy is new to many who might never considered the option. An affirmative industry business, or social enterprise as many are calling it today, could be great strategy for ensuring financial diversity. It is not some panacea for every agency across the country but for many human services work training facilities that currently provide client employment or community placement it’s not a giant leap away from their missions.

What is Social Enterprise?
Any for-profit or non-profit agency that forms a business designed to generate income for an ultimate philanthropic goal would be considered a social enterprise. And the affirmative industry model is where a vocational or day program agency would create a business that is a blend of their sheltered employment program and their community work program with a for-profit business. This would allow for the workers with disabilities to work alongside workers with no disabilities. The goal of the social enterprise is generate revenue to help the nonprofit agency that acts as the parent organization.

What has worked for many vocational rehabilitation agencies is they create this separate corporation that is responsible for the capital investment and ongoing operations of the business. It becomes a hybrid of a non-profit agency and a for-profit company to achieve social and business goals at the same time.

501(c)(3) organizations are legally allowed to do this as long as they do not raise funds through investors/investments, offer shares or profit participation, and the main activities are geared toward their social mission and not business. Otherwise, there can be tax-exempt status implications. Keep in mind, this is not legal advice, in any way, so you’ll certainly want to talk to a legal and/or tax professional to understand everything involved.

Advantages of a Social Enterprise for a Social Service Agency
The “sheltered workshop” model has been around for a very long time in this country and many have a problem this structure. Still, not every worker with disabilities is ready to move into a community job. An affirmative industry model is a step up from the sheltered employment position and can create more opportunities for a better salary and more social interaction experience.

There is a greater chance to create or develop job options that are of more interest to the clients. And the social enterprise may create more jobs in an economically depressed or rural location. It can help those who require more intensive supports still be able to find and stay with a job. And because the agency is in charge, they have ways to be more creative with job design and business outcomes to find work for nearly everyone.

Creating a new company is a daunting task, however, and one that many nonprofit social services leaders are not ready or prepared for. It involves a lot of time, energy, and funding to tackle the business and legal requirements to start a for-profit business. Many leaders of these agencies have no experience in running a business. So it is not for everyone. But it doesn’t mean that it is too hard or too expensive or will take up too much time. It is an option and it has worked in the past to create more diversified and steady funding. Our best advice would be to talk to and possibly hire for-profit business experts to help start or even run the business venture.

Just as you have sheltered employment, supported employment with job coaching, and sheltered or supported enclaves, an affirmative industry business will give your agency another option to promote the chance for sustainability.

There’s a possibility that if you’re successful, you’ll also be enriching the lives of your participants. You’ll be giving them a chance at more interesting work. You’ll be allowing them the experience of working in a business-like setting with an integrated workforce. They will have a better opportunity to earn a higher wage. While they probably won’t earn as much as a job placement in the community, they should end up with a more job stability and still have more supports.

We work with many agencies that have been utilizing social enterprises for a while now with some great success. The recession has not been easy on many due to the losses of contracts but they’ve also noted the budget cuts have had less of an impact on their organizations.

Many executive directors with social enterprise businesses have noted that it was more time-consuming than they thought but they were able to weather financial storms and will continue to be able to do so.

Is a social enterprise business an option for your organization?

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Posted in affirmative industry software, Budget Cutting Solutions, ERP Software, integrated work teams, nonprofit leadersship, Nonprofit Management Software, Nonprofit Overheard Costs, social enterprise, social purpose businesses

Tagged nonprofit budget cuts, social enterprises, social entrepeneurs, social service budget cuts, social services enterprise

Eliminate Paper at your Nonprofit?

Posted on April 18, 2011 by vertex| Leave a comment

Electronic documentation for a social services agency can really affect your efficiency and effectiveness. It means that you’ll stop spending valuable time, energy and money hand-writing case notes, filling out paper time sheets, correcting writing errors, filing documents and spending time finding the filed documents, replacing missing documents, dealing with illegibility issues, and having various staff duplicating your processes.

Imagine entering the time in and out for your clients using electronic time sheets on an iPad. Imagine submitting your service billing electronically. Imagine eliminating all the unnecessary steps in day-to-day activities, the Excel spreadsheets, and the time wasted trying to create reports.

Well, we’ve got a new way for social service non-profits to do all these things. And we’d like to show you in one of our upcoming webinars!

Our new webinar schedule has been released and you can sign up now. There’s no cost, no obligation, and as many from your agency can attend as you’d like. But sign up quickly as space is limited.

Register today for “Introducing Intuition – Be efficient & effective with electronic documentation in case management, client payroll, attendance and service billing.”

Webinar Schedule:

April 27th at 2pm EST
May 10th at 2pm EST
May 25th at 11am EST

Come see how over 450 agencies in over 35 states have tackled the “paper monster”!

Vertex Systems helps social service agencies with solutions that provide:

Faster decision-making through real-time accessibility to information
More accurate information from real-time capture
Increased staff flexibility from anywhere connectivity

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Posted in Case Management Solutions, Client Payroll Software, Electronic Data Capture, Electronic Documentation for Nonprofits, Non-Profit Business Advice, Non-Profit Software, Nonprofit Management Software, Nonprofit Overheard Costs, social service nonprofit, Social Service Software, Social Services Technology, software for social services, Vertex Systems News

Tackle the Paper Monster with Electronic Documentation

Posted on April 5, 2011 by vertex| Leave a comment

Most social service agencies that serve those with disabilities continue to rely on paper. They are hand-writing case notes, filling out paper time sheets, submitting paper billing on services delivered, and having to spend time finding or filing it all.

The argument that many organizations have is that it would be too expensive to buy software and electronic data capture devices to eliminate all the paper problems.

One thing we always ask our clients to consider is payback. A return on an investment. Yes, electronic documentation might include an initial investment upfront (software hosted on your system) or a simple monthly payment for the software (Software as a Service – SaaS).

But we always show the productivity gains and the elimination of hidden costs that come from switching to an digital time and documentation solution.

And that makes the difference when it comes to adding or upgrading their agency systems and moving away from the paper dependency.

Several research firms (IOMA, Aberdeen Group, Paystream Advisers) have done studies that show that agencies can achieve gains in productivity up to 80%.

How is this possible?

“One of the biggest hidden costs that paper-intensive businesses face is the time it takes to work with paper files. Say it takes a $20/hour employee five minutes to walk to a records room, locate a file, act on it, refile it, and return to his desk. At just four files per day, that’s over 86 hours per year spent filing – around $1700 in wages. At ten files per day, that shoots up to 216 hours per year – over five weeks’ time, or $4300 – and that’s only for one employee. A system that lets employees find and work with those documents without ever leaving their desks can instantly slash those costs. - Pam Doyle (Fujitsu’s scanner group & trainer)

Dealing with case records, client payroll time sheets, paper billing, workshop invoices, and client and staff files steals time from you day. And it means you’re paying employees to handle tasks that would be eliminated. This would allow you to either cut or re-assign staff to put them in front of people and not paper.

To give you a better idea of how much you’d save when it comes to electronic documentation and data capture software, here are a few numbers:

Average Time to Retrieve 1 Document

Paper: 4 minutes
Digital: 4 seconds

Average Time to File the Document:

Paper: 3 minutes
Digital: 0 minutes

Average Total Cost of Finding, Working with, and Re-filing Documents

Paper: $2.00
Digital: $0.20

Average Cost of a Missing File

Paper: $120.00
Digital: $0.00

Average Yearly Cost to Maintain Files

Paper: $3.44
Digital: $1.81

- Dartnell Institute and ODDSAR Publication. Dollar amounts based on a US $12.00 per hour wage, includes salary, benefits, overhead and taxes. Includes materials, facility and labor.)

A few minutes here and a few minutes there; pretty soon you’re talking about a lot of time (and time is money…)

Average invoice processing time with a paper-based process = 29.8 days. With software used to process the accounts payable = 4.8 days.
2 to 7 percent of documents are misfiled on average; a misfiled document can cost up to $120.
Executives and their staff on average spend 150 hours per year looking for misplaced documents.
An average worker consumes 10,000 sheets of paper a year.

It’s not something people regularly think about because they’re not able to step back and see all the little steps taken up in a given month or year. But it all adds up. Imagine you need to find a report or document for an audit – and it’s missing. Think about how much time, and how many people, would be involved in looking for the report. And in trying to recreate it, if that’s possible. Consider fines that might need to be paid when the document is never found.

Agencies can spend $20 in labor to file a document, $120 in labor to find a misfiled document, and $220 in labor to reproduce a lost document when all the factors are calculated.
7.5 percent of all documents get lost; 3 percent of the rest of those will get misfiled.
Staff and executives can spend 5 to 15 percent of their time reading documents but up to 50 percent just looking for it.

Electronic documentation software that allows for proper digital recording of case management notes, records and outcomes using a PC, iPad or laptop will remove paper from the equation. If you have a vocational rehabilitation facility and pay clients a commensurate wage, you will not long have to worry about paper time cards (or tracking down and fixing errors, rounding issues, missing piece rates or overlapping times.) And to be able to bill your 837i and 837p transactions electronically will reduce turnaround time to bill for services delivered.

All of this paper that social services agencies are using has severe hidden costs that are eating away at your bottom line and preventing you from reaching your organization’s goals.

If you’re interested in finding out more, contact us today. You can submit a request form or call us – 866-981-2600.

About Vertex Systems, Inc.
Vertex Systems is a leading provider of software and support solutions for social service nonprofits that serve people with disabilities. Vertex Systems software helps human service agencies be more efficient and effective, provide quality information for better decision-making, and stay compliant with regulators and accrediting bodies. For 30 years, Vertex Systems has offered field-proven solutions that provide accurate electronic documentation solutions to help streamline the processes at over 450 agencies.

They offer case management, attendance, financial management, manufacturing management, service billing, and client payroll management software systems. Vertex Systems also provides an enterprise solution that connects all the modules together to improve teamwork, increase accuracy, and reduce steps to save time and save money for agencies that serve those with disabilities.

Visit Vertex Systems software for more information about our state-of-the-art solutions for agencies that serve persons with disabilities and barriers to employment.

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Posted in Electronic Data Capture, Electronic Documentation for Nonprofits, Non-Profit Business Advice, Non-Profit Software, Nonprofit Management Software, Nonprofit Overheard Costs, social service nonprofit, Social Service Software, Social Services Technology, software for social services

Tagged 837i electronic transactions, 837p electronic transasctions, electronic service billing

A GPS for Your Nonprofit?

Posted on March 16, 2011 by vertex| Leave a comment

Social service agencies are notorious for their lack of resources and ability to spend on overhead. We consult with nonprofit organizations every day that have spent years trying to live up to their mission statements using pens, paper, and Excel spreadsheets.

When many of these nonprofit executive directors or managers finally talk to us about a software solution, they invariably ask, “Will this really make us more productive?”

I recently heard someone on our consulting team explain it to a potential customer this way – he said our software is like a GPS system.

A personal GPS can not only tell you where you are exactly located, it can tell you the distance from your location to your intended destination. And it can give you directions to get there. He added:

“Remember how it used to be when you were a kid? Your parents would buy a bunch of state maps or get those triptiks from AAA? And they would write down all the directions, plot out the best path on the maps, and hours (or days) later you’d hit the road. And you would get lost on the way and the map would never get folded back up the way it was supposed to. Sometimes the wind whipped the map out of your mom’s hands and out the window. It was never pretty, was it?”

He went on to say that it was slow, time-consuming work that added stress and costs to your vacation.

Now picture what it’s like today. You invest money in a personal GPS device, you enter your destination, and it hooks up with a satellite and tells you where you are, how far you’ll be going, how long it will take, and which roads to follow. It will even tell you how fast you’re going while you’re on your way.

In minutes.

It allows you to plot out a stress-free course and take it. Even if you don’t know where you’re going it can help you see what attractions, restaurants, and services are nearby.

A state-of-the-art software solution can do the same thing for your nonprofit agency. It can give you real-time data on where you are. It can help you make informed decisions on where to go. It helps you enter documentation once and easily sends it to all your others systems so you don’t enter it over and over. It eliminates paper. It removes errors. It gives you quality reports, when you want them, to help you see your destination. It saves you time, energy and money – which makes it pay for itself.

Where do you want your agency to go?

We offer case management, attendance, financial management, manufacturing management, service billing, and client payroll management software systems. Vertex Systems also provides an enterprise solution that connects all the modules together to improve teamwork, increase accuracy, and reduce steps to save time and save money for agencies that serve those with disabilities.

Visit Vertex Systems software for more information about our state-of-the-art solutions for agencies that serve persons with disabilities and barriers to employment.