In part 1, I explained the concept of the business model canvas and how it can be leveraged by nonprofits to diagnose and quickly map out their current business model.

Why visualize your business model? Or, why use visualization techniques at all? There's a two-pronged benefit. First, visualization tames everything in a language that everyone can understand. This opens the door to co-creativity. It simplifies complex concepts and then unifies all stakeholders into collaboration. Second, it propels any kind of hypothesis or problem into a new dimension: Rather than thinking linearly or using prescribed one-way methods, visualization considers the space around the problem. Innovative solutions, or even hidden embedded problems, can be discovered.

Implementing cloud computing into your IT infrastructure is a broad desire. Since, nonprofits are dynamic beasts with diverse functions, it's like tossing a pebble into a pond where one change would ripple  into the periphery. In this case, your entire organization.

So I'd like to test out a very common question:

What if x nonprofit considers a hybrid cloud IT infrastructure?

Here's what I know:

Cloud computing is a business decision. It usually cuts costs and saves time. "x" nonprofit thinks so, too, because they know they are growing yet they're unsure if their legacy IT infrastructure will grow along with them. Cloud computing seems like the solution, but there are other lingering concerns:

What are the real benefits? The real consequences? What or who needs priority? Who needs it most? What are our real problems? What would the true costs be in the long-term? What data should we migrate? Any staffing or training issues?

Other questions can emerge if you can come up with them. As you go through each block, keep these questions in mind.

Finally, let's give "x" organization some flesh

Let's give this organization more fictional flesh. Here's a rough anecdotal persona of a dolphin research organization that we'll use as a test subject:

Dolphin Research Organization (DRO) is a Hawaiian nonprofit dedicated to the study, rescue, and research of Spinner dolphins. DRO's daily activities are manifold: Educational outreach with schools, on-site workshops and classes, marine research, and environmental project development. Their lean in-house staff is also active with blogging, writing print newsletters, and donor management. Throughout the years, DRO improved their value propositions and thus expanded their different financial outcome streams: Aside from memberships, private foundation grants, a gift shop, and generous corporate donations, they've also built small on-site attractions and interactive programs that engage the public. These surged into a successful financial outcome stream to draw upon since DRO's facilities exist both in a natural setting and a high tourist area. Research and teaching is always an important part of their work, and they've also expanded the educational aspect of their mission by implementing internship programs and college accredited courses. However, as their member base, business processes, and public attention flourish, this also means that their IT backbone needs to be reconsidered, or redesigned to accommodate their growth.

Need the nonprofit version of the BMC?

For guidance, please use the nonprofit remix to understand each block.

Before

This is what DRO's business model looks like now:

DRO has long depended on traditional outsourced IT: website hosting, file storage and backup, email, break-fix issues, etc. Dare I say that their house file is tracked on an Excel spreadsheet?

After

And here's what the 1st iteration of DRO's business model looks like. It's where we could go with a cloud application portfolio:

 

Sticky Color Code

Yellow sticky: Unchanged
Green sticky: Possible Improvement
Blue sticky: New Addition

The ripples come from blue stickies. Green stickies are what the positive ripple effects may be.

How we came upon the 1st iteration

We're going to roleplay with the canvas to see how far the ripples in our pond could go.

Key Partners

Unchanged: Foundation "x," state tourism agency, regional attractions association, corporation "x"
Improved:
 IT services company, local print shop
New: TechSoup

Techsoup becomes an important partner in providing most donated software and discounted cloud subscriptions.

Dependence on local IT services people is decreased. They come in only when hardware "breaks." They no longer provide email and website services. Instead, DRO may begin developing a migration strategy into either Google Apps or Office 365. A professional firm that specializes in website design for nonprofits might be brought in. Why would that be important? Because many constituent relationship management systems (CRM) integrate nicely with websites and internal business processes. For example, Convio and Salesforce takes much of that into consideration.

Also, it's possible that they could start using newsletter services like MailChimp to deliver email newsletters. This depends on your audience's preferences. You can merely supplement your print communications.

Key Activities

Unchanged: Environment development projects, field research, facility maintenance, animal care & training
Improved:
 Blogging, donor management, newsletters, administrative, public teaching
New: TechSoup

Cloud applications always seem to improve productivity with your key activities.

Say that you do hire a professional firm to redo your website and make it a part of your greater marketing strategy. Your staff's workflow might improve regarding blogging and editorial tasks. And with a new website, you'll ponder e-newsletters, and make it a part of your website where your co-creators and various audiences can easily stay up-to-date and connected.

With a possible CRM looming, much of your donor management processes can be placed on auto-pilot. DRO does all their tracking on an spreadsheet. But with a CRM, it may be easier to change, update, and organize information. It also may be easier to segement your userbase according to how much they pledge, donate or communicate with you. Here's some suggested reading.

But the transition is not as easy as it sounds. What are the direct and indirect costs of migrating data, purchasing add-ons, etc? What if you have large amounts of information stored in-house?

Key Resources

Unchanged: Research equipment, research facilities
Improved:
 House File
New: Hybrid IT

Key resources can mean human, physical, financial, or intellectual. They help execute key activities. Here we see both human and physical resources improved. A hybrid IT infrastructure may alleviate some painful productivity issues that staff might've had. Possible cloud solutions that would make up part of this new infrastructure include project management, file storage, or document management. Also, with a cloud CRM, your house file can be better organized.

How does staff manage their work documents now, and does staff prefer document management through the cloud? Rather than email? What are their work habits like? For issues on BYOD (Bring your Own Device) policies and stealth IT and a possible solution, check out a previous post.

Cost Structure

Unchanged: Salaries, facility upkeep
Improved:
 Offices, IT labor & maintenance
New: Cloud licenses & subs

If DRO decides to migrate to Google Apps or Office365, then IT services like email and website hosting may be cut. Instead, that IT services company may just provide break-fix services. If Techsoup happens to be a key partner, you may qualify for discounted cloud licenses and subscriptions.

How do physical offices improve here? I'm concerned with unnecessary paper supplies. A long time ago during my IT heyday, I walked into a board member's office to work on a PC repair. Flicking on the light switch, I discovered that most of the carpet was swamped with piles of paper. I could barely see any carpet. That's how bad it was.

When I think about, I wonder how their offices could improve by using, say, Evernote and a Fuji Scansnap?

Value Propositions

Unchanged: internships, dolphin research & care, public interactions
Improved:
 workshops
New: college accredited courses

DRO's value proposition is embedded in their mission: "the study, rescue, and research of Spinner dolphins."

But what makes them different from the other research organizations? They're the only organization in their locale that offers internships, college accredited courses, workshops, and public interactions with dolphins. So they're not just any research organization. They proactively invite the public to be a part of the organization's daily activities. And they've been doing this well for many years.

Remember that DRO performs lots of educational outreach. Is it possible that their website and cloud application portfolio can assist in better organize and communicate to the public about their value propositions?

DRO also offers college accredited courses. What are their current teaching processes like? One interesting possibility here is employing an Learning Management System (LMS) like Instructure's Canvas to make teaching more accessible and enjoyable for both instructors and students.

Relations

Unchanged: direct action, attractions, programs
Improved:
 Direct public participation, outreach & marcom, community
New: None

Relations delve into the ways we develop bonds and relationships with our co-creators.

DRO has various attractions, programs, and workshops that engage co-creators. This leads the way to pleasant experiences but memorable relationships with your community.With cloud computing and a website redesign, there's a good possibility that communications and reach around these areas might be improved.

Channels

Unchanged: Phone, in-person
Improved:
 Website
New: Social media

Social media is a different issue altogether, but with the way cloud applications integrate with social networks, you could consider it a backburner idea especially if the reason is compelling enough. This might also compel you to start thinking about how social media might weave into the rest of your marketing strategy.

What channels do your co-creators want to be reached? You know them best. Remember that many CRMs and cloud solutions can integrate with your website and the rest of your business processes. Your website is more than a presence online, but also a central communication hub. And it's more compelling to find someone who knows how to design and implement a website like this.

Co-Creators

Unchanged: Direct action, attractions, programs
Improved:
 Direct public participation, outreach & marcom, community
New: None

Broad audiences are bad especially in marketing. Fortunately for DRO, they've at least drilled down into who typically visits their facilities:  college students, school students, teachers, and family vacationers.

As mentioned before, the predicted improvements in the previous blocks could allow staff to communicate and interact more better with their co-creators.

Outcome Streams

Unchanged: Gift shop, retreats, grants
Improved:
 Programs, college courses, memberships, donations
New: None

How do co-creators sign up for programs? College accredited courses? How do they manage their donations and memberships? Considering all the improvements and additions in the previous blocks, your systems for handling outcome streams and other business processes may improve too.

Sum Up

See, it wasn't just about the technology. When we started evaluating and prototyping its ripple effects throughout the entire organization, it makes us question other ways to become a more flexible, effective, and innovative organization.

It also provokes us in asking what the real costs of change may be, unearthing underlying issues which may not have been questioned yet. Not only should the business model canvas provide the space to co-creatively ponder solutions, but ponder possible mistakes in our implementation, too.

The 1st canvas = where we are now
2nd canvas onward = where we could go

There are other visual "acid tests" that you can make. You can use other service design tools like Blueprints+ or Customer/Constituent Journey Map.

But that's a topic for another day.

Further Reading: