2012 State of The Cloud Report

The State of the Nonprofit Cloud: The Results of a Study of Nonprofit Use of Cloud Software
An NTEN Report Prepared by Idealware
March 2012
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Table of contents
EXECUTIVE SUmmARy...................................................................................2 INTRODUCTION...............................................................................................3 hOW ARE NONPROfITS USINg ThE ClOUD?...........................................5 Staff Email.............................................................................................6 Broadcast Email ...................................................................................7 Office Software ....................................................................................7 Data Backup..........................................................................................7 Constituent Databases .......................................................................8 Phone/Voicemail.................................................................................8 Accounting ...........................................................................................9 Document storage...............................................................................9 Photo Sharing ......................................................................................9 Collaboration Software.....................................................................10 ADOPTION Of ClOUD SOlUTIONS............................................................11 Why ARE NONPROfITS ChOOSINg ClOUD SOlUTIONS?...................13 Remote Access ...................................................................................13 Reduced maintenance......................................................................14 modern features and Interface ......................................................15 The Cost of Cloud Software .............................................................15 But Its Just Software.........................................................................16 Whos Doing the Choosing? .............................................................17 SECURITy IN ThE ClOUD ............................................................................18 CONSIDERINg RETURN ON INVESTmENT ...............................................21 CONClUSION: WhAT DOES ThIS mEAN fOR yOUR ORg? ..................22 ABOUT ThE AUThORS................................................................................24 ABOUT IDEAlWARE.....................................................................................24 ABOUT NTEN .................................................................................................25 APPENDIX A: RESEARCh mEThODOlOgy..............................................26 APPENDIX B: DEmOgRAPhICS ..................................................................27 APPENDIX C: SURVEy TEXT ........................................................................28
NTEN: A COmmUNITy TRANSfORmINg TEChNOlOgy INTO SOCIAl ChANgE ThE STATE Of ThE NONPROfIT ClOUD mARCh 2012
Executive Summary
When we set out to look at the State of the Nonprofit Cloud, we werent sure what to expectand what we found was that its somewhat foggy.
The vast majority of nonprofits we surveyed were using hosted software, but our interviews with staff members revealed that many didnt even realize those systems could be considered hosted, or cloud, solutions. In addition, many respondents said they were concerned about security for some hosted systemsespecially constituent databasesbut were comfortably using other hosted systems for equally sensitive information, such as business email. In the fall of 2011, we surveyed 780 nonprofits. An impressive 91 percent reported that they were using some kind of cloud-based software solution. The most commonly used cloud-based systems were staff email solutions, at 69 percent, followed by broadcast email (57 percent) and office software (44 percent). Once a nonprofit starts using one cloud software solution, its likely to use moreorganizations tended to be satisfied with cloud solutions, and have a more favorable attitude toward others. In fact, nearly 80 percent were using more than one cloud solution, more than 37 percent were using two-to-four, and 42 percent were using five or more. Why are they using cloud solutions? more than 42 percent cited remote access as an advantage, and nearly 24 percent cited ease of maintenance. But many organizations simply choose software that will work for them based on the feature-set, ease of use and cost over time; the fact that it was cloud-based either didnt factor into their decision, or it was secondary. This is echoed by the finding that many organizations did not rely on technology professionals to help make their choicesmany of the software decisions made by the organizations involved in our research were made by program staff or executive directors. many of the people who participated in our research said they were concerned about the security of cloud solutions. A whopping 59 percent of survey participants who volunteered information about disadvantages of the cloud cited some variation of data control, security, privacy or access, and about 61 percent felt that unauthorized access and reliability of access were major concerns when choosing software. Security is a nuanced issue with a number of facets, but many nonprofit staff members in our research didnt have a very nuanced understanding of it. The experts we interviewed agreed that nonprofits fears about unauthorized access were generally unwarranted, and cloud solutions are typically no less secure than any other computer connected to the internet. While very few organizations said they were measuring the Return on Investment of cloudbased solutions, the vast majority of respondents said they believe they have been helpful. Survey respondents and interviewees mentioned that the cloud benefitted organizations by reducing the burden on the IT infrastructure and staff. Such solutions provide nonprofits with the opportunity to outsource something, such as the maintenance of servers and software, that may not be a core competency of the organization.
Introduction
As a solution to everyday technology issues, microsoft ads propose you go To the Cloud! IBm ads suggest that your Cloud is powerful, flexible and easy to use. Nonprofit technology experts suggest that software in the Cloud can help organizations spend less time managing their infrastructure. Everyone seems to be talking about the Cloud. But what, exactly, is it? Consumers are finding that the answer to that question is often less than clear. In fact, different peopleeven different technology professionalshave different definitions. The terminology is new the clever name makes for easy shorthand, and its attractive to marketersbut the idea of cloud-based computing has been around for quite a while. The term cloud came into common use around 2007, but the similar concepts of hosted software or Application Service Provider (ASP) software have been around much longer. Experts can make technical distinctions about the terminology, but for our purposes theyre synonymous: In general, any software accessed over the Internet can be considered cloud software, including everything from facebook to broadcast email tools like Constant Contact to online accounting systems and constituent databases.
Origin of the cloud

The term the cloud has techie roots. a cloud (like a rain cloud) is the icon traditionally used in network diagrams to denote the Internetand before that, the telephone network. Essentially, it symbolized a nebulous cloud of stuff that existed somewhere else that IT staff didnt have to worry about.
In general, any software accessed over the Internet can be considered cloud software.
With so much talk about the cloud, we wanted to find out whether, and how, nonprofits are making use of it. In September and October of 2011, we surveyed 780 nonprofit professionalsall of whom were members of one of seven state nonprofit membership associations to see what Internet-based software they used, and what they perceived to be the pros and cons of these types of systems. Though these respondents tended to work at small- to medium-sized nonprofits, they came from all around the country and represented a wide variety of missions. In November and December 2011, we followed up with seven nonprofit staff members who had chosen to use cloud software, and four consultants who do general technology consulting to smaller nonprofit organizations, to ask them about the same topics. (for a detailed breakdown of our research methodology and survey respondent demographics, see Appendices A and B.)
What we found were some interesting contradictions. The vast majority of nonprofits surveyedover 91 percentwere using hosted software, but our interviews revealed that many didnt even realize those systems could be considered hosted, or cloud, solutions. In addition, many respondents who said they were concerned about security for some hosted systemsespecially constituent databaseswere comfortably using other hosted systems for equally sensitive information, such as business The vast majority of email.
Case Study: The Invisible cloud

In our interview, John, the de facto tech guy of a $1.2 million leadership and community-building organization, initially said his organization used no cloud-based software. a bit later, he happened to mention that hes using constant contact, a webbased broadcast email system that John didnt recognize as a cloud solution. This theme recurred repeatedly among our interviewees. One theory is that, because broadcast email software arguably began as a cloud solution and remains a cloud solutionunlike other software, like Microsoft Word and Excel, which until recently was always installed on local machinesmany users simply dont register it as part of the cloud.
nonprofits surveyed over 91 percentwere using hosted software, but our interviews revealed that many didnt even realize those systems could be considered hosted, or cloud, solutions.
In short, we set out to look at the State of the Cloud, and found that its somewhat foggy. Clearly, nonprofits are using cloud-based software, and in increasing numbers, but many dont know exactly what hosted software is let alone have the ability to accurately gauge the pros and the cons of using it. This report lays out the results of both our survey and interviews.
We hope our research and this report will help clarify what the cloud is, and the different ways nonprofits are making use of what it offers. Note: Throughout this report are quotes from participants in our research, which may have come from either open-ended responses from our survey or statements made in our follow-up interviews. All such quotes are anonymized, as are the mini case studies: any names of individuals or organizations have been changed. Special thanks to Google for supporting this research.
how are Nonprofits Using The cloud?

Section Summary among all respondents, staff email solutions were the most widely used type of cloud-based systems, at 69 percent. Other solutions included: Broadcast email, at 57 percent. Office software, at 44 percent. Data backup, at about 41 percent. Constituent databases, at about 40 percent. Phone or voicemail services, at 36 percent. Document storage, at 32 percent. Photo-sharing sites, at just under 30 percent. Collaboration software, at 23 percent. In general, office software was the first cloud-based software to be adopted by users, with more than 71 percent reporting that theyve been using it for three or more years. Other adoptions of three or more years included: Staff email, at 70 percent. Phone or voicemail services, at more than 66 percent. Data backup, at 50 percent. Document storage, at 48 percent. Broadcast-email, at 45 percent. The idea of the Cloud is a nebulous one, but it translates into everyday software already in use by many organizations. We asked our survey respondents if they were using versions of 10 different kinds of software that they accessed over the Internet. Through their responses, additional comments, and details from our interviews, we formed a fairly clear picture of the most commonly used types of cloud software. Percentage Of respondents Using The cloud By Solution 70% 60% 50% 40% 30%
29.83% 41.36% 69.27% 56.98% 44.05% 40.20% 32.27% 32.91% 36.88%
respondents using this solution in the cloud
20% 10% 0%
Staff email Data backup
23.05%
Broadcast constituent Office collaboration Photo email to database software software sharing constituents
Document accounting Phone storage system system or voicemail
Table 1 Percentage of all respondents using a cloud solution for each of these software needs.
Staff Email Tools like google Apps and the hosted version of microsoft Exchange greatly simplify the administration behind providing staff with email and calendaring functionality. Nonprofits are adopting these types of tools with gusto: 69 percent of our survey respondents reported using staff email functionality accessible via the Internet. (Note that for some of the smaller organizations, this could also mean staff accounts through more individualized services such as gmail, yahoo or AOl). The burden of running an in-house email server can overwhelm a small nonprofit. Email server software and hardware can be both expensive and complicated. Keeping a system backed up and maintained requires the services of IT staff with skills in email administration, and the cost of time and materials to upgrade the software or replace hardware can be prohibitive. Contrast this with the cost Nonprofits are more likely and convenience of cloud-based email to start using the cloud and its easy to see why so many people favor the latter. through email, making
Case Study: Moving to cloudBased Staff Email

Nairit, an IT manager at a large local community services agency, has been running an in-house Exchange server thats been constantly plagued by viruses and other problems. When it came time to upgrade, Nairit investigated cloud solutions and found they would be cheaper than continuing with an in-house email server, so he presented a cost/benefits analysis to the organizations executive committee. The committees initial concerns were not that the solution was in the cloud, but whether or not it would meet staff needs for email and calendaring features. after comparing hosted Exchange to Google apps, Nairit decided Exchange would work better for his particular needs. The organization made the switch in 2008. Im trying to move as much as I can to the cloud wherever it makes sense, he told us after three years with the system. This year his organization plans to move to Office 365, Microsofts hosted version of Office, and Orange LEaP, a cloud-based donor management solution.
services like Gmail and Google Apps a sort of gateway cloud.
Whats more, nonprofits have been using these email applications for quite some time. Of the 541 organizations using a hosted staff email solution, 70 percent adopted it three or more years ago, and 21 percent have used it for at least one year, and as long as three. Three interviewees specifically mentioned a staff email clientsuch as gmail or a hosted version of microsoft Exchangeas their first cloud solution. A fourth mentioned a broadcast email tool.
Based on this data, it seems that nonprofits are more likely to start using the cloud through email, making services like gmail and google Apps a sort of gateway cloud. how Long have Organizations Been Using The cloud?
1 to 3 years
More than 3 years
100% 80% 60% 40% 20% 0%

Staff email Broadcast email to constituents Office software (e.g. word processing, spreadsheets, etc.)
21.07% 70.06%
38.65%
17.73% 71.51%
45.17%
Table 2 how long organizations have been using the cloud.
Broadcast Email Broadcast email software, or tools designed to send hundreds or thousands of emails, ranked immediately behind staff email in usage among respondents, with 57 percent saying they use such broadcast tools as Constant Contact, Vertical Response or mail Chimp. Broadcast email is unique, as it was born in the age of cloud computingbecause there are no installed systems as well-regarded as the cloud solutions in this category, these tools may not even register to many users as being in the cloud. for instance, two people we interviewed used Constant Contact but didnt initially mention it as one of their cloud solutions; one said he used no cloud software at all, but mentioned Constant Contact as his broadcast email solution. While users were still most likely to adopt this technology more than three years ago, this was not as strong a trend as staff email (only 45 percent), and 16 percent of users adopted broadcast email only in the past year. Office Software Productivity software, or office software, is typically a suite of solutions that includes word processing, spreadsheet and presentation tools. microsofts Office suite of installed software has dominated this category for more than a decade. however, a respectable 44 percent of survey respondents said they were using hosted office software.
In general, these solutions havent yet gained as much traction as cloudbased solutions in the email categoriesnor are they as mature. While such cloud-based office solutions as google Apps and microsofts Office 365 have been available for several years, traditional installed versions are often more feature-rich and better integrated with the network drives and folders familiar to staff. (One survey respondent mentioned that she had looked into google Apps for her organizations documents, but found it clunky.) however, organizations using hosted office software were the earliest adopters of cloud-based solutions in any of the categories we asked aboutmore than 71 percent have been using it for more than three years. Its likely that many respondents adopted google Apps at the same time they began using gmail.
We moved from a datastorage system onsite to an online data-storage system. The onsite system was obviously not reliable should the building be lost in a fire, etc., so the greatest advantage is that our data is stored off site.
Data Backup Cloud-based data backup solutions can be a convenient option, especially for smaller organizations. These packages will automatically synch with your local files and network to create online copies. About 41 percent of our survey respondents reported using an online data backup solutionhowever, we dont know if the other 59 percent were using an alternate backup method or simply not backing up at all. Interestingly, while half of the organizations using online data backup started doing so more than three years ago, adoption seems to have dropped off since then. One possible theory is an increased interest in data backup and business continuity in the wake of disasters like hurricane Katrina, which has since faded.
constituent Databases Constituent databases provide features to track the people a nonprofit works with, such as donors, clients and volunteers. About 40 percent of our survey respondents chose to use a cloud option in this area. When asked about the cloud, interviewees often thought first of constituent databasesand, in fact, the benefits and issues associated with cloud-based constituent databases parallel those often cited for the cloud as a whole (as discussed later in this report). An installed constituent management system often requires a shared database and serverand skilled IT staff to make sure its properly installed, maintained and backed-upbut a cloud solution requires only a relatively modern, free web browser. On the other hand, constituent data often requires strong security, privacy and reliable access, which were frequently cited by respondents and interviewees as disadvantages of cloud solutions. Other research has noted a trend toward the cloud for systems in this area. The vast majority of new constituent database solutions are cloud-based, and most vendors who offer installed solutions also either offer a hosted option or plan to in the near future. how Long have Organizations Been Using The cloud?
1 to 3 years
More than 3 years
100% 80% 60% 40% 20% 0%

Data backup constituent database Phone system or voicemail accounting system
34.98%
26.43%
19.10% 71.18%
22.96% 65.37%
50.77%
57.01%
Our new online membershipmanagement system helps us keep better track of our members. Theres been significant savings in staff time [and] its easier for members to update their own information, register for events and pay fees.
Table 3 Length of time in years organizations have been using cloud-based solutions.
Phone/Voicemail The idea of cloud-based phone and voicemail is an interesting one. In a sense, simple phone service has always been in the cloudaside from the handset, telephone services have always required metered use of infrastructure owned by telecommunication companies. however, the increasing use of Internet-based telephone services and hosted voicemail and linemanagement vendors has brought new elements to the table for consumers. With a high-speed Internet connection, Internet-based telephones and PBX systems to coordinate multiple lines and voicemail, vendors can provide solid phone infrastructure without the hassle and complexity of extensive onsite hardware for a simple monthly fee. Only about 36 percent of survey respondents indicated that they used hosted phone or voicemail services, but, on average, theyve been using them for longer than all but one other technology areaover two-thirds have been using them for more than three years.
accounting Accounting software can be simple, like Quickbooks, or full-featured and complex, like great Plains Dynamics or Sage mIPS. There are hosted options at all levels, and useful reasons for an organization to choose one over a more traditional installed solution. Cloud-based accounting systems can be accessed remotely, or from different offices, and software updatespotentially including changes in federal and state tax codesare handled by the vendor, eliminating oversights. Just under a third of survey respondents reported using accounting solutions hosted in the cloud. They were much more likely to have adopted one several years ago than in the past year. Document storage from such convenient players as google Apps and Dropbox to enterprise-friendly options like Box and Egnyte.com, there has been a surge of document-storage solutions on the Internet. These tools are useful for sharing particular documents with people or machines in other locations, or as more enterprise-wide alternatives for storing files on in-house network drives. Of our respondents, 32 percent use cloud-based document storage. While 48 percent have been using it for three or more years, nearly 20 percent adopted it in the past year, making it one of the younger technologies. Photo Sharing Photo-sharing sites like Picasa and flickr have been around for several years. Just under 30 percent of respondents use these services, and organizations were just as likely to begin in the past year as they were three years ago. As with online document storage, it is unclear from our survey data whether or not cloud photo sharing is being used enterprise-wide or on more of a per-employee basis for convenience, though we suspect the latter. Because we see an adoption spike of users who started using it about two years agoat a time when flickr, Picasa and even facebook were rapidly growing in popularityits possible that organizations picked up this technology then but have since stopped using it enterprise-wide.
Case Study: Moving Finance to the cloud

When looking to upgrade back office software, one small human services organization turned to the cloud for new accounting, fundraising and payroll systems. Despite having to pay for each user, the software has made lives easier overall at the nonprofit. Payroll especially has worked well, an employee told us, since we have a number of sites and more are going to virtual office so employees can complete their time sheet with any Internet access. Because the organization has the equivalent of just one quarter-time IT staff person, the cloud has been a benefit in relieving the demand on servers and maintenance time. In addition, leadership now feels that, given the lack of IT employees, the cloud systems are more secure than the nonprofits own inhouse software.
how Long have Organizations Been Using The cloud?

1 to 3 years More than 3 years
100% 80% 60% 40% 20% 0%

Document storage Photo sharing (e.g. Flickr) collaboration software
32.54% 46.35% 48.41% 40% 26.18% 35%
Table 4 Length of time in years organizations have been using cloud-based solutions.
collaboration Software At just 23 percent, cloud-based collaboration software usage ranked the lowest among our respondents. This can be a confusing categorywhile hosted versions of SharePoint and Basecamp might spring to mind as collaboration products, other products such as google Docs and Office365 could also fit the bill, as they allow multiple users to collaboratively edit the same document. Thus, the relatively low rate of usage reported could be due to uncertainty about this field of products. On the other hand, it may simply be that demand for online collaboration is low. None of the users or consultants we interviewed mentioned use of collaboration software. Of respondents, 40 percent were most likely to have adopted collaboration software three or more years agoonly slightly more than the number who adopted it more recently. however, at 25 percent, collaboration software was also the second-most likely technology in this survey to have been adopted in the past year, behind photo sharing. The steady, but small, differences in adoption periods and low overall usage suggest that, while few organizations are using collaboration software, the number of users continues to growunlike the other technologies we asked about that had strong initial adoption, but drastically lower recent-adoption rates.
Case Study: Board collaboration in the cloud

With a board spread all over the state, this small Pennsylvania health organization needed a better way to collaborate and share documents. The cloud seemed like the only option, and now the staff uses an online board portal to share governance documents, saving time and money over the previous approach of mailing documents. While the upload time for the documents can be slow, the portal has also proven useful as off-site storage for backing-up organizational data.
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adoption of cloud Solutions

Section Summary among our respondents, an impressive 91 percent reported that they were using some kind of software solution in the cloud. Of those: Nearly 80 percent were using more than one cloud solution. Over 37 percent were using two to four cloud solutions. 42 percent were using five or more cloud solutions. All in all, nonprofit organizations are adopting cloud solutions in enormous numbers. A whopping 91 percent of all organizations that responded to the survey were using some kind of software solution in the cloud that means less than 9 percent were not in the cloud at all. Because we specifically sought nonprofits who were not especially technology savvy, we feel theres little doubt that a vast majority of medium-sized and larger nonprofits such as those represented in our survey are using the cloud in some form. What kinds of organizations were most likely to be using hosted software? most notably, organizations with more IT staffthey also tended to adopt the cloud earlier. Whats the connection with IT? Being more technically-savvy, it is reasonable that IT staff are more likely to try newer or cutting-edge technologies. cloud adoption and IT Staffing 50% 40% 30% 20% 10% 0%
No one is responsible for IT about 1/4 time person Less than a full time person 1 full time person 2 or more ITStaff 3 or more solutions at least 3 years old
Once they get in it and see the advantages, it can be a lot easier to sell it to staff.
Table 5 Percent of respondents who have used three or more cloud solutions for at least three years each by number of IT staff.
Surprisingly, however, there seems to be no connection between cloud usage and an organizations budget, perhaps implying that the cloud has helped break down cost barriers for many of these technologies. We also couldnt find any correlation between an organizations use of the cloud and the number of work locations it maintains, including multiple offices, telecommuters or remote employees. While nonprofits felt that the ability to access software from anywhere was an important benefit of hosted software (as discussed in more detail in the next section), this did not seem to translate into organizational trends for more distributed organizations.
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The age of organizations seemed to factor into whether or not they were using the cloud. Organizations fiveto-20 years old were more likely to use the cloud than both older and younger organizations. Perhaps these younger organizations, formed during or after the rise of the Internet age, have a culture that more eagerly embraces Internet technology than older organizations, while the very young arent yet using a lot of technology at all.
Most people are pretty open to cloud computingyou can work from home, you can log on from anywhere. We would be open to trying other cloud-based solutions.
We did find that once a nonprofit starts using one cloud software solution, its likely to use more; organizations tended to be satisfied with cloud solutions and have a more favorable attitude to others. four of the six organizations we interviewed had no concerns with their cloud solutions, while the other two had small problems that were quickly resolved. Three were already using multiple cloud solutions, and three others said they were open to, or actively seeking out, more cloud solutions.
for most organizations, this sentiment seems to come as a result of overall staff satisfaction, but one interviewee remarked that staff mostly just followed her lead on the software as she moved as much to the cloud as she could. The consultants we spoke with agreed that many organizations they worked with started trying to move more solutions to the cloud after getting started with their first.
Survey data supported this snowball effect, as well. Nearly 80 percent of nonprofits surveyed were using more than one cloud solution, with over 37 percent using two to four, and an impressive 42 percent using five or more. IT Staffing and Number Of cloud Solutions 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
No one is responsible for IT about 1/4 time person Less than a full time person 1 full time person 2 or more IT Staff Less than two Two to four More than four
Number of cloud solutions
Percent of respondents
23.46%
16.76%
15.05% 39.78%
20.48%
22.22%
0
40.22% 37.24%
8.71% 11.91% 12.42% 13.19% 11.78% 9.86% 9.22% 7.94% 5.76% 5.89% 2.82% 0.51% 100%
1
32.53% 34.57%
2 3 4 5
43.02% 39.30%
45.16%
46.99%
43.21%
6 7 8 9 10 11
Grand Total
Table 7 Percent of respondents, by IT staff size, using multiple cloud solutions.
Table 6 Number of cloud solutions used by organizations.
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Why are Nonprofits choosing cloud Solutions?

Section Summary Survey respondents and interviewees both mentioned that the cloud benefitted organizations by reducing the burden on the IT infrastructure and staff. Respondents also reported taking a number of advantages and disadvantages into account when considering cloud-based systems for their organizations. Among them: more than 42 percent cited remote access as an advantage. Nearly 24 percent cited ease of maintenance. more than 50 percent cited cost as a factor in their selection process. 39 percent that decided against a cloud solution cited total cost over time. more than 50 percent of those who decided against a cloud option cited conversion costs. Why are nonprofits taking up cloud solutions in such high numbers? It appears to be due to a combination of factors. hosted options offer some particular advantagesfor instance, the ability to access them from anywhere, and the opportunity to reduce IT infrastructure and staff. But for many organizations, the decision to use a cloud-based software package is a matter of weighing features, cost and time, just like any other kind of software.
We have multiple sites, so a hosted solution would offer a single point of access for our staff.
remote access Because you can access cloud software through a browser, it has the distinct advantage of portabilityyou can use it anywhere you have an Internet connection. As we mentioned, there was no correlation between how many locations an organizations staff members worked from and its use of the cloud, but remote access was still a major concern for survey respondents. Those who had recently implemented a cloud solution were more concerned about remote access than other respondents, but not as concerned about time and cost. Not surprisingly, organizations that had recently decided against a cloud solution cared the least about remote access. remote access as a Factor For Software Selection
We considered it, but it wasn't a top priority
80% 60% 40% 20% 0%

Organizations that recently seleced a cloud solution
This was/would be a deciding factor
21.27% 48.87% 22.95%
28.46%
36.07% 19.67%
Organizations that decided against a cloud solution Organizations that did not recently selecet a cloud solution
Table 8 Percentage of respondents who felt remote access was important for selecting software, based on whether or not they selected a cloud solution.
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When asked to list some of the advantages of cloud software, over 42 percent of respondents cited the ability to access the software remotelyalmost double the number for the second most-mentioned advantage, ease of maintenance. In addition, several interviewees cited remote access as an advantage that had a positive impact on their organizations mission, and three of the four experts we interviewed listed it as a benefit of cloud computing. Not only does the cloud make telecommuting or working from home easier, but it enables social workers and case workers to access a database or other software while in the field, saving time that would otherwise be spent on data entry back at the office. have you found any specic advantages for your organization in using hosted solutions over installed? If so, what? Remote access maintenance Cost Data Back-up Sta time
Table 9 reported advantages of cloud solutions.
Percent of respondents 42.75% 23.91% 8.33% 6.16% 1.81%
Survey respondents and interviewees both mentioned that the cloud benefitted organizations by reducing the burden on the IT infrastructure and staff.
reduced Maintenance Another frequently mentioned benefit of the cloud for nonprofits is that it shifts the burden of maintenance to the vendor. Traditional installed software can require a great deal of maintenance, as can the hardware on which it runs. Updates, security patches and even data storage can be expensive and time-consuming especially for small organizations with no IT staff. Nearly 24 percent of respondents listed ease of maintenance as an advantage of cloud software. Almost 45 percent felt that it would be a deciding factor. Not surprisingly, those who had recently decided against a cloud solution were least concerned about maintenance. Survey respondents and interviewees both mentioned that the cloud benefitted organizations by reducing the burden on the IT infrastructure and staff. Time It Takes To Maintain the Software as a Factor For Software Selection
80% 60% 40% 20% 0%

23.98% 42.08% 18.03% 27.87%

Organizations that decided against a cloud solution
20.24% 48.10%
Organizations that did not recently selecet a cloud solution
Table 10 - Time spent maintaining software as a factor for selection.
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All of the experts we interviewed saw reduced infrastructure maintenance as a key benefit of the cloud. As one expert put it, the cloud enables organizations to spend less time wrestling with software, more delivering mission. Traditional installed software requires a skilled professional to manage the required hardware and software, and ensure updates are correctly and promptly installed and that data is reliably backed up. In contrast, cloud solutions typically require only a reasonably up-to-date web browser with a stable, high-speed Internet connectionthe vendor takes care of the hardware and maintenance.
Modern Features and Interface While early web-based solutions tended to lack the polish of traditional installed options, the experts suggest that the situation seems to be reversing. Newer cloud-based systems leverage improvements in the ability of web browsers to display information, often surpassing their installed counterparts in look-and-feel and flexibility. The ease of generating web There tends to be more forms means browser-based software can provide different users with innovation on cloud customized interfaces. While this can be done with traditional software, solutions as its easier to it takes more effort from programmers, and happens less frequently.
The cost of installation and maintaining apps on each computer is a hassle, and difficult to keep up to date. Having cloud apps significantly reduces internal technical time. [It] also reduces the need for internal hardware.
roll out updates. Theres a higher rate of innovation to the things that matter to nonprofits, like mobile and social media.
The cloud offers advantages for vendors, too. A rental-based delivery model can ensure a constant revenue stream thats not slowed by the reluctance of customers to pay for software upgrades. This means that new software vendors in some categories of software are releasing only cloud options, decreasing the pool of installed software thats available.
The cost of cloud Software In the cloud, as with any software, nonprofits look at the overall cost of the software when making a selection. Across all the survey respondents, cost was a top priority for selecting software in the cloud. Of organizations who decided against a cloud solution, 39 percent cited total cost over time as an important decision making factor, and over half of other organizations also looked at cost as a priority consideration. The Total cost Over Time as a Factor For Software Selection
80% 60% 40% 20% 0%

19% 56.56% 14.75% 39.34%
19.44% 52.71%
It seems like the installed software is a pay it once-and-done, [but] often the cloudbased software is a subscription type of service. It just does not seem cost effective for our size of operations.
Table 11 Percentage of respondents who felt the total cost over time was important for selecting software, based on whether or not they chose a cloud solution.
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There is typically a breaking point for the cloud fee per user model. One of the consultants we interviewed noted that in the cloud, the biggest [cost] isnt equipment, but the number of usersat a certain number of users, it typically becomes more cost effective to buy a solution than to rent it. One consultant put this point somewhere between 50 to 100 users, but the true number will vary from one vendors pricing model to the next. Some vendors offer volume discounts, and others might even negotiate flat fees. Such models make cloud solutions more cost effective for larger numbers of customers, but total cost over time will remain a concern for many larger organizations. more than half of organizations who had not recently had to make a decision to use or not use a cloud solution cited conversion costs as an important consideration. This is a legitimate concern. As one experts said, you can flip [a cloud solution] on with a credit card, but that doesnt mean you shouldnt think in advance to set it up right. Whether a solution is installed in-house or rented in the cloud, setting up the system and moving data between systems is neither easy nor inexpensive. The cost Of conversion as a Factor For Software Selection
We considered it, but it wasn't a top priority This was/would be a deciding factor
Case Study: To the cloud, For cost Savings

When it outgrew its previous email server, this multi-location human service organization decided to replace Outlook email with Google apps. Even after paying for help with the transition, it still saved money over the annual fee charged by the old provider. Some organization staff had trouble switching from Outlook, but overall, the organization has been satisfied with the transition, and has taken advantage of such new features as a common calendar system, online document sharing and storage, and the improved collaboration between offices.
80% 60% 40% 20% 0%

18.04% 13.57% 36.65% 18.03% 36.07% 50.90%
Table 12 The percent of respondents who felt that the cost of conversion was important for selecting software, based on whether or not they selected a cloud solution.
But Its Just Software Our interviews made it clear that many nonprofit staff who choose cloud solutions dont seem to know or care that the solution is in the cloud. for example, two of the six users we interviewed were using applications like broadcast email and online survey tools without realizing that they were cloud-based. Another interviewee chose a cloud-based solution after the install CD for the installed version failed to work. In all these cases, the decision was based on what worked, and what was available, rather than whether or not the solution was cloudbased.
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Our experts agreed with this platform-agnostic approach to solution decision-making. One said, Its not The cloud is right and installed is wrongyou need to make an informed decision based on your needs and costs. many of the concerns mentioned in the survey were basic software considerations that would be true for any software, hosted or installed. for more than half of all respondents, the total cost over time was a deciding factor in their software selection, and over 45 percent also cited the cost of converting from their previous software. Similarly, 38 percent were concerned with how the software would impact staff time. In total, two-thirds of organizations were concerned with whether the cloud software would work with their existing applications. concerns For choosing Software
80% 70%
52.75%
60% 50% 40% 30%
33.16%
44.81%
38.16%
45.71%
38.41%
44.17%
30.22%
20% 10% 0%
The time it takes to train our staff to use this
27.78% 21.13% 16.77% 18.95%
25.99%
22.02%
The time it takes to maintain the software
The time it takes for our staff to use the software
The cost of converting from our previous software
The total cost over time
The ability to work remotely
The ability to work with my other existing applications
Table 13 Percentage of respondents concerned about specific factors for software selection.
Whos Doing the choosing? IT departments have traditionally played a large role in software selection. however, our interviews revealed that this is not necessarily the case when it comes to deciding to move to cloud software. Three of our four experts noted the absence of IT staff among cloud decision makers. Perhaps because cloud-based solutions generally require just a web browser, system compatibility and infrastructure are far less important considerations, rendering IT staff input comparatively unnecessary. With cloud solutions, fundraisers and program staff are empowered to choose the software that works for them. Of the users we interviewed, all said they drove the effort to choose their organizations cloud solutions, and only one of the six was in the IT department. Its hostedwe dont even need to tell IT, one of our experts said, quoting a client. however, another said cloud solutions shouldnt necessarily cut IT out of the software looprather, it should enable IT staff to take a broader, more strategic role. more software choices can be driven by IT, he said, because the cloud can often serve a broader swath of the organization.
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Security In The cloud

Section Summary a number of respondents and interviewees mentioned security concerns as weighing into their decision-making process about cloud-based solutions. We asked about three specific aspects of cloud security. Of those: About 55 percent said fear of losing control of their data was a deciding factor when weighing cloud solutions. Nearly 61 percent said the same about unauthorized access to their data. About 61 percent said reliability of access to their data was a deciding factor. Another 59 percent volunteered concerns about security when asked open-ended questions about the disadvantages of the cloud. When you mention the cloud, people tend to express their concern about the safety and security of data stored there. A whopping 59 percent of survey participants who volunteered information about disadvantages of the cloud cited some variation of data control, security, privacy, or access. In addition, four intervieweesincluding all the expertsmentioned security issues as well, both perceived and actual. given the string of high-profile computer security breaches in 2011, such security concerns arent surprising. Security is a nuanced issue with a number of facets, but many nonprofit staff members dont have a very nuanced understanding of it. In response to a question about security, for instance, one interviewee said, If you watch any movies or TV, you know anyone can access your information online. The experts we interviewed said this type of statement is almost completely unfounded, but its typical of the feelings of a substantial number of the nonprofits included in the research. About 21 percent of those who volunteered information about the disadvantages of the cloud mentioned simply the high level concept of security, often verbatim, with no details behind their concerns. There is little evidence, however, that cloud-based solutions pose any more risk than any other system connected to the Internet. When you break security down into its component parts, you see a more complex view. The most commonly cited facet of security is ensuring that unauthorized people cant access your data. Unauthorized access exposes a system to myriad threats. A hacker might access your system, threatening the confidentiality and privacy of your data, or someone with unauthorized access might change your data, which can be hard to detect and can destroy trust in the information you own. Nearly 61 percent of survey respondents rated unauthorized access as a key factor in software selection.
Case Study: The cloud Doesnt Matter if it Doesnt have the Features
a vendor assured this Texas human service organization that its collaboration software for a project would reduce the amount of time staff needed. Once the hosted software was implemented, however, the opposite proved trueit took more staff time rather than less. While the organization is not happy with this cloud-based solution, it continues to use other hosted solutions, including staff email and constituent database. The message? The cloud is growing in popularity, and is touted as a technological panacea, but like installed software, it is still not without its faults.
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concerns about Specific aspects Of Security

We considered it, but it wasn't a top priority This was/would be a deciding factor
80% 60% 40% 20% 0%

can we keep unauthorized people from accessing our data?
13.06% 60.82%
13.32% 16.01% 61.08% 55.44%
Will we loose control of our own data?
Will our staff have reliable access to our data?
Theres a trust relationship with the vendors who have your datayou need to decide who to trust. I use Dropbox, and I trust it a lot, but why? Why do I trust them not to sell my files? Im not sure, exactly.
Table 14 Percentage of respondents concerned about security when selecting software.
Again, the experts we interviewed felt that nonprofits fears about unauthorized access were generally unwarranted. In fact, they believe the cloud offers increased security options over many traditional methods. Despite the media attention devoted to high-profile security breaches, the number of such breaches has gone down in recent years.1 In addition, cloud-based solutions face the same risks as any other internet connected machines, including those located on an organizations premisesfor most small-to-medium sized nonprofits, theres no reason to suspect that data stored in the cloud will be less secure than data stored onsite. In fact, one expert we interviewed suggested that organizations could even outsource security factors, such as hIPAA privacy requirements or credit card PCI compliance, to vendors who can prove that their systems meet these regulatory standards. The idea is that while most systems today are exposed to the dangers of the Internet, many cloud vendors have better capacity than customers to keep information safe. One user agreed, and said she had no faith in [her organizations] ability to keep people from hacking its computers. Reputable online vendors tend to take far more security precautions than a nonprofit could reasonably take. One exception to this, as a consultant pointed out, is an organization that might need to protect its data against government subpoenas. No vendor will resist a subpoenaif your organization would consider resisting, thats a great reason not to put your data in the cloud. Another critical element of security is the reliability of access to your online datafor instance, how likely is it that youll lose Internet access and be unable to reach the service? Or that the vendors service will go down for hours, or days? Or out of business altogether, taking your data with them? About 61 percent of the survey respondentsa similar number to those that were concerned about unauthorized accessfelt that reliability of access was a major consideration when thinking about hosted software. Our experts agreed that this is a real and substantial concern, especially when it comes to Internet access. Stable, high-speed Internet is taken for granted in major metropolitan areas, but its often spotty or nonexistent in less-densely populated parts of the country. To many organizations on the rural side of this digital divide, Internet access beyond dial-up connections may be a prohibitively expensive luxury, if its available at all. Cloud solutions are not generally a great option for nonprofits without a reliable Internet connection.
1 Computer Security Institute 15th Annual 2010/2011 Computer Crime and Security Survey, p. 2 Respondents reported markedly fewer financial fraud incidents than in previous years, with only 8.7 percent saying they'd seen this type of incident in the covered period.
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Its also important to determine a cloud vendors track record in terms of uptime and reliability. While a large vendor with a redundant infrastructure will likely make access to your data at least as bulletproof as your power or Internet access, smaller vendors could have more significant issues in this area. Nonprofits in our survey also mentioned concerns about their data if the vendor goes out of business. Our experts agreed that this risk is legitimatenonprofits should backup their data and vet the likelihood that their vendor will be around for the long term.
for some respondents, control might refer to an unspecific fear stemming from not being able to physically touch the computers that house their organizations data. for others, it refers to a vendors automatic updates while not having to perform software updates is often perceived as a benefit of cloud solutions, it can be an issue when the updates arent desirable, or come at the wrong time. for example one interviewee mentioned that users at her organization arent happy with some of the recent changes to her cloud solution. Similarly, a survey respondent said her organizations installed database was definitely an advantage compared to a hosted solution, because it offered control over access, updates, timing and training opportunities. Interestingly, concerns about cloud security didnt appear to broadly deter adoption of hosted solutions among our survey respondents. After all, while 59 percent of survey participants mentioned that security issues were a downside of cloud solutions, over 91 percent of them were using them anyway. Perhaps nonprofits have different perceptions of the security risks of different types of cloud software packages? After all, the risks of using a hosted solution for sensitive constituent or accounting data might be perceived very differently than those for an organization using it to store photos or send broadcast emails.
About 80 percent of our staff are field staff, so they are out and about in very remote areas. Some areas that we service still have dial-up for Internet access, and there is no cellular phone service. This is a big hurdle for us.
We also asked people whether they felt that control over their data was a significant concern. About 55 percent of people who responded to this question said it was. As an agency of the State of Texas, my organization insists on retaining control of all software and data, said one respondent. her organization probably has very specific policies and procedures for data protection that are more easily checked and verified when systems are inhouse. But shes not alone in her concern.
What happens if the company is suddenly no longer in business or discontinues service? What happens to your data?
Its certainly worth considering, though, if security concerns could have an impact on adoption of systems by staff members. After all, if staff wont use your systems in the cloud, it doesnt matter if theyre actually secure or not.
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considering return On Investment

Section Summary Return on Investment did not appear to be a significant factor among respondents when choosing cloudbased solutions: 8 percent said they measured ROI substantially. 26 percent said theyd looked at ROI somewhat. Very few people included in this research were evaluating the Return on Investment of a cloud solution. Only 8 percent of those surveyed said they were substantially measuring, while another 26 percent said they had looked at ROI somewhat. The numbers of those truly measuring ROI could be even lowerwe interviewed two survey respondents who said they were measuring ROI, but neither had actually done so. One had not yet started a planned analysis, while the other said her cloud solution was free to use, and that she was happy with it. Its possible she considered the value she derived from her free solution a positive Return on Investment, but she did no formal measurement. The consultants we interviewed agreed that ROI is seldom measured. One suggested this might be because few nonprofits have measured the before picture and thus have nothing to compare when they make the switch to the cloud. It may be that measuring ROI takes staff time that organizations, particularly small and medium size nonprofits, find hard to justify when weighed against activities that produce clear and immediate results.
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conclusion: What Does This Mean For Your Organization?

Cloud-based software might seem like a new concept, but its notits the evolution of software accessed over the Internet, which weve used in one form or another for a decade or more. for some nonprofits, however, the mindset with which they approach the software has changed. Cloud solutions provide nonprofits with the opportunity to outsource somethinglike the maintenance of servers and software that may not be their organizations core competency. As opposed to thinking of IT infrastructure as a fact of life, some organizations are beginning to think about it like electricitysomething that you can rent rather than create yourself. you could put a generator in your basement to produce your own electricity, but then youd have to run and maintain it yourself. In most cases, its more cost effective to simply pay the power company for electricity. Similarly, it may be more cost effective to pay a vendor for the use of their servers and software than to run and maintain your own.2 One consultant we interviewed said, Eventually, people will stop saying cloud, because everything will be there. he might be right, but its too early to predict the future of cloud computingits not yet ubiquitous, but already its more than a fad. Traditional software vendors like microsoft now offer online versions of many of their products, and in niche areas, like donor management software, new entries to the market have been almost exclusively cloud-based. Internet security remains a legitimate concern. however, it shouldnt be a reason to avoid the cloud altogether. Cloud solutions are no less secure than any other computer connected to the Internet. This includes your own servers and computers, which are often far less protected from online and other dangers than you may believe. Realistically, a vendor who specializes in keeping data secure can do a far better job of it than the typical small- to medium-sized organization. Some nonprofits might even outsource security by using a cloud vendor compliant with any regulations theyre subject to, like hIPAA or credit card PCA requirements.
Case Study: confidence from the cloud

Jessica, the director of a small animal shelter, uses PetPoint, an online, cloud-based system to help track the organizations in her care. as theres no one responsible for IT at her organization, Jessica discovered the solution herself at a Las Vegas trade show after the vendor of the installed package she had been using went out of business. Shed had so much trouble with computers crashing and lost data that a hosted option seemed to make more sense than installed software. For security, tooshe said she had no faith in her organizations ability to keep people from hacking into its computers. I feel data is more secure with PetPoint. They have more capability to keep things secure. a problem would screw with their reputation. her shelter uses the tracking system in conjunction with a blog to post photos and stories of pets that need adoption. Jessica feels its helped her organization to reach out to the community and find homes for animals. The downside? Everyone brings us animals, she said. Were overwhelmed with cats right now.
2 This metaphor is courtesy Nicholas Carr, The Big Switch: Rewiring the World, from Edison to google" 2008
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Very few nonprofits included in our research had measured the specific ROI or impact of using cloud software, but the vast majority said they believe the solutions have been helpful. We asked survey recipients who had recently decided to move to a cloud solution about the impact of that product on their mission80 percent of those who responded said the impact was generally positive, while just 7 percent felt it was negative. The four experts we interviewed all agreed that, while it was difficult to tie cloud computing directly to mission impact, using cloud solutions can help nonprofits decrease their technology infrastructure and thus devote more resources to their core mission. This could allow many organizations to focus more on the strategic and mission implications of technology rather than the nuts and bolts of everyday maintenance. While cloud computing can be a boon to many organizations, its not a panacea. As one consultant put it, its a mistake to think that the cloud fairy dust has taken away all the problems that ever existed with software. In the end, cloud software is just software. Its critical to evaluate the cost, features and value of each individual product rather than make decisions solely on the way its delivered. your organization may find, for example, that a particular installed solution has exactly the features you need, while the cloud solutions you look at dont or vice versa. In that case, its irrelevant whether the product is in the cloud or not, as only one solution meets your requirements. like any other type of software, all you can do is compare your needs to whats available. Are the typical benefits of the cloudlike remote access, decreased maintenance and automatic updatesactually of value to you? To what degree are you concerned about typical downsides, like the inability to access the software package when your Internet connection is down, or less control over the timing and content of updates? how do the costs compare across your different options? And fundamentally important: What particular software package will work best for your organization?
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about the authors

Jay Leslie, Idealware. As Senior Researcher at Idealware, Jay is responsible for researching software choices through demos, interviews and surveys, and using that information to create easy-to-use resources. he brings to his role 15 years of experience in information technology management in the nonprofit and philanthropic sectors. Prior to Idealware, Jay was an IT executive at the Atlantic Philanthropies, where he led several major software selection and implementation projects. Kyle andrei, Idealware. As a Researcher at Idealware, Kyle is responsible for survey research, data analysis and writing, and serves as a subject matter expert on multimedia production and advocacy topics. Prior to joining Idealware, Kyle split his time between managing Indiana State Universitys student radio station, researching video game communication and working on local elections. Laura Quinn, Idealware. laura has been working in the software sector for more than 15 years. As Idealwares Executive Director, she directs Idealwares research and writing to provide candid reports and articles about nonprofit software. Prior to Idealware, laura founded Alder Consulting, where she helped nonprofits create Internet strategies, select appropriate software, and then build sophisticated websites on a limited budget. She has also selected software, designed interfaces and conducted user research for multimillion dollar software and website implementations with such companies as Accenture and iXl.
about Idealware
Idealware, a 501(c)(3) nonprofit, provides thoroughly researched, impartial and accessible resources about software to help nonprofits make smart software decisions. By synthesizing vast amounts of original research into credible and approachable information, Idealware helps nonprofits make the most of their time and financial resources. Idealware specializes in combining traditional research techniques like interviews and surveys with software-selection methodologieslike detailed ratings of software tools against a rubricto generate important new knowledge on affordable budgets. We then package our findings into approachable reports, articles, and trainings that help nonprofits make the on-the-ground decisions important to them.
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about NTEN a community Transforming Technology Into Social change

www.nten.org
Who We are A community of nonprofit professionals, we aspire to a world where nonprofit groups of all types and sizes use technology strategically and confidently to fulfill their missions. Together, the NTEN community helps members put technology to work so they can bring about the change they want to see in the world. What We Do NTEN connects members with one another and offers many opportunities for learning and professional developmentall so you can focus on achieving your goals and meeting your mission. how We Do It NTEN helps members, with their diverse job functions and levels of tech comfort and expertise, share best practices, and glean insights from one another both online and off: training, research and industry analysis, regional meet-ups, our signature Nonprofit Technology Conference. As a member, you gain instant access to a supportive community that shares your passions and challenges, as well as to valuable resources for professional development. connect Online Networking / www.groups.nten.org Whether youre a webmaster, marketer, executive director, fundraiser, blogger, program manager, or play another role in the nonprofit sector, connect with your peers online. Join our Affinity groups and social networks, browse the member Directory, post in our online forums.
Events / www.nten.org/events NTENs Nonprofit Technology Conference and local meet-ups bring nonprofit professionals together to share ideas and best practices. get to know colleagues. Develop a support network. Talk shop. Vent. Congratulate. Collaborate. The possibilities are endless. Learn NTEN Webinars / www.nten.org/webinars Changing the world isnt easy. NTEN members are always looking to learn more about how to use technology to further their missions. gain a wealth of knowledge without ever leaving your desk through NTENs extensive schedule of live webinars and archived events. NTEN research / www.nten.org/research NTEN collaborates with renowned industry, academic, and nonprofit partners to conduct research on key subjects related to nonprofit technology like IT staffing and spending, salaries, social networking, and data ecosystems. Our reports and benchmarks studies offer actionable data and invaluable insider information. change NTEN: change / www.nten.org/ntenchange NTEN: Change is a quarterly journal for nonprofit leaders. youll find guidance on the strategic and practical considerations necessary to make the sound investments and decisions that will help your organization achieve its mission. NTEN connect newsletter / www.nten.org/signup Read how NTEN members are fulfilling their missions and changing the worldand how you can too. The free monthly NTEN Connect newsletter brings you solid advice, success stories, and best practices related to technology and the nonprofit sector.
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appendix a: research Methodology

In August 2011, NTEN, with Idealware, conducted a survey of nonprofits to learn more about the use of hosted, or cloud, software solutions in the nonprofit sector. Survey participants answered questions about how many cloud solutions they were using at the organizational level, what types (selected from a list of 10 common software types), and how long they had been using each solution. for the full text of the survey, see Appendix C. We distributed the survey nationally through eight individual nonprofit state associations (Arizona, Arkansas, Connecticut, montana, michigan, Pennsylvania, North Carolina and Texas). While some states had greater representation than others, all regions were represented, and we have no reason to believe the results were biased toward any particular region in any way that would affect the survey results. The invitation to participate specified that the survey was intended for each organizations technology decision makeras a result, though participants in many different roles took the survey, the majority were executive directors. In all, 780 people out of the 23,787 we contacted responded, for a response rate of 3.2 percent. Survey recipients were invited to take a survey about their technology, and in return, be invited to a series of free online trainings. We specifically designed the outreach strategy to reach organizations that had not previously said they were interested in technology. given the informal nature of the outreach, however, and our low response rate (by research standards), its probable that people who were interested in technology were more likely to take the survey. This means our sample should be considered somewhat indicative of nonprofit trends, but not a representative sample of nonprofits nationwide. The survey concluded by inviting respondents to participate in additional research. Of the 130 people who consented to being contacted, we reached out to roughly 70, each representing a different sub-section of overall respondents. Ultimately, we narrowed that pool of participants down to six nonprofit staff members for interviews. These staff members came from organizations of all sizesboth with and without dedicated IT staffthat use multiple cloud solutions, are early cloud adopters, that measure the Return on Investment of their cloud solutions, or that specifically decided against using cloud-based solutions. In addition, we interviewed four consultants who work primarily in cloud technologies to determine the major strengths and weaknesses of the cloud from an industry perspective.
26
appendix B: Demographics
A total of 780 people responded to the survey. Of those, 213 worked at human service organizations, which, with 28.2 percent of responses, was the largest focus area represented. The remainder of the responses were widely distributed between other focus areas. Neither the results of the survey nor the use of cloud solutions revealed no strong trends around an organizations focus area. Of all respondents, 341 worked at organizations without dedicated IT staffover 43 percent of the survey sample, the largest by a wide margin. Of those respondents whose organizations did have IT staff members, very few had more than one person, and only 10 participants had an IT staff of 10 or more. Organizations were fairly evenly distributed according to age, but were most likely to be between 20 and 40 years old. Relatively few participants organizations were recent start-ups, and just over 100 organizations were younger than five years. Budgets were fairly evenly distributed through the small and medium range, but tended toward the smaller side. By a narrow margin, organizations were most likely to be operating on an annual budget of $100,000 or less. Very few organizations were in the highest tiers ($10 million a year or more), and very few were operating at no annual budget or with an all-volunteer staff. Almost 32 percent of participating organizations employees worked from only one office or location, and just under 25 percent had employees working from three or four locations. There was no relationship between the number of offices or locations maintained by an organization and its use of cloud software solutions.
27
appendix c: Survey Text

Thank you for participating in this survey. NTEN and Idealware have created this survey to assess the extent of and use of cloud computing in the nonprofit sector. for the purposes of this survey, cloud computing refers to hosted software and/or technology infrastructure, which is shared by many users and accessed online or through a browser. Upon completion of this survey, you will also have the opportunity to participate in a series of free webinars. Page 1 1. What best describes your organization's primary issue area? Arts/Culture Civil Rights/Advocacy Education Employment Environmental health housing human Services International legal Public/Social Benefit faith-Based youth Other (please specify) 2. about how many IT staff members does your organization have? No one is responsible for IT About 1/4 time person less than a full time person 1 full time person 2 full-time people 3 to 5 full-time people 6 - 10 full time people 10 or more 3. about how long has your organization existed? one year or less one to five years five to 10 years 11 to 20 years 21 to 40 years 41 to 75 years more than 75 years 4. What is the approximate annual budget of your organization? none - all volunteer below $100,000 $100,000 - $250,000 $250,001 - $500,000 $500,001 - $1 million $1 - $2 million $2 - $5 million $5 - $10 million $10 - $25 million $25 - $50 million more than $50 million 5. In which state is your organization's headquarters? Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia florida georgia hawaii Idaho Illinois Indiana Iowa Kansas Kentucky louisiana maine maryland massachusetts michigan
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minnesota mississippi missouri montana Nebraska Nevada New hampshire New Jersey New mexico New york North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee
Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Other
6. From about how many locations does your organization work? (offices, home, telecommuting) 1 2 3 to 4 5 to 8 9 to 15 more than 15 I don't knowAny other solutions you access through a browser?
7. are you currently using a hosted service that you access over the internet for any of these things? Used for Used for more than 1 to 3 3 years years Photo sharing (e.g. flickr) Oce software (e.g. word processing, spreadsheets, etc.) Phone system or voicemail Broadcast email to constituents Accounting system Document storage Collaboration software Data backup Constituent database Sta email Used for less than 1 year considering No plan to use Don't Know
29
8. Did your organization make a decision to use a particular hosted software package in the past year? yes no don't know Page 2 This page was only seen by respondents who answered either no or dont know to Question 8 9. have you specifically decided against using one or multiple hosted software solutions for your organization? yes no don't know
Page 3 This page was only seen by respondents that answered yes to Question 8. 10. What type of hosted software did you most recently choose? Data backup Broadcast email to constituents Constituent database Office software (e.g. word processing, spreadsheets, etc.) Collaboration software Photo sharing (e.g. flickr) Document storage Accounting system Phone system or voicemail
11. When comparing your software options for that choice, how did the following concerns factor into your decision making? This was a deciding factor The cost of converting from our previous software The time it takes to train our sta to use this The time it takes for our sta to use the software The total cost over time The ability to work with my other existing applications The ability to work remotely The time it takes to maintain the software We considered it, but it wasn't a top priority There was very little dierence between our options This wasn't a consideration
30
12. When comparing your software options, how did the following security concerns factor into your decision making? This was a deciding factor Can we keep unauthorized people from accessing our data? Will we lose control of our own data? Will our sta have reliable access to our data? 13. has your organization measured the return on Investment of your hosted software in comparison to other, installed solutions? We have not measured this We have looked at this somewhat We have been substantially measuring this 14. have you found any specific advantages for your organization in using hosted solutions over installed? If so, what? 15. have you found any specific disadvantages for your organization in using hosted solutions as opposed to installed? If so, what? 16. Do you feel that the hosted solutions you use help your organization meet its mission? If so, how? 17. as a thank-you for completing this survey, NTEN and Idealware would like to invite you to a series of three free webinars. Would you like to be invited to participate in these webinars? yes, I would like to be invited No, thank you 18. after this survey, we are doing additional research into the use and prevalence of cloud software in the nonprofit sector. are you willing to be contacted to participate in a focus group? yes, I am willing to be contacted No, I do not wish to be contacted 19. Name 20. Email 21. Organization Page 4 This page was seen only by those that answered yes to Question 8. We considered it, but it wasn't a top priority There was very little dierence between our options This wasn't a consideration
31
22. When comparing your software options, how did the following concerns factor into your decision making? This was a deciding factor The time it takes to train our sta to use this The time it takes to maintain the software The time it takes for our sta to use the software The cost of converting from our previous software The total cost over time The ability to work remotely The ability to work with my other existing applications We considered it, but it wasn't a top priority There was very little dierence between our options This wasn't a consideration
23. When comparing your software options, how did the following security concerns factor into your decision making? This was a deciding factor Can we keep unauthorized people from accessing our data? Will we lose control of our own data? Will our sta have reliable access to our data? We considered it, but it wasn't a top priority There was very little dierence between our options This wasn't a consideration
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24.What other concerns do you have regarding hosted software? 25. as a thank-you for completing this survey, NTEN and Idealware would like to invite you to a series of three free webinars. Would you like to be invited to participate in these webinars? yes, I would like to be invited No, thank you 26. after this survey, we are doing additional research into the use and prevalence of cloud software in the nonprofit sector. are you willing to be contacted to participate in a focus group? yes, I am willing to be contacted No, I do not wish to be contacted
27. Name 28. Email 29. Organization Page 5 This page was seen by the participants who answered no or dont know to Question 8.
30. When choosing between a hosted software package and an installed software package in general, what are the major factors you would consider? This would be a high priority factor for us The time it takes to train our sta to use this The cost of converting from our previous software The time it takes for our sta to use the software The cost of converting from our previous software The total cost over time The ability to work remotely The softwares ability to work with my other existing applications This would be a factor we would consider There's likely to be little dierence between our options This would not be important I don't know
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31. When thinking about hosted software, how do you feel about the following security concerns? This is a major concern The time it takes to train our sta to use this The time it takes to maintain the software The time it takes for our sta to use the software The cost of converting from our previous software The total cost over time The ability to work remotely The ability to work with my other existing applications 32. Do you think there are any specific advantages for your organization in using hosted solutions over installed? If so, what? 33. Do you think there are any specific disadvantages? If so, what? 34.as a thank-you for completing this survey, NTEN and Idealware would like to invite you to a series of three free webinars. Would you like to be invited to participate in these webinars? yes, I would like to be invited No, thank you 35. Name 36. Email 37. Organization This is important, but not as much as other concerns This is the same as other types of software I have not thought about this
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2012 State of The Cloud Report

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The State of the Nonprofit Cloud: The Results of a Study of Nonprofit Use of Cloud Software

An NTEN Report Prepared by Idealware

Origin of the cloud

Case Study: The Invisible cloud

how are Nonprofits Using The cloud?

Document accounting Phone storage system system or voicemail

Case Study: Moving to cloudBased Staff Email

services like Gmail and Google Apps a sort of gateway cloud.

More than 3 years

100% 80% 60% 40% 20% 0%

Table 2 how long organizations have been using the cloud.

More than 3 years

100% 80% 60% 40% 20% 0%

Case Study: Moving Finance to the cloud

how Long have Organizations Been Using The cloud?

100% 80% 60% 40% 20% 0%

32.54% 46.35% 48.41% 40% 26.18% 35%

Case Study: Board collaboration in the cloud

adoption of cloud Solutions

Number of cloud solutions

Table 7 Percent of respondents, by IT staff size, using multiple cloud solutions.

Table 6 Number of cloud solutions used by organizations.

Why are Nonprofits choosing cloud Solutions?

80% 60% 40% 20% 0%

This was/would be a deciding factor

21.27% 48.87% 22.95%

Percent of respondents 42.75% 23.91% 8.33% 6.16% 1.81%

80% 60% 40% 20% 0%

This was/would be a deciding factor

23.98% 42.08% 18.03% 27.87%

Organizations that did not recently selecet a cloud solution

Table 10 - Time spent maintaining software as a factor for selection.

80% 60% 40% 20% 0%

This was/would be a deciding factor

19% 56.56% 14.75% 39.34%

Organizations that decided against a cloud solution

Organizations that did not recently selecet a cloud solution

Case Study: To the cloud, For cost Savings

80% 60% 40% 20% 0%

18.04% 13.57% 36.65% 18.03% 36.07% 50.90%

Organizations that decided against a cloud solution

Organizations that did not recently selecet a cloud solution

We considered it, but it wasn't a top priority

60% 50% 40% 30%

27.78% 21.13% 16.77% 18.95%

The time it takes to maintain the software

The time it takes for our staff to use the software

The cost of converting from our previous software

The total cost over time

The ability to work remotely

The ability to work with my other existing applications

Security In The cloud

concerns about Specific aspects Of Security

80% 60% 40% 20% 0%

13.32% 16.01% 61.08% 55.44%

Will we loose control of our own data?

Will our staff have reliable access to our data?

Table 14 Percentage of respondents concerned about security when selecting software.

considering return On Investment

conclusion: What Does This Mean For Your Organization?

Case Study: confidence from the cloud

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