How Much are Nonprofits Spending on IT?

Submitted by Annaliese on Tue, 06/21/2011 - 8:35am

How much are nonprofits spending on IT, and what are they choosing to spend it on?

In our annual Nonprofit IT Staffing and Spending Survey, we asked respondents to describe the components of their organizations’ IT budgets—everything from Overall Expenditures to what proportion they allocate for Staffing, Capital, Consulting Contracts and Other Discretionary Expenditures.

Here’s what we learned:

  • The median budget for IT expenditures for all survey respondents was about $56,000.
  • The average budget for all IT expenditures was about $431,000.
  • On average, organizations devoted 2.7 percent of their budget to IT.
  • Small orgs devoted the largest portion of their overall budget, at 7.1 percent, with an average IT budget of just under $17,000.

Where is the money going?

As you can see from the table, for most organizations, the money is going to IT Contracts, followed by Discretionary Expenditures, and Software or Cloud Expenditures—this is true for organizations of all sizes.

Another important finding for us this year was that the percent of the overall budget devoted to IT dropped for organizations of all sizes compared to the previous year's data:

  • for Large and Very Large organizations, it dropped only slightly.
  • for Medium organizations, it dropped noticeably (from 6 percent to 3.4 percent).
  • for Small organizations, it dropped considerably (from 14 percent to 7.1 percent).

While we can't draw direct year- over-year conclusions from this because we don't control the survey particpation each year, we suspect that the economic downturn affected nonprofits' IT spending habits over the last year, and that smaller organizations saw the most significant impact to their IT budgets.  But there are other possible factors for the decrease, including increasing use of cloud and lower-cost technology solutions for more organizational functions, especially for smaller organizations.

You can download the complete report, which includes more information about budgets, staffing, and planning and ROI practices for free.

> Download the 2010 IT Staffing and Spending Survey Report. It's Free!

We'll be conducting the report again at the end of this year and would like to hear your feedback about what other data we should be tracking and ways we can improve this resource for your organizational use. Please leave your comments below!