Nonprofits Innovate with Drone Technology

Drones: a technological development whose connotation has evolved from mysterious military weapon to an everyday recreational consumer good with a growing array of practical applications. Improved and cost-effective designs have shrunk the price for basic models to around $500. This has led to a rapid proliferation of the devices – also known as Unmanned Aerial Vehicles (UAVs).

While U.S. businesses (including Amazon, which expressed interest in developing a drone delivery service) have had their drone plans shelved by a federal government uncertain of how to regulate commercial usage, nonprofits and humanitarians around the world have been quick to adapt the remote-flying devices for their work.

PETA uses drones to monitor illegal hunting practices in Upstate New York. The organization has even branded drones with their logo, selling them to activists. A Belgian engineering graduate named Alex Momont designed an “ambulance drone,” which will enable medical professionals to deliver defibrillators to cardiac arrest victims in remote or obstructed areas. Doctors Without Borders enlisted the help Matternet, a Silicon Valley-based drone company, to figure out how to transport tuberculosis samples from remote communities to urban testing centers.

This recent burst of innovation and integration of drone technology appears to be the start of a trend. Staff at the nonprofit Global Medic predict a number of other applications for disaster relief, including search and rescue operations, mapping damaged infrastructure, and tracking population movements. Environmental groups are also exploring the utility of UAVs; a group called ConservationDrones is raising money to develop a fleet to monitor endangered animals, such as the elusive snow leopard.

Right now, nonprofits that possess modest numbers of drones face minimal regulation. The nonprofit Texas Equusearch brought a case against an FAA employee who ordered the organization to cease its drone operations. After review, a panel of judges from the Federal Appeals Court threw out the case stating that there is no legal justification or precedent that prevents the nonprofit from using drones.

That might soon change, however, as the technology faces tougher scrutiny in the wake of high-profile incidents underscoring the danger and potential criminal applications of drone technology.

On Monday, January 26, a UAV crashed on the Whitehouse lawn. A drunk employee of the National Geospatial-Intelligence Agency was operating the drone from a nearby apartment building and steered the device over the Whitehouse fence. While this incident did not pose a direct threat to the president or his family, it occurred just days after the Department of Homeland Security held a conference that demonstrated how easily a terrorist could use UAVs to deliver explosives.

A number of other cases have officials mulling over security risks. In France, drones have been seen flying above nuclear reactors. In South Carolina, a drone carrying phones, drugs, and tobacco for inmates crashed at a correctional facility.

Some proposed regulations would mandate safety protocols programmed into drone firmware, which would render drones non-operational or send them back in the direction of their users the moment they entered restricted airspace. The Chinese company DJI – designer and producer of the model used in the Whitehouse incident (pictured above) – announced that it will program such firmware, and that they will develop further programming to prevent drones from flying over national boarders.

This self-regulation, however, will not prevent the inevitable. Specialists agree that these safety configurations are easily hacked, and that with individuals would be capable of circumventing them with minimal know-how. Other controls will be needed to safeguard against misuse.

To what degree drone usage will be regulated remains unclear. One proposal would require users to hold flying licenses, a measure that the Washington Post describes as “overkill.”

Nonprofits should continue integrating technological innovations like drones into their operations. While organizations should also anticipate the conversation around regulation to gain momentum this year, that should not prevent them from demonstrating how technology – when responsibly used – can make profound, positive impacts on the world.

Philadelphia Charities to Benefit from Pope’s Visit

[Leading up to Pope Francis’ visit to Philadelphia in September, Shaping the Story will provide regular updates on nonprofit and charity issues as they relate to the pontiff’s first U.S. trip]

Visiting the Philippines on January 18, Pope Francis brought fellow catholics out in droves.

An estimated 6 million people attended what has been officially declared the largest Catholic mass ever held in the county. Appearing in a modest, inexpensive yellow poncho, the Pope spoke about society’s responsibility to children.

The world was moved in particular by his response to an orphaned street girl who had been rescued by a church-run foundation. “Why is God allowing something like this to happen, even to innocent children? And why are there so few who are helping us?” the 12-year old girl asked.

The ever-empathetic Pope responded, “Only when we are able to cry are we able to come close to responding to your question…Those who are discarded cry. But those who are living a life that is more or less without need, we don’t know how to cry. There are some realities that you can only see through eyes that have been cleansed by tears.”

Pope Francis also paid homage to Catholic nonprofit institutions, stopping at Manila’s Catholic university and spending 20 minutes with the father of a volunteer for Catholic Relief Services who died the day before from collapsing scaffolding in the seaside city of Tacloban.

The Pope’s popularity is unquestionable. He has achieved a rock star status, including in the United States, where he has even adorned the cover of Rolling Stone. A Pew Research Center poll shows that around 80 percent of U.S. Catholics – who will finally have an opportunity to see the pontiff during his first U.S. visit this coming September – have a favorable view of Pope Francis.

The focal point of the visit is the World Meeting of Families, scheduled for September 22 through 25 in Philadelphia. Following the conference, millions of people will flock to the Benjamin Franklin Parkway to hear Pope Francis speak on the steps of the Philadelphia Art Museum. The Vatican’s itinerary will also include either a visit to a children’s hospital or to a juvenile prison facility.

The visit presents a unique opportunity for Philadelphia-based nonprofits to galvanize their volunteers and supporters and to reposition their fundraising strategy and messaging for greater results, as the Archdiocese has already done by laying the groundwork for an ambitious year.

On January 20, Archbishop Charles J. Chaput of Philadelphia announced a $10 million fundraising goal for the annual Catholic Charities appeal – the chief source of revenue for charitable Catholic activities aiding some 200,000 people through 80 programs. Archbishop Chaput has helped turnaround the region’s Catholic fundraising practices since he entered his position in 2011, surpassing $10 million in fundraising in both 2013 and 2014. The added excitement of the Pope’s visit should make this year even more profitable.

With the media attention, as well as the millions of energized Catholics (and non-Catholic philanthropists no less enthralled by the Pope’s presence) descending on the city, Philadelphia-based Catholic charities and nonprofits should follow the Archbishop’s lead and leverage the Vatican’s visit for 2015 fundraising. The pope’s message of charity, in conjunction with his popularity, will provide fuel for nonprofits’ invaluable basic needs work.

Fundraising Progress in Ebola Fight

In September 2014, several reports explored the difficulty that fundraisers were having as they struggled to raise money for the fight against ebola. A number of factors – from the seeming remoteness of the disease in Africa, to the expectation for the government to simply deal with these sort of issues – left people in a state of passivity, while the disease continued to ravage cities in West Africa and NGOs battling the disease were left with increasingly steep bills.

Then there were scares at home. Here in the United States, a couple of cases brought the reality of the disease to the attention of the nation’s news media. A man in Dallas, having travelled to Liberia, passed away from the disease in a Texas hospital. A New York doctor contracted the disease while working abroad and caused a stir by having a night out on the town shortly before the symptoms appeared (the disease only being contagious, of course, once a carrier is symptomatic).

But as time went on and no new cases popped up, the fear dissipated – and so did the media attention.

While the disease still threatens many communities in West Africa, the situation has certainly improved. In conjunction with the brave work of many NGOs – as well as government personnel from a score of nations, including the United States and Cuba – donors finally broke the dry spell last fall by opening their wallets. Beginning with high profile philanthropists from the tech sector, the flush of fundraising and government-vowed assistance at least partially ameliorated the peak level of carnage wrought by the virus. Now, Mali is ebola-free, and Liberia and Guinea are moving to reopen schools in the coming months.

Bill Gates began the big donor trend in September 2014, when he committed $50 million to fight ebola. He donated another $5.7 million in November. Facebook CEO Mark Zuckerberg and his wife followed suit, pledging $25 million to the cause last October.

Facebook went on to initiate a crowdsourcing campaign to raise money for ebola. Big tech is also providing logistical support for the effort, as recent news out of the Davos summit reveal that a collaboration of companies including NetHope, Facebook, Cisco, and Inveneo will work to provide reliable internet connectivity to support NGO work in Sierra Leone, Liberia, and Guinea.

Compared to fall 2014, there also appears to be a significant increase in bottom-up fundraising: a Liberian student at Eastern Mennonite University is teaming up with Nobel Peace laureate Leymah Gbowee to raise money; organizers in Winnipeg are putting together a concert to benefit children orphaned by the disease; to date, the crowdfunding site GlobalGiving has helped raise $3 million for 29 community organizations on the frontline of the fight against ebola.

The path to eradicating this horrible virus is still long and difficult, but global efforts that arose from the uproar over the initially weak and non-unified response to the disaster appear to be making a very tangible impact.

Cyber Security and Nonprofits

Goodwill – a nonprofit that provides job training and services to people with disabilities and operates over 2,600 thrift stores – came forward in July of 2014 to announce that the private information of its customers was hacked and stolen. A couple months later, after a security probe initiated by the organization finished up, Goodwill provided a thorough breakdown of the attack.

Hackers accessed the databases of a third-party vendor named C&K Systems, Inc., a company that Goodwill contracts to process around 10 percent of its sales data. The numbers for some 868,000 credit and debit cards were stolen from 330 different thrift store locations in 19 states, plus Washington, D.C. The nonprofit announced that payment card brands reported very few illicit purchases from the stolen numbers in the wake of the hack.

Each year, it seems like the list of businesses and organizations compromised by online fraudsters gets longer. In 2014, victims ranged from retail to food service, utility provider to government agency; Target, Neiman Marcus, Yahoo Mail, AT&T, P.F. Chang’s, UPS, Home Depot, and the U.S. Weather Service make up a partial list of high-profile hacking targets last year.

What happens to the stolen information varies case-by-case. Suspected hackers range from Eastern European crime syndicates and international hacking collectives, to actual governments.

In the case of stolen credit card information, the hackers seldom use the information themselves, fully aware of how easily tracked such behavior would be. Instead, they often peddle credit card information in secretive online forums, where buyers parse through various offers, making purchases and then transferring the stolen information onto the magnetic strips of dummy credit cards. Some criminal rings then make as many big ticket retail purchases as possible before the victim and the bank figure out what is happening.

Other hackers essentially act as digital ransom-takers, evidenced by the recent attack on Banque Cantonale de Geneve, a Swiss bank. On January 9, an international hacking collective known as Rex Mundi announced that they had over 30,000 private emails from customers, and that they would release the information in the bank did not pay €10,000. This small asking price represents a diversification of revenue streams for Rex Mundi and similar hacking groups. Criminal rings use “ransomware” to lock systems, or threaten to release stolen information, and then demand relatively small payoffs before moving on to their next target. Going after many targets and issuing small ransom demands increases the return on the hackers’ thievery.

When a business or nonprofit possesses the private information of its customers, clients, or donors, it carries a great responsibility to ensure optimum privacy and, in the event that it is compromised, the duty to make sober assessments and analyze data breaches with the utmost transparency. Goodwill, perhaps the highest profile nonprofit hacking victim to date, acted most commendably following the theft of its customers’ information. But in a digital wild west of criminal hacking, finger pointing can stand in the way of accurate information.

The Sony hack – in which scores of embarrassing emails, private staff information, and unreleased movies were stolen – created quite a stir. Common speculation held that North Korea was to blame for lashing out over the comedic film The Interview, which depicts a fictional assassination attempt on Kim Jung-Un. This widely-held belief led the United States government to retaliate – digitally. A suspected U.S. cyber attack temporarily cut North Korea’s internet service in late December.

The big issue? Many security analysts agree that the hack likely started with an internal breech, perhaps from a disgruntled employee. Sony made little effort to pursue this line of inquiry, because the popular narrative placing all of the blame on North Korea let the company off the hook. If Sony was directly responsible for the data breach, the company could face lawsuits from employees with compromised information, as well as other legal and financial headaches that were otherwise taken care of by the North Korea story.

Hacking and digital crime affect how consumers perceive and use online services. In response to ongoing security concerns, consumers stand to reevaluate how they share their private information – an essential component of patron and donor relationships with businesses and nonprofits. Following trends in cybersecurity and the state of consumer confidence is essential for nonprofits, in that it allows organizations to spot potential weaknesses before an attack and enables them to prepare a measured and responsible reaction in the event of one.

Red Cross Under Scrutiny

The Red Cross is drawing some bad press following a joint report by ProPublica and NPR concerning the organization’s accounting. An oft-cited statistic – peddled by Red Cross CEO Gail McGovern, among other executives – that the group uses 91 cents of each dollar it raises to provide humanitarian services is false. In 2013, overhead costs comprised 17.5 percent of contributed dollars, or nearly twice as much implied by the claim.

Senator Charles Grassley has called for the Red Cross to “elaborate on how it calculates the facts and figures given to the donating public.” Following the report, the Red Cross altered it’s language to state that 91 cents of each dollar it spends goes into humanitarian services – a statement that ProPublica also labels “misleading.”

The Red Cross is a unique entity. While technically an independent nonprofit organization, the group operates formally as a “federal instrumentality,” which requires the Red Cross to follow congressional mandates for humanitarian assistance. While the organization is not a federal agency, it nonetheless occasionally receives government funding when publicly-raised money is insufficient for particular humanitarian services.

Another idiosyncratic side to the Red Cross is its business structure. The group’s well-known blood drives actually provide it with a salable product from which it profits immensely. The Red Cross sells donated blood to medical providers, often at a lower price than private competitors (as evidenced this year when the Indiana Blood Center lost one-third of its revenue as clients flocked to the Red Cross’ cheaper blood supply).

As pointed out by ProPublica, the Red Cross conflates its blood business with disaster relief. If the two services are separated, actual operating costs show that the organization spends two-thirds of its budget on its blood services. For this reason, the altered claim that 91 cents on the dollar go to humanitarian services is rather spacious. Notwithstanding the value of cheap and abundant blood supplies, its difficult to equate disaster relief with profitable blood drives.

McGovern’s less-than-truthful claim does not match up to the standards of transparency and forthrightness that nonprofit institutions should hold themselves to. Nonetheless, there is nothing remarkably off about the group’s services-to-overhead ratio. Indeed, the Better Business Bureau Wise Giving Alliance states that nonprofit overhead costs should not exceed 35 percent of budget, a ceiling that the Red Cross does not even approach.

Furthermore, the business practices of the Red Cross should not obfuscate the organization’s financial needs. While selling blood is no doubt a profitable enterprise, the organization cannot afford to appear completely self-sufficient. If donors perceive a nonprofit to have a diverse revenue stream that adequately provides the funding necessary for operations, essential fundraising efforts can consequently have worse returns. This threatens the organization with budget shortfalls, as well as a tarnished image for its efficacy and social impact.

The Red Cross should rectify its false statements. But instead of entrenching the value of a humanitarian organization exclusively in dollars and cents, the public should consider the greater impact resultant from the organization’s efforts as the chief inducement for philanthropic giving.

What Low Oil Prices Mean for Nonprofits

The new year has kicked off with even more good news for U.S. consumers. The price of oil has continued its dramatic plummet, presenting unique fundraising opportunities – as well as challenges – for development professionals.

On January 6, the barrel price of gasoline fell below $50 for the first time in six years. The latest decrease follows industry projections that the United States is stockpiling reserves at an astonishing rate, potentially by as much as 700,000 surplus barrels a week.

In a November meeting of OPEC (the Organization of Petroleum Exporting Countries), member nations discussed the possibility of slashing production to limit the glut in international supplies, thereby curbing the spiraling price of crude oil. The cartel, however, opted not to. The decision stemmed largely from the interests of production leader Saudi Arabia, whose desire to maintain a massive market share won out over the appeal of short-term benefits offered by production cuts.

The reasons for the decline in oil prices are manifold, but chief among them is the increase in U.S. energy production. Since 2008, the United States has contributed 4 million barrels of crude oil a day to the global market, which amounts to 5 percent of the daily global production of crude oil. Combined with dismal growth projects for Asia and Europe, this uptick in U.S. oil production has spurred some of the lowest gas prices that the United States has seen in years.

All of these developments benefit the average U.S. consumer tremendously. If nonprofits calibrate their fundraising focus and acknowledge the new spending power of average U.S. consumers, they could increase revenue significantly, and continue to do so for a while; specialists expect no abatement in declining oil prices anytime soon.

Due to falling prices, motorists could save $75 billion on gasoline in 2015. The financial benefit from these savings to U.S. families could reach $1,100 in extra cash, allowing for greater spending and a growth of .3 – .4 percent for the U.S. economy.

General economic growth could in turn lead to more financial security for many U.S. families, emboldening them to give more to charity. And if giving trends during the recession were any indicator, this could bode very well for the nonprofit sector. Poorer and middle-class U.S. citizens increased their yearly giving by 4.5 percent over the course of the recession, whereas wealthier donors scaled back their donations by 4.6 percent.

The resilience of the average American’s giving spirit – in conjunction with an improving economy, greater disposable income, a resurgent dollar, and a growing interest in online giving – could mean that 2015 will be the year of small donors, giving more to make a difference on the issues they care most strongly about.

Declining oil prices, however, have not been a boon to everyone, and will reduce the giving power among certain demographics.

The stock market has taken a shellacking, as news of falling oil prices have led to energy stock selloffs and bearish market projections. On January 5, the Dow Jones Industrial Average fell 331.34 points, or by 1.8 percent. The Nasdaq fell by 72.24 points – amounting to a 1.6 decrease. As Kathy Jones from Charles Schwab notes, declining energy prices are a mixed blessing, as it benefits consumer spending while simultaneously harming investment, which makes up much of the capital wealth propping up petroleum businesses.

Outside of institutional pains felt on Wall Street, certain regions of the country are suffering due to the declining prices. Indeed, U.S. Steel just announced on January 6 that it will idle a plant in Lorain Ohio, putting 614 employees out of work. Energy production has occupied a larger share of the economy than ever before, and the glut of cheap oil spells trouble for certain regional economies. Eight states in particular are projected to suffer as a consequence of falling oil prices. Due to economic dependency on energy production, Louisiana, Alaska, New Mexico, Oklahoma, North Dakota, Texas, West Virginia and Wyoming comprise this group.

The overall impact on the spending (and giving) power of average U.S. consumers will be positive, as disposable income grows across much of the United States – specifically among demographics that have giving more to charity throughout the past five years. Giving levels rarely deviate from around 2 percent of GDP, meaning that, at the very least, charitable giving should grow proportionately along with the economy.

Investors and energy sector workers will take a hit, however, as the stock market retracts and energy companies lay off employees. Nonprofits and development professionals should be mindful of which side of the issue their target demographics fall. By doing so, nonprofits can hone their segmentation and craft better messaging the connects with prospective donors in a manner appropriate to their economic situation.

PricingPrivacy PolicyRefund Policy