The sector is transforming its use of data – but it needs better incentives to thrive

By Giselle Cory, CEO, DataKind UK

Some charities are pioneering the use of data science in the sector; many others are laying the foundations for better management and analysis of data. But almost one in three charities feel they are poor at using, managing, and analysing data. And half believe their ability to use data to plan services is poor. Why?

Many sector leaders lack data confidence

Though good data use is often seen as a technical challenge, the first step to better data use is leaders who want to drive through data-informed practices. Yet we know from the commission report that investing in leaders happens at a rate three times less in the social sector than in other sectors.

The lack of data champions among senior leaders in the sector has a massive knock on effect. Leaders who aren’t confident about what data can do aren’t likely to pioneer change or fight for budgets. This leadership gap includes boards. Trustees are key to driving organisational transformation, but are rarely data-confident. New programmes like Third Sector Lab’s Digital Trustees are beginning to put this right for digital skills, but data skills remain unaddressed.

Access to technical skills at an operational level is also a barrier. The sector finds it hard to plug the skills gap – we see this through our jobs board – but this is likely a symptom of lack of buy-in from sector leaders and funders, rather than the cause. Once leaders are invested in, and investing in, data use, filling the gaps in analytical skills is a secondary challenge.

Sharing stories for success

Though effective data use is an area that many charities struggle with, there are plenty of organisations taking bold steps forward in a sector where good data use remains the exception rather than the norm. Horror stories about unethical or illegal data use – largely from other sectors – drown out the more banal but even more impressive stories of data used responsibly and effectively to make charitable services better, and ultimately improve people’s lives.

Yet these examples are vital to building a shared understanding of the future of data use in the sector: of what works, of what is possible, and of what is right. We are in a unique period of change, when the sector has an opportunity to define what ethical data use means for vulnerable communities, rather than to import the less appropriate approaches from other sectors. But sector leaders need to be empowered, informed and funded to take the lead.

Best practice should be celebrated and shared, so that others can learn from them. (If you are doing good work with data at your charity, share it if you can!) Peer learning networks – like our own Data Collective – can provide a vital role here.

Funders need to adapt

Calls for more and better allocated funding are so commonplace that I hesitate to repeat them. But the funding environment is too important to skip over. As the commission finds, the funding situation for data work is particularly dire. Restrictions on what is and isn’t fundable means that charities often can’t invest in their own infrastructure and skills.

This is frustrating in a sector where funders claim to be working in support of high impact activities. Better date use means better impact – and charities think better funding is the key to boosting their impact – yet this funding is accessible to a tiny minority of charities.

Examples of brilliant funders that invest in digital, data and organisational development are invaluable and it is their funding that is creating a data-informed vanguard in the sector. But for the sector’s 160,000 charities to thrive, we need more than a few bastions of best practice.

Pro bono support is vital – but must be done right

Charities have a big appetite for pro bono support from skilled professionals. There is a rich ecosystem of social sector organisations who provide support to others in the sector, including DataKind UK.

Many businesses also engage directly with the sector to provide pro bono skills, and make a valuable contribution. However, the corporate offer can be a mixed bag, sometimes designed with the business’s goals in mind, rather than the charity beneficiary. Pro bono support is at its best when it is a catalyst for longer term change, focusing on skill building and helping the charity in question to make the case for investment in new skills. Schemes that structure their support in such a way as to negate capacity building or sustained impact in the charity beneficiary e.g. with a single day of one off support, are unlikely to have an impact. Corporate volunteering can also risk being inequitable: many businesses tend to be risk averse in their engagements. In practice, that can be a barrier for smaller charities, and presents the risk of entrenching patterns of unequal access to support. Volunteering that puts the charities’ needs first, and ensures broad access to support, is a boon to the sector, bringing in skills that would otherwise be off limits.

Setting the stage for collaboration

Charities can only get so far working in isolation, and many champion the value of building a shared picture of need, services and service gaps. But sharing their data, or more likely insights from their data, means having the incentives (financial and otherwise) and confidence to do so. At the moment, funding flows encourage competition, not collaboration. Some brave organisations have bucked this trend but many more will need better incentives to do so.

This is a moment of great opportunity for the sector: the barriers to entry for data collection, management and analysis have never been lower, with low or no-code tools making it possible to do more with fewer resources and skills. All sectors are forming their collective stance of what is and isn’t responsible use of data, and it’s time for the social sector to do so. But we need to support sector leaders to be data-confident, to learn from each other, and to collaborate. Funders hold the power to shape this opportunity for a more data-informed, effective sector.

This piece was written in response to the publication of the report ‘Unleashing the power of civil society’