If you lead a nonprofit right now, you do not need a survey to tell you that money is tight. But the numbers confirm what many organizations across Hawaii are feeling. According to the Center for Effective Philanthropy’s 2026 State of Nonprofits study, roughly one in three nonprofits has experienced a disruption in government funding, and more than half report that foundation dollars are getting harder to secure. Major individual gifts have become less predictable as well. The result is that more nonprofits are operating in the red than at any point in recent years, and many have responded the only way they can in the short term: by reducing staff.
That is the hard part of the story. The more hopeful part is what nonprofits are doing next.
Nonprofits are not cutting technology. They are leaning on it.
You might expect technology budgets to be the first thing on the chopping block. The opposite is happening. BDO’s most recent Nonprofit Standards benchmarking report found that 64 percent of nonprofits are increasing their technology spending in order to deliver their programs and services more effectively. Nearly half of nonprofit leaders say that using technology to improve operations and efficiency is a top priority.
The logic makes sense. When your team shrinks but your mission does not, the people who remain are carrying more. Technology is one of the few levers available to help a smaller team accomplish what a larger team used to. The organizations navigating this moment best are the ones treating technology as a force multiplier rather than an expense line.
A new idea worth watching: sharing operational functions
One of the more striking findings in the CEP study is that 30 percent of nonprofits are now considering sharing operational functions, including technology, with another organization. Only about 6 percent actually do this today, so it is an emerging idea rather than an established practice. But it points to something real. Back-office functions like IT, finance, and administration do not have to be built from scratch inside every organization, and for smaller nonprofits, they probably should not be.
This is essentially the problem that outsourced and co-managed IT was designed to solve. Rather than hiring dedicated IT staff, or asking your operations manager to be the accidental IT person on top of everything else, a nonprofit can share a full IT team, a security stack, and strategic planning capacity with other organizations through a managed services model. You get enterprise-grade capability at a fraction of the cost of building it yourself, which is exactly the kind of economics this funding environment demands.
The AI question, answered honestly
Nonprofits have been slower than businesses to adopt AI, and there are understandable reasons for that. Budgets are stretched, data privacy obligations are real, and nobody has spare time to evaluate tools. Even so, adoption is accelerating quickly. One industry survey found that AI use in the nonprofit sector jumped from 31 percent in 2024 to 48 percent in 2025, and about one in five nonprofit leaders is now looking at AI specifically as a way to reduce operational costs.
Here is the distinction we encourage our nonprofit clients to understand, because it changes the conversation entirely. There are really two kinds of AI in play right now.
The first is the chat-style AI most people already know, where a staff member types a question or pastes a document and gets help writing, summarizing, or brainstorming. This is useful, and it is probably already happening in your organization whether you have a policy about it or not.
The second is AI built into your actual business systems: your donor management platform, your finance tools, your case management software, and automated workflows that handle repetitive tasks without a human touching them. This is where the meaningful efficiency gains live, and it is where an organization that has lost staff can genuinely recover capacity. Getting there takes planning, clean data, and the right licensing and regulatory considerations, which is exactly the kind of roadmap conversation a technology partner should be leading with you.
The quiet risk: personal devices and personal AI accounts
There is one place where nonprofits need to be more careful than their commercial counterparts, not less. Many nonprofits rely heavily on volunteers and part-time staff, and those individuals often work from personal laptops and use the free, consumer versions of AI tools they use at home. That combination creates real exposure. Donor records, client health information, and financial data can end up on devices and in AI accounts your organization does not control, cannot secure, and cannot audit.
This matters for a second reason that catches organizations off guard: cyber insurance. Policies increasingly require specific security tools and practices as a condition of coverage. If the person filling out your insurance application does not fully understand your actual technology environment, your organization can end up providing inaccurate answers, and inaccurate answers give a carrier grounds to deny a claim when you need it most.
None of this means banning personal devices or forbidding AI. It means putting simple guardrails in place: business-grade accounts for AI tools, sensible policies for volunteers, and security that protects your data wherever it is accessed. These are solvable problems and solving them is far less expensive than a denied claim or a breach.
Where to start
If your organization is feeling the funding squeeze, the instinct to freeze all spending is understandable, but an unmanaged technology environment quietly costs more over time through inefficiency, duplicate tools, and risk. A better first step is a clear-eyed assessment: what you have, what it costs, what your team actually needs to deliver the mission, and where technology can give hours back to a staff that is stretched thin.
Intech Hawaii has supported Hawaii’s nonprofit community for years, and we understand that every dollar you spend on operations is a dollar you are accountable for to your funders and the people you serve. Whether you need to optimize your current setup, strengthen your security posture, ensure regulatory compliance, or explore how managed IT services could free up your team to focus on mission, we’re here to help you navigate this moment. Contact us today to schedule a conversation about what a right-sized technology roadmap looks like for your organization. No pressure, just practical guidance tailored to your reality.
