76% of NFP staff report using generative AI tools for tasks like drafting emails, brainstorming, or even content creation, according to Infoxchange’s latest Digital Technology in the Not-for-Profit Sector Report. This is not surprising, as many NFPs face loads of written guidance during staff inductions, only to be forgotten or left untouched afterwards.

To demonstrate how AI can bridge this gap in the sector, design company Neon Carrot developed an AI-powered chatbot agent using documents from the Australian Government’s Aged Care Quality and Safety Commission. This resulted in a chatbot interface that lets aged care workers input queries and instantly receive contextually appropriate, easy-to-understand responses – complete with references to the original documents.

This approach could transform operations across other NFPs, too. By tapping into their existing knowledge bases – such as training materials, policy documents, and practice frameworks – organisations can build similar AI-powered chatbots. These tools would give staff quick, reliable access to the necessary information while ensuring data security and referencing internal documents only.

This is an example of AI’s practical uses that we can expect to see more: small and simple solutions tailored to fix specific problems. But there’s still a long way to go. While interest in AI is booming, only 3% of NFPs are now actively investing in it.

Despite not diving headfirst into AI, NFPs are frustrated with their systems. According to Infoxchange, 77% of NFPs don’t have systems giving them a full understanding of the impact of their services. Only one in four agree their data quality is good enough to support meaningful reporting and analysis. Yet 37% of NFPs now rank data and reporting for evidence-based decision-making as their top technology priority, more than twice last year’s figure.

AI promises a future of efficiency and impact, but organisations can’t tap into that potential without strong foundations. Data quality, system integration and reliable reporting tools are becoming non-negotiables. Advances in AI are the tipping point that pushes NFPs to take action – modernising systems, cleaning up data, and preparing for what’s next.

While the changes might take time, the appetite for transformation is growing, and this year sets the stage for a more tech-savvy sector.

Read also: Making Artificial Intelligence Work for You