INSIGHTS INTO CRM FOR NONPROFITS

Transcription

1 INSIGHTS INTO CRM FOR NONPROFITS How nonprofits are approaching Constituent Relationship Management (CRM) to overcome challenges and meet their goals A report based on interviews with executives from 30 nonprofits, including: Alzheimer s Association National Office American Heart Association American Lung Association Children s Miracle Network Hospitals Church World Service Conservation International Doctors Without Borders Environmental Defense Fund Feeding America International Rescue Committee JDRF Jewish National Fund The Leukemia and Lymphoma Society Make A Wish America March of Dimes Mercy Corps Mothers Against Drunk Driving The National Multiple Sclerosis Society National Park Foundation National Urban League Oxfam America PETA Foundation Sierra Club Smile Train U.S. Olympic Committee WWF-Canada

2 TABLE OF CONTENTS Executive Summary...3 Introduction...4 What is your organization s definition of CRM?...5 CRM as a System... 6 CRM as Service... 7 CRM as a Strategy... 8 What prompted your organization s decision to pursue CRM?...10 The Dissatisfaction The Vision What challenges would CRM help you meet?...13 What goals would CRM help you achieve?...16 System-Related Goals Service-Related Goals Strategy-Related Goals Have changes in technology influenced your consideration of CRM?...19 What do you see as the greatest challenges in implementing CRM?...21 Perspective...21 Adoption Practical Who has been key in advocating CRM at your organization?...24 How are you getting started? / Where are you in the process regarding CRM?...25 Pre-Planning Planning Implementation Expansion What advice would you give to other nonprofits looking to move toward CRM?...28 Conclusion...30 NOTE: CLICKING LINKS ABOVE WILL JUMP DOWN IN REPORT. CLICKING PAGE #'S IN REPORT WILL COME BACK HERE

3 EXECUTIVE SUMMARY In the first half of 2012, Heller Consulting sought to find out more about how nonprofits are thinking about and approaching Constituent Relationship Management (CRM). Over the course of several months, we interviewed executives from 30 organizations to uncover their thoughts on their strategic, operational and technical goals, activities, and challenges within the context of CRM. Here are some of our top findings from our conversations: 1. Nonprofits definitions of CRM vary significantly. Participants view CRM as everything from a database and related processes to a focused approach on delivering constituent service or a proactive strategy to engaging with constituents. 2. Many organizations have to devote substantial time and resources just to keep their existing technology systems going. This leaves them less time to engage with constituents, provide top-notch service and consider CRM more strategically. 3. Participants existing technology systems aren t supporting their new strategies. Nonprofits typically are pursuing some form of CRM due to dissatisfaction with their current systems as well as the desire to implement new strategies. 4. Disparate systems and scattered data are top challenges with large nonprofits. Organizations are facing significant challenges with fragmented (versus consolidated) technology, information, processes and strategies. 5. Nonprofits believe CRM will allow analysis of, and support improvement in, strategic areas. They expect CRM to help them improve their fundraising, deepen constituent engagement, and have greater ability to deliver their programs more broadly. 6. Almost all nonprofits point to changes in technology as enabling their organizations to move toward some form of CRM. They agree that today s technology offers better solutions, often at lower prices, than in the past. They most frequently mentioned integration, business intelligence tools, web-based point solutions, and the Cloud as part of this discussion. 7. Organizations view people as one of the greatest challenges in implementing CRM. They anticipate everything from unrealistic expectations of CRM to poor data confidence as people challenges that might impede their CRM initiatives from moving forward. 8. Nonprofits universally agree that executive management and the board must provide leadership of a CRM initiative. Executives and the board provide vision, consistent communication, appropriate resources, and the stability to help ensure success of a CRM initiative. 9. Most participants are in some stage of planning for a CRM system. About one-third of participants have moved forward with some aspect of CRM implementation. 3

4 INTRODUCTION This isn t a typical paper about Constituent Relationship Management (CRM). It doesn t report results of a scientific survey with a statistically valid sample of participants. It doesn t include figures or pie charts. It doesn t make technology recommendations. It does help to describe the state of CRM in large, complex (sometimes called enterprise ) nonprofits, providing you with qualitative insights into what challenges these organizations are facing and how the organizations are considering and using CRM strategies and systems to meet their needs. Here s how the report came to be: In the first half of 2012, we decided to find out more about how nonprofits are thinking about and approaching CRM. Over the course of several months, we interviewed executives from 30 enterprise organizations to uncover their thoughts on their strategic, operational and technical goals, activities, and challenges within the context of CRM. Executives titles included Chief Information Officer, Chief Marketing Officer, Chief Operations Officer, Chief Philanthropy Officer, Chief Strategy Officer, Vice President of Fundraising, Director of Communications, Director of Development and Operations, Director of Systems Management, Director of Technology, and Donor Database Manager. While the organizations we spoke with represent some of the larger nonprofits in North America, many of the issues that we discussed apply to any nonprofit thinking about how to approach CRM to overcome challenges and meet their goals. HERE ARE THE QUESTIONS WE ASKED: 1. What is your organization s definition of CRM? 2. What prompted your organization s decision to pursue CRM? 3. What challenges would CRM help you meet? 4. What goals would CRM help you achieve? 5. Have changes in technology influenced your consideration of CRM? 6. What do you see as the greatest challenges in implementing CRM? 7. Who has been key in advocating CRM at your organization? 8. How are you getting started? / Where are you in the process regarding CRM? 9. What advice would you give to other nonprofits looking to move toward CRM? We intentionally asked our questions in an open-ended manner so as not to steer answers in any particular direction or box participants into a multiple choice answer. In this report, we share participants insights based on our discussions around these questions. We also offer our own perspective throughout the paper based on the interviews and on our own experience from working with more than 800 nonprofits over the past 15 years. We hope this report will give you valuable insights into how your nonprofit compares with others and how nonprofits are approaching CRM to tackle challenges and reach their goals. 4

5 WHAT IS YOUR ORGANIZATION S DEFINITION OF CRM? We started with a definition of CRM to put answers to our other questions in context. This proved to be the most challenging question, with the widest range of responses. While participants did not necessarily use the following terms, we find that most of their answers fall into one of the following categories, each with increasing sophistication and complexity: CRM AS A SYSTEM A database and related business processes CRM AS A SERVICE A focus on constituent service and managing relationships CRM AS A STRATEGY A strategy for cultivating, engaging with and expanding constituent communities Each definition assumes the former: Participants who talk about CRM as a service invariably note that a database system and business processes are required. Likewise, those (fewer) who define CRM as an organizational strategy also talk about systems and service. Those who primarily define CRM as a system sometimes talk about service, but none ties it to a broader constituent strategy. Since most organizations view of CRM falls into one of these three categories, you ll find that we reference the categories throughout this report. Let s take a closer look at participants viewpoints in each of the three areas in the next few pages. 5

6 CRM AS A SYSTEM About half of participants define CRM as a system. From this perspective, CRM is a robust database that can store and report on a wide variety of information and support business practices for inputting, maintaining and retrieving that data. The nature of the data stored and the types of reports available vary by organization. However, a primary characteristic of this definition is a focus on CRM as a system to facilitate work by nonprofit staff members within the organization. ABOUT HALF OF PARTICIPANTS DEFINE CRM AS A SYSTEM. For the majority of these organizations, the focus is primarily on fundraising. Non-fundraising data is useful mostly as it supports deepening relationships in the fundraising process in major donor cultivation, grant seeking, or broader marketing segmentation. These organizations desire a full view of their prospects and donors, with data from various areas centralized in a single record. Over half of the organizations with this view of CRM are struggling with their current systems to achieve their goals, with most either actively searching for new solutions or expecting to in the near future. There s a bit of a cycle in these organizations: The day-to-day effort required to keep their current systems functioning detracts from the time required to plan for and move toward something new. Likewise, the shortcomings of their current systems do little to inspire confidence, or investment, in new systems. Resources are instead devoted to acquiring point solutions that are needed to fill specific technology gaps. It then falls to staff members to make those solutions work as well as possible with their existing systems, which are getting older and less effective all the time. OUR PERSPECTIVE Many organizations with this view focus disproportionate resources on keeping their existing systems going. They end up with less time for engaging with constituents, providing top-notch service and considering CRM more strategically. Organizations making the greatest headway have recognized this and are carving out time to prioritize their CRM goals. Some are conducting indepth analyses and overhauls to their current systems, while more such organizations are moving toward switching systems entirely. In either case, it has become an organizational priority, and staff time and financial resources are being budgeted to make a concerted effort. 6

7 CRM AS A SERVICE About one-third of participants define CRM in terms of constituent service. This definition s primary characteristic is its focus on CRM as serving constituent needs and enhancing the experience of constituents who communicate with the organization. Like the system definition, it includes a database and business processes. However, these are oriented ABOUT ONE-THIRD OF PARTICIPANTS DEFINE CRM IN TERMS OF CONSTITUENT SERVICE. around providing a superior service experience to constituents. What data is stored in the system, which departments and people use the system, and how business practices are carried out are all considered from the perspective of What will best enhance the experience of constituents who contact us? For the most part, the definition of constituents is broader, too, including fundraising prospects and donors as well as advocates, volunteers, event participants, partners in program delivery and direct beneficiaries of the organization s mission. Organizations employing this definition strive to develop a sense of intimacy with their constituents, an especially ambitious goal for organizations with hundreds of thousands or even millions of constituents. Because of the volume of constituents and the attendant amount of data and number of ways one can connect with the organization a robust CRM database is all the more important. These organizations tend to have more advanced business practices in place as well, including data management and fundraising, as well as customer service personnel and inquiry mechanisms, both online and traditional. For a few of these organizations, superior service is part of how they deliver on their mission. Their mission itself centers on disseminating information (e.g., research, educational and advocacy organizations). Organizations with this view are focused on service-oriented capabilities, such as fielding constituent calls and online inquiries, and implementing publicly accessible knowledge-base and FAQ systems. OUR PERSPECTIVE Organizations with this view may not be moving quickly, but they re progressing. For the most part, they ve allocated staff and financial resources to support their CRM goals, and have day-to-day operations sufficiently managed to allow time to move forward on these initiatives. Though broad database system changes are often difficult undertakings, in this circumstance it s occurring with the shared goal of better service to constituents. While this may not mitigate technical challenges, it can help with people and political challenges, which tend to be the greater challenges. 7

8 CRM AS A STRATEGY Several of the participants (about a half-dozen) view CRM as an organization-wide strategy that touches every aspect of how they operate. Like the service definition, the constituent experience is at the heart of each department and person s goals and tactics, but it goes further to pro-actively reaching out to constituents and creating positive, pertinent experiences for them. Although they don t abandon traditional methods of nonprofit communication, these organizations also follow the lead of their constituents. For example, many are pro-actively engaging with their constituents via social media. WE RE NOT WAITING FOR THE NEW SYSTEM BEFORE WE TAKE ACTION. For organizations with this view of CRM, a sea change is usually in process. Operational structure from responsibilities, workflow and processes to database systems and access are geared toward providing the optimal constituent experience. Traditional nonprofit practices may be re-configured, breaking down barriers between departments, roles and people. The demarcation between what is inside and what is outside the organization is re-examined. Constituents, whether traditional members or not, are considered and treated as part of the organization. SEVERAL OF THE PARTICIPANTS (ABOUT A HALF-DOZEN) VIEW CRM AS AN ORGANIZATION-WIDE STRATEGY THAT TOUCHES EVERY ASPECT OF HOW THEY OPERATE. Organizations with this view often aim to be at the forefront among their peers, although that isn t the driving factor. It is, however, an indicator to them of their success in providing a positive constituent experience. They strive to be pro-active with their constituents and will take risks in their tactics. They are willing to accept a degree of failure in their initiatives, feeling that enough of their efforts will yield sufficient results. Most of the organizations with this view have already moved forward with their vision, though they are at various stages of realizing it. As this group is smaller in number and already forging their own paths, making specific statements about how they as a group are implementing CRM is difficult. Most have cleared the first and most significant hurdle articulating and selling the vision within their organization. Implementation of new databases, processes and roles is at various stages. They are juggling their inherited forms of constituent engagement while building new ones. But, in the words of one participant, we re not waiting for the new system before we take action. 8

9 OUR PERSPECTIVE These organizations are catalyzed by their CRM vision. They are moving fast and with clarity. Their operations may be inefficient in some areas, but they are still driving toward near-term goals and a longer-term vision. While they face some of the same operational challenges as other nonprofits, they perceive them as part of the change they are going through or the past they are leaving behind. Organizations on this path have gone to the root of their organization their mission and define their version of the constituent experience as the heart of what they offer. With this as their starting point, they ve re-examined each department and role, goal and tactic, to bring them into alignment with this vision. It requires patience, commitment, open communication, and leadership by executive staff and the support of the board. OUR DEFINITION OF CRM From our perspective, nonprofit CRM begins with a strategy. The starting point is a focus on the constituent: How can we best serve them? This is an exciting point! This is how every nonprofit starts with the vision, aspiration and drive to best serve its constituents. The goal of a nonprofit s CRM strategy is to find, attract, and win new constituents, nurture and retain those the organization already has, entice former constituents back into the fold, and reduce the costs (and/or increase the efficiency and efficacy) of communications and providing service to constituents. It then enlists technology, business practices and customer service to support and enhance the constituent experience and, in turn, the mission of the organization. 9

10 WHAT PROMPTED YOUR ORGANIZATION S DECISION TO PURSUE CRM? We wanted to know what made participants pursue CRM in the first place. And, they had answers, noting two primary factors prompting them to move toward their own particular view of CRM: 1. Dissatisfaction with their current donor database and related systems 2. The desire to implement new strategies Often the two are tied together: Participants existing donor databases and other related systems (such as , registration, volunteer management, applications and program management tools) can t support their new strategies. THE DISSATISFACTION Dissatisfaction ranges from mild irritation (e.g., It s difficult to get good reports quickly) to outright pain (e.g., The information they need to guide their nonprofit is onerous to produce and untrustworthy when they do manage to produce it.) Their existing systems primary failures to meet their needs fall into the following categories: 1. SILOS Many of their systems are point solutions developed or adopted to fill specific gaps, and lack the flexibility to adapt to contemporary needs, such as integration with other systems, online communications, the Internet, and now social media. This has resulted in disconnected systems, each of limited value to the organization overall and lacking useful cohesion between them. 2. CONSTITUENT SERVICE Because of disparate systems or simply limited functionality in any individual system, nonprofits can t meet their constituent service goals in providing timely, accurate information to their donors, partners and beneficiaries. 3. SEGMENTING It can be difficult or impossible to honor constituents communication preferences regarding the type of information they d like to receive, frequency of communications, and communication channels they prefer. Also impacted: the organization s ability to carry out their own targeted communications and/or track results. 4. STEWARDSHIP For high-touch relationships, organizations have limited ability to track important information over time and provide a full picture of relationships with key constituents. The issue is compounded with staff turnover: Transferring a relationship to someone new reveals holes in the information and can cause the relationship to falter. 5. SUPPORT For some, meeting even their baseline needs requires a tremendous amount of internal effort to coerce systems. Some have devoted substantial staff resources to developing and supporting in-house systems, becoming de-facto software developers. When these in-house systems no longer meet the organization s needs properly, the ongoing costs to the organization are even more apparent. 10

11 THE VISION At the same time, most nonprofits are pursuing CRM so they can successfully carry out their strategies. For some, it s a matter of expanding what has always worked for them and, consequently, scaling their strategies beyond the capacity of their current systems. For others, it s about adapting or even transforming their organization in response to the evolution of their mission, constituents and environments. These organizations note the following priorities as they think about CRM: 1. STRATEGIC ALIGNMENT CRM must directly relate to and support the current and emerging strategic goals of the organization. This is far easier said than done. In fact, moving toward CRM is often prompting organizations to ask fundamental questions: Who are the stakeholders our mission is serving? How can we best relate to them? How do we measure our success? What information, business processes and engagement practices will drive our success? 2. CONSTITUENT SERVICE Here, CRM is used to support timely, accurate and transparent constituent service. Transparency means lowering barriers between the nonprofit and its constituents to engage more closely and promote affinity for the organization. In high-touch relationships, it includes knowing constituents well enough to provide highly personalized experiences. For broader audiences, it means providing options for constituents to engage with the nonprofit, including how, when and why the nonprofit engages with them. 3. SCALABILITY Achieving strategic alignment and constituent service goals requires substantial data and sophisticated processes. CRM has to support these requirements without overwhelming the nonprofit. This is particularly important when an organization considers the future. None of the participants knows which CRM approach will be most fruitful, but they know that capitalizing on opportunities can t require the struggle they currently experience. This has prompted some organizations to think about their CRM technology decision as less about selecting a single software solution and more about choosing a platform that can be built upon to meet their current needs as well as those that emerge in the future. 4. STAYING CURRENT, OR EVEN AHEAD The nonprofits that have already started down the CRM path express a willingness to experiment, a desire to stretch to meet their more forwardbehaving constituents, and a collegial, competitive spirit regarding other nonprofits. They re at the forefront and, for the most part, find value in being there with the risk of occasional stumbles outweighing the risk of being late to the game. 11

12 OUR PERSPECTIVE: CRM, WHY NOW? We started hearing about nonprofit CRM around Better technology had started to become available: improved ways of integrating data between systems, better reporting and business intelligence tools, and systems that could start us down the CRM path. And then the economic downturn of Organizations put their CRM plans and projects on hold. Now CRM is back on their radar, and it s needed more than ever. During the downturn, the sector embraced and committed to online communication to an unprecedented degree. We ve also seen the rise of social media and all manner of Software-as-a-Service solutions for communication, fundraising and mission management. All of this has created more data silos and generated even more constituent data. In a nutshell, here s how we see it: 1. The bad news: Organizations have many technology systems that barely talk to each other and have aged poorly over the years. 2. The good news: Many organizations now have more time, resources and support to make things better. 3. The great news: Technology has made substantive improvements. Organizations can get further down the CRM path, faster. 12

13 WHAT CHALLENGES WOULD CRM HELP YOU MEET? Everything s in different silos. This is the over-riding challenge for participants. They are facing significant challenges with fragmented (versus consolidated) information, processes, people and strategies. Participants see moving toward CRM as the primary way they can address these challenges, particularly because many of those challenges are interrelated and overlapping. The areas of fragmentation that they cite include: 1. DATA Constituent information is scattered across the organization. This is especially problematic when individual constituents engage with the nonprofit in multiple ways. Disparate data is difficult to keep synchronized: Sometimes no effort is made at all or, more often, it s not even recognized across the organization that individuals data is in multiple places. Plus, differing practices for input and upkeep of information, and differing definitions of types of data (e.g., Does prefers mean send only or ok to send direct mail content that isn t available via ?) can create confusion and a lack of trust in the information. 2. PEOPLE AND DEPARTMENTS At many nonprofits, each department is only peripherally aware of the strategies, goals and activities of other departments, even when they are engaging with the same constituents. The constituent s experience usually is not positive: He or she perceives that the left hand doesn t know what the right hand is doing. Another common disconnect happens at the management level when executives don t or can t avail themselves of the information they need. It may be that the information isn t available, too much effort is required to produce it, reports or dashboards aren t user friendly, or all of the above. DISPARATE SYSTEMS AND SCATTERED DATA When participants talk about data silos they are usually referring to the use of multiple database systems at their organization. Many have experienced an incremental proliferation of such systems over multiple years. Now each system has become seemingly intractable crucial to some group of people, strategy, process or data set. Viewed in isolation, any particular system may be solving the problem it was intended to address. But from a CRM perspective, it often contributes to the problem of data scattered across the organization. Evolving communication channels between nonprofits and their constituents has also contributed its own type of fragmentation. Each channel (direct mail, telephone, online, social, etc.) may require its own system that creates its specific dataset. Sometimes the channel is viewed as a stand-alone strategy (e.g., our social strategy ). Sometimes a single channel, such as mass ing, serves multiple strategies, but the channel s system isn t integrated with other channels. 13

14 3. PROCESSES Fragmented processes require nonprofit staff members to work in and across multiple systems in the course of their day-to-day activities. The resulting workflow is inefficient, difficult to repeat consistently, and requires checking and re-checking information at each step. Additionally, at any one organization there are often multiple ways to do the same thing (e.g., send an invitation), with the process varying depending on which system a staff person uses. This requires users to understand multiple systems, to choose the appropriate system for their task at hand, and to verify that the results match their expectations. It also requires other personnel usually the IT department to provide training and support for multiple systems that facilitate the same business practice. 4. CONSTITUENT RELATIONSHIPS All of this leads to the primary challenge fragmented constituent relationships. Participants note key challenges in both mass communications and one-on-one relationships. For mass communications, proper segmentation is almost impossible due to scattered data. In one-on-one relationships especially major gifts, corporate, foundation and partner management the absence of CRM makes it difficult to: 1. Communicate the impact constituents are having on the nonprofit s mission 2. Internally transition responsibility for high-touch relationships within the organization 3. Maintain the desired depth of relationship with high-value constituents over the long haul Most participants believe CRM will help with their biggest challenges: DATA DATA Fragmented (versus consolidated) data, process, people and strategies that lead to fragmented relationships with their constituents. DATA DATA DATA DATA DATA Constituent DATA Nonprofit Organization 14

15 OUR PERSPECTIVE: CRM AND SOCIAL MEDIA For more than three-quarters of participants, engaging their constituents via social media is front-and-center in their minds. There s broad consensus that it has value beyond securing potential donors although that value is not always clearly definable. We don t know what the big payoff will be, but we are moving away from with the next generation and engaging them via social media, says one participant. From our perspective, it s critical that nonprofits discover how to effectively engage with their next generation of constituents through new media channels. At the same time, it can create yet another silo, further burdening nonprofit staff and causing organizations to miss opportunities to build relationships with their constituents. Nonprofits that address this head-on by using CRM as a means to consolidate and analyze information, and carry out resulting strategies, will be stronger and more responsive to constituents. They ll build deeper and broader connections with their constituents and emerge as leaders in their fields. EXAMPLES OF SOCIAL MEDIA CHANNELS: Blogger Facebook Flickr Google + Instagram LinkedIn Pinterest Tumblr Twitter Vimeo WordPress YouTube 15

16 WHAT GOALS WOULD CRM HELP YOU ACHIEVE? While the challenges participants face are many and varied, many of their goals are similar. Some goals are in response to the pain and difficulty of working with their current systems, while some are inspired by a vision for their organization and constituents. Most are a combination of the two, and align with the CRM definition areas of system, service and strategy: SYSTEM-RELATED GOALS Merging all information into a single record and achieving a complete view of each constituent is a highlighted goal for most nonprofits. The perceived value of that single record / 360 view varies, but it is discussed in some way by most participants. Also important is reducing the number of databases where information is stored, and therefore the variety of systems that needs to be referenced when trying to understand constituents either individually or in groups. Consolidating data and databases is also viewed as supporting increased efficiency in business processes. Minimizing the number of systems one must master, and bringing consistency to using the remaining system(s), is high on most organizations lists. This will allow organizations to better align responsibilities and roles in a logical way, support consistent and automated workflow and data cleansing practices, and encourage communication within the organization. All of this helps address the crucial issue of understanding, and having confidence in, the data. Finally, fewer systems to support puts less of a burden on IT departments, which may turn their time and attention from putting out fires, to pro-actively implementing technologies that support strategies. SERVICE-RELATED GOALS Consolidated, reliable systems, say many participants, will enable them to respond to constituent inquiries faster and with greater accuracy and thoroughness. The several organizations that have already achieved this say that many questions are now addressed at the front lines, with a significant decline in issues requiring management involvement. Not much is escalated to me, freeing me up to focus on other things, one participant says. Systems and processes can even help staff members address items before they become issues, thanks to checks and balances introduced as part of CRM. These benefits not only accrue with prospects and donors, but also extend to internal colleagues, external partners and project collaborators, FOR US, TRANSPARENCY clients, and beneficiaries of the nonprofit s mission. CRM is frequently seen as supporting transparency. For us, transparency means showing people outside and inside the organization a full view of what we are doing, what s working, and what s not, says one participant. Some nonprofits anticipate this will increase connection with, trust in, and loyalty to the organization, and engage their various constituents including internal staff in a constructive dialogue about how to achieve the organization s goals. MEANS SHOWING PEOPLE OUTSIDE AND INSIDE THE ORGANIZATION A FULL VIEW OF WHAT WE ARE DOING, WHAT S WORKING, AND WHAT S NOT, 16

17 STRATEGY-RELATED GOALS Nonprofits repeatedly say that CRM will allow them to make better decisions based on better, cleaner, more complete data, and then act on those decisions more quickly and effectively. Practically, most participants point to better reporting as a key benefit of CRM. This reporting is based on better data, is reliable and repeatable, requires minimal manipulation, and can be generated or accessed by decision-makers when they need it. Participants believe that CRM will allow analysis of, and support improvement in, these primary strategic areas: 1. FUNDRAISING Almost all participants note improved fundraising as an expected benefit of CRM. Improvements will be driven by consolidated and better-quality constituent information, clearer and more consistent business practices, and deeper insight into the return on investment for each approach, channel and constituency. We ll be able to raise more money using the strategies that are most effective for us, and use less administrative time doing it. 2. COMMUNITY ENGAGEMENT Most participants also are communicating with constituents for reasons other than fundraising, although those reasons are varied. This engagement is happening via the Internet in public or proprietary forums or social sites, and an organization s participation usually started as an experiment. It s now on the cusp of becoming a full strategy for many organizations. While these strategies may involve fundraising cultivation, more often they are focused on brand building and sometimes as an opportunity to deliver on their mission in new ways, reaching a broader audience. 3. ORGANIZATIONAL IMPACT Many organizations want information about the relationship between funding, activity and outcomes with less effort than it currently takes, and they want to share it with internal and external stakeholders. Providing this information can support fundraising with individual donors and institutional grant makers, and allow organizations to hone the focus of their external partnerships and internal efforts in delivering their mission. CRM will highlight which of their programs have the greatest relative impact, and which of their tactics are most effective. WE LL BE ABLE TO RAISE MORE MONEY USING THE STRATEGIES THAT ARE MOST EFFECTIVE FOR US, AND USE LESS ADMINISTRATIVE TIME DOING IT. 17

18 4. FOCUSING AND ENABLING RESOURCES Ideally, CRM will help each person and department focus where they can have the most impact and support them to work cohesively in service of the mission. Armed with fundraising, engagement and impact analyses, nonprofits can see what has been successful, where we should focus, and have a tool to carry out the how of our strategies. OUR PERSPECTIVE: CRM, MASS COMMUNICATIONS AND MAJOR DONOR MANAGEMENT Many participants note two CRM goals in the realm of fundraising better list segmentation and improved major gifts management. The way we see it, abundance of information about constituents, combined with improved tools, will better enable fundraisers to strategically segment large prospect and donor files. This supports more effective mass communications and fundraising, particularly as organizations further adopt multi-channel strategies and increase their efforts to follow constituent preferences regarding interests and communication channels. We think that one area in which nonprofits can experience significant and rapid gains is with major donor management. A more complete view of information about a constituent will allow major gift officers to more easily deepen and pro-actively develop relationships. Improved integrations with wealth screening, data append and predictive analysis services provide even deeper insights. Using a CRM system, nonprofits can assign prospects to major gift officers more quickly and with greater assurance that they are good candidates for cultivation. And, contemporary CRM systems better support how major gift officers naturally work by including native remote and mobile access, as well as workflow that supports moving prospects further along the relationship path with the organization, with less manual effort. Finally, such CRM systems offer improved prospect, activity, and pipeline reporting so that the organization will know how staff members are engaged, what tactics and strategies are most effective, and when the resulting gifts will be made. 18

19 HAVE CHANGES IN TECHNOLOGY INFLUENCED YOUR CONSIDERATION OF CRM? Almost all participants point to changes in technology over the last several years as enabling their organizations to move in some way toward CRM. There is general consensus that technology now offers better solutions to nonprofits, often at lower prices, than in the past. The cost of moving to these solutions is now lower than the cost of staying on failing systems (in dollars and, more frequently, in missed opportunities). The most frequently mentioned topics include integration, business intelligence tools, Internetbased point solutions and the Cloud : Participants see that integration between systems has substantially improved. Until now, IT teams would cobble together systems and offer reports or presentation layers for end-users, but issues with integration often would negatively impact the endeavor. Contemporary CRM systems have been developed with integration in mind, especially if they are web-based or were built to work with web-based systems. While not foolproof, they can be relied on to a greater degree than older client-server systems and clunky APIs. Nonprofits also see that Business Intelligence (BI) tools have improved more efficiently accessing data from multiple sources and providing more robust reporting. Their preferred systems architecture includes primary reliance on BI tools for complex analysis of CRM data, with simpler reporting generated from a CRM system s native features. Data warehouses are of interest only in those cases where a CRM/BI combination isn t effective. The necessity to move data into a warehouse is seen as a potentially unnecessary step if a strong BI tool can be implemented. For many nonprofits, web-based point solutions are a double-edged sword relative to CRM. On one hand, They allow faster, more appropriate response to constituents as they change behavior or as preferences evolve, says one participant. On the other hand, they are another silo, contributing to data fragmentation. Better integration options are being built into some of these solutions, but that still requires a project to capitalize on those options. For most organizations, the Cloud strongly factors into their CRM thinking and planning. The term often sparks a lively debate about what the Cloud is or isn t; if it s old or new, technology or marketing. A few say It s not about the Cloud; functionality comes first. But overall, participants point to the Cloud as key to the future of their CRM system choices: 1. For many nonprofits, the anywhere, anytime access offered by Cloud systems is crucial. It is seen as a way to increase productivity, accuracy and effectiveness. This becomes increasingly important with staff members who may work in the field to deliver on the organization s mission. Such access allows them to capture information more quickly, increasing the accuracy of the information and the likelihood it will be captured in the first place. Many participants said if someone has to wait until they get back to a desk, they aren t going to input it. IF SOMEONE HAS TO WAIT UNTIL THEY GET BACK TO A DESK, THEY AREN T GOING TO INPUT IT. 19

20 2. The capacity for Cloud-based systems to be customized, developed, integrated and scaled is a key benefit. The existence of applications in which companies are building solutions that are open and can be connected to a nonprofit s CRM system vastly increases the Cloud s value to nonprofits. 3. The Cloud addresses some fundamental infrastructure issues. Performance, data backups and upgrades are managed by the software vendor, freeing an organization s IT resources for other projects. Participants note that one must investigate a vendor s data security and privacy practices, and the true total cost of their solutions (including licenses, data storage, and API calls for integration), but that as long as one goes in with eyes wide open, Cloud solutions compare favorably with traditional options. 20

21 WHAT DO YOU SEE AS THE GREATEST CHALLENGES IN IMPLEMENTING CRM? We all want a solution to this [CRM] problem. The challenge is that you ve got technology on one end and people on the other. If we could just get the people out of the way No other question draws the consensus this one does: People are the greatest challenge. Not every organization actually experiences the following challenges. However, even the anticipation of these challenges deters some of them from moving forward: 1. UNREALISTIC EXPECTATIONS about what CRM means, what it will take for the organization to get there, and how much each person will be asked to contribute 2. TESTING AND TRAINING From wanting more to ignoring what s offered oftentimes both at the same organization 3. DOCUMENTATION AND SUPPORT Documentation is considered insufficient, it s ignored, or no one owns it so it soon goes stale 4. DATA CONFIDENCE starts high and collapses on a few minor points that are easily fixed, or starts low and stays low even though the data has been cleansed and updated, but because the system is new it doesn t look familiar WE ALL WANT A SOLUTION TO THIS [CRM] PROBLEM. THE CHALLENGE IS THAT YOU VE GOT TECHNOLOGY ON ONE END AND PEOPLE ON THE OTHER. IF WE COULD JUST GET THE PEOPLE OUT OF THE WAY 5. PROCESSES that everyone agrees are crucial, but no one wants to follow 6. WANTING TO SEE INFORMATION others have, but not trusting them enough to share one s own Participants also cite other potential and real challenges, which fall into three primary categories: perspective, adoption and the practical. They offer their thoughts on how to overcome these challenges: PERSPECTIVE Participants say that helping people shift their perspective is a challenge along several lines. CRM requires people to stretch beyond what they do and know. A vision for CRM is crucial so individuals understand its value to the organization beyond their particular domain. They also need to understand how their domain connects to that vision particularly when they are asked to change and grow in adopting a CRM system. 21

22 Who owns a constituent record is a consistent concern. Although we are a single organization, people don t act that way with their data, says one participant. Because different people and departments have different goals with their constituents, they may be reticent to share constituent information. However, when constituents are treated in a fragmented fashion, they bear the brunt of this practice and it can actually work against the organization. People become attached to their systems and processes. In fact, people may complain about a system in one sentence, and express strong reservations about leaving it in the next. ADOPTION The promise of CRM relies on everyone using it. When people commit to using a CRM system, its value increases, and commitments broaden and deepen. When people neglect a CRM system, its value decreases, usage drops lower, and eventually it s considered a partial, or complete, failure. Based on successes, failures, and conventional best practices, participants note the following as key areas of focus to promote successful user adoption within an organization: 1. VISIONING, PLANNING AND CRM SELECTION From the early stages, key stakeholders need to be engaged in the process. Although a CRM initiative may begin with a specific group in the organization, for it to succeed, it will ideally include representatives from all groups. Creating the vision for a CRM system, selecting the system, and implementing the system should be group efforts. This approach helps get everyone on the same page about where the organization is headed with their CRM system and how they will get there. 2. DATA CONVERSION AND PROCESS DESIGN Trust in data is a key factor in CRM adoption, particularly when one s own data is consolidated with other people s data, and the entire set of information may be cleansed, upgraded, and viewed in a new format and system. This trust is not something to be won once and forgotten: It s renewed (or lost) based on the processes established to keep information accurate, current and valuable. 3. TRAINING AND TESTING There s no such thing as too much training, says one participant. Ideally, training starts early in moving to a CRM system, and continues consistently through implementation and adoption. This is important because change does not come easily and is best instituted gradually. 4. SUPPORT Ongoing support of a CRM system, ideally by a CRM administrator, is cited as a crucial item that must be planned for from the beginning. Ideally, this person (or team) is integrally involved in the implementation, so they know the CRM system, the strategies, and the people it supports. In the weeks and months immediately following CRM system go-live, the focus is on staff questions and immediate needs. Over time, support expands to include pro-active engagement with staff and their needs, including hosting user groups, learning about emerging strategies, implementing new features to meet new needs, and managing the CRM road map. 22

23 PRACTICAL Participants consistently highlight data as the primary technical or non-people challenge. While good data doesn t guarantee success, bad data is seen as dooming CRM from the start. Participants say trust in the data must be maintained through sound business practices. It takes a single day to mess up good data, says one participant. CRM requires sophisticated business practices for most nonprofits because it supports many users, departments and business needs sometimes even many locations, time zones, cultures, currencies and languages. Existing and new processes must be developed and tested thoroughly. While a substantial undertaking, participants also view it as an opportunity to address current inefficiencies tied to legacy systems and mind-sets. From an adoption perspective, it is important to engage staff members in identifying current inefficiencies and opportunities for improvement. The testing process involves them in validating and influencing new practices. This approach, while more time- and staff-intensive, is more likely to result in better practices that are more quickly and broadly adopted. Documentation is considered crucial. Whether reflected within a CRM system s contextual help functions or recorded in Microsoft Word, written documentation supports consistency in critical processes, accommodates individual usage anomalies at an organization, and ideally explains not only how to do something, but also why the nonprofit has chosen that process. OUR PERSPECTIVE: MANAGING CHANGE Change is difficult. We don t like the unknown, and technology is often particularly opaque. To succeed, CRM system implementation and adoption requires communication and lots of it. Our top tips for managing change: 1. Give people an opportunity to voice their concerns and their ideas. Listen to what they say. You may find the solution to thorny problems and your strongest CRM advocates through such conversations. 2. Put communication at the center of the project. Send regularly scheduled updates to all stakeholders, even if their participation in the project or connection to the CRM system won t happen for a while. Focus on sharing wins, admitting setbacks (and sharing plans to overcome them), and balancing excitement and expectations. 3. Show stakeholders the system early and often. The more they see the system, the more comfortable they will become with it. 23

24 WHO HAS BEEN KEY IN ADVOCATING CRM AT YOUR ORGANIZATION? Participants are clear and in agreement on the answer to this question: Executive management and even the board must provide leadership of the CRM initiative. The idea and effort can start elsewhere in the organization, but to be successful, executive management must pro-actively support CRM, providing vision and prioritizing resources. And, because a CRM system often represents a significant investment of dollars and staff time, and can involve strategic changes, board support and leadership can also be critical. According to participants, executive leadership is important for the following reasons: 1. VISION It s common that others in the organization develop the CRM vision. The role of executives, however, is to hold and convey that vision through the course of the project. 2. MESSAGING Successful CRM requires consistent and repeated messaging regarding its value to the organization and its relationship to key strategies. Executives can ensure that staff members regularly hear about their role in the success of the CRM strategy, how and why they re being asked to contribute, and how CRM will support their goals. OUR PERSPECTIVE: GETTING EXECS AND THE BOARD ON BOARD Here are our tips for generating excitement and commitment from executive management and the board: Lead with strategy. Talk about the big picture first, and then about how a CRM system will enable that vision. Secure a champion. Find an advocate among your executives or board members. They may have valuable experience with CRM systems and can support a CRM system implementation at your nonprofit. Demo well. Early in the process, show aspects of a CRM system that will particularly appeal to executive and board priorities. Dashboards that provide useful information at a glance and improved tools for cultivating highvalue donors are usually good choices. 3. RESOURCES Successful CRM requires significant investment of staff time and financial resources. Executive leadership can make these resources available and, when necessary, prioritize competing interests. 4. STABILITY Implementing CRM comes with bumps in the road. There will be times when those in the trenches will ask Why are we doing this? In those moments, executives can remind staff members of the vision, allocate additional resources, and provide encouragement. 24