Jay Love is a guest contributor for Nonprofit Hub. He’s currently the CEO and Co-Founder of Bloomerang and the Senior Vice President of Avectra—both organizations serving the nonprofit sector with cutting edge technology tools for fundraising and communications.
The beginning of each year is such a time of renewal for nearly everyone. From personal resolutions to annual organizational objectives, we all seem to embark upon new horizons. Internal systems utilized by non-profit organizations for performing communications and recordkeeping often make such lists. Far too often, the process of finding new horizons is riddled with long standing myths or assumptions, which literally block the path to real success. Let’s see if we can alleviate many of the more common myths in this area.
Industry Research on Non-Profit Database Selection Timing
Research tells us that somewhere around 15% of the registered non-profit organizations will be researching then deciding upon a new fundraising software system for their important task of managing prospective and future donors in any given year. Such data and what is performed daily with it is truly the lifeblood of nearly 80% of all charities. This is true whether you are a fledgling 501(c)3 with less than a million in annual revenue or one of the sector titans with more than 100 million in annual revenue.
Sophisticated Fundraising Software Capabilities Available to All
I became involved with helping NPOs select fundraising/CRM systems in 1983. Therefore, this new year of 2013 is exciting because it will mark 30 years of consulting with groups ranging from $25,000 to $250 million in fundraising revenue. Perhaps the three biggest changes I have witnessed over the three decades are these:
1. Any size group can now use the Internet to access their data and avoid large budgets for IT hardware, maintenance and staffing. (HUGE game changer!)
2. Systems can be installed without large UPFRONT capital expenditures.
3. Systems for the most part are now more intuitive and easy enough for all of the staff to use!
The three monumental breakthroughs allow nearly all non-profit organizations to take advantage of such fundraising systems that can lead to their revenue generation and fulfilling their mission.
10 Biggest Myths in Order of Importance
I have always enjoyed my fellow Hoosier David Letterman’s nightly Top Ten lists. It is always fun to watch them gain in relevance as Dave works his way to the #1 reason for whatever the day’s topic is.
Top 10 Myths When Purchasing Fundraising Software
So with acknowledgment to David and his top notch writers please allow me to borrow his famous format below.
10. There is no need for all of the staff to have access to and use our new Fundraising System
This is a myth which has been around since the early 80’s propagated by most vendors and older systems due to two main reasons:
a. Older systems were difficult and often required a week or longer of dedicated classroom training to use!
b. Most vendors price systems based upon number of users, hence discouraging wide adoption. (BTW, most of the newer Web based systems now allow UNLIMITED users.)
If any person on your team, especially your senior management has any interactions at all with a prospective donor or existing one, then those interactions and valuable notes must be captured or your organization is at a disadvantage to those who do. Donors now expect such minute details to be noted and used!
9. If I have a choice, it is better to buy from a local vendor
This used to be very true in the days of on-site implementations and weeks of training. Now only just a handful of vendors still require a full week or more of training and even that can be done remotely via videos, if you can bear to watch 25 hours or more. Most new systems are implemented via web technology and only require viewing a few short videos. Can you imagine only buying the smart phone or laptop built near you? Fundraising software can be just as easy to start using, especially systems designed for the low to mid portion of the market.
8. We need to wait until our current system is no longer working
When systems used to require large upfront capital expenditures nearly every NPO put off changing or upgrading as long as possible. Now with pay as you go pricing, it is easy to spread the investment required for vastly improved systems over the full life of the system. No longer do you have to deprive your team and your donors of the huge number benefits and vastly improved ease of use. (In fact, in many cases the new system’s entire on-going cost may not be much different than those ever increasing maintenance fees on your current system!)
7. We do not need to research and verify how integrations with other systems will be done
No matter whether you are a start-up NPO with just a desire to integrate to an entry level accounting system or an email system or your web site or if you are a large charity with sophisticated integration needs, this factor is vital. In the past most, if not all systems, were not designed to share information in “Real Time.” We had to put up with primitive batch updates, which often broke every time one system or another was updated.
I would highly suggest only considering any system with:
a. A proven set of integration APIs (Application Programming Interface) (Such APIs enable real time updating of data between systems, which should now be the norm, not the exception!)
b. Along this same line, the APIs should be well documented, part of normal day to day support and FREE of charge. This should be a standard feature not a high priced add-on!
6. We can worry about interfacing to our web site later
Nothing could be further from the truth. A fluid interface and real time movement between your web site and your fundraising database/email system is essential. If they are not connected, you will have a nearly impossible time connecting with the entire next 2-3 generations of supporters!
5. There is no need to explore in detail and verify how our existing data will be transferred
This is the number one reason for botched implementations and unhappy users when new systems are brought in. Forcing the team to work with information riddled with errors is also why the board is often dismayed when the actual charges for moving the data far exceed the “rough estimate” provided by some vendors.
Please make every vendor review and accurately quote what the cost and steps will be to move your data over. In addition, pay close attention to the amount of consulting assistance offered in the data conversion, because I have never seen one yet where data consolidation and removal of some type is not required.
4. If a vendor is giving away free use of their system for a certain number of users then it is too good to pass up
All you need to do is check around with other NPOs to see how false this myth is. Such free offers are usually for systems designed to work for the commercial sector, not the charity sector. When you dig deeper you will often find upfront consulting and customization fees which dwarf the old upfront purchase price for fundraising software. We have heard of such fees exceeding $30,000 – $50,000 for even small organizations. Also, ask about surcharges for such items as data storage and credit card processing. The answers might surprise you.
(Plus, the organization often does not have anyone to turn to for day to day support, or worse yet, as changes are required due to revised tax laws or other government regulations they must pay more large fees for further customization. Such required changes are always handled in regular software updates provided by vendors dedicated to the sector.) (I would add another note of caution if the vendor providing the “free” system will not guarantee how long the “free” period lasts. There could be a significant change in your costs at some future date.)
3. There is no need to analyze the details of what each member of our team truly will need and use to perform 90% of their daily tasks
This one is huge and ties in closely with our Number 1 reason below. Only if you truly know what is essential for each person to have in order to better and more accurately perform the vast majority of their daily duties can you insure the system provides it. You can also compare which system performs those tasks the best with the least amount of steps. If this is not done, your team will often wander off chasing whatever shiny object some vendors will inevitably showcase. In most cases, the more expensive the system the more shiny objects are shown. (The sad part of this scenario is in their effort to add so many shiny objects/features most vendors ignoring streamlining the critical day to day tasks which consume 90% of the more of the staff’s time!)
2. We must make the new system look and act like our old system
Please do not confuse this myth with Number 3 above regarding essential day to day tasks. All of us have built in resistance to change. I have run customer focus groups for multiple companies regarding new products and features. Time and time again such groups never think or look outside the box. If you only listened to them, innovation, even radical jumps in ease of use is slowed to a crawl. Now I know why Apple never uses such focus groups as they radically innovate for so many of us. More times than not, large improvements cannot be made in a new system of any type without looking and acting almost entirely different from the old incumbent system. Such changes will be resisted by all but the most forward thinking of team members.
Drum roll please for Number 1 . . .
1. The system with the most features and functions must be the best one to buy
Wow, how can I issue the biggest warning ever here? Over the last 30 years I have been involved either directly or indirectly with more than 50,000 fundraising software buying processes. At least 50-60% of the time, I witness someone from the NPO organization trying to list all of the features offered by each vendor in a spreadsheet of some nature. In most cases there is no reference to the essential tasks being performed 90% or more of the time by all of the staff. In fact, rather than taking control of the purchase process, especially the demonstration, and insisting those essential functions are performed and analyzed, the NPO watches perfectly orchestrated demo after demo.
(Please allow me to bring you in on a secret, every vendor choreographs their demo to show the most shiny objects/features they can, while hiding any weak points such as the number of steps required to set the system up or to perform daily essential functions!) (Please also allow me to congratulate the top shelf consultants and the few vendors who conduct full needs analysis and use those findings to show only what is required to perform the real daily work by each member of the staff. Both seem to end up with the happy customers rather than ones who say they dislike their current system. How often have you heard this refrain from a non-profit database user? “We have too much time and money spent and therefore must exist in our daily misery rather than changing for the better.”
There you have it, ten myths we can all dispel with just a small amount of effort. The rewards of a staff who is delighted with their fundraising software system, which allows them to utterly delight your organization’s prospects and donors, are far too many to list here. Suffice to say, it will make an incredible difference in your fundraising success!