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How to Select a CRM for Your Nonprofit Organization

Databases & Constituent Relationship Management (CRM)

By: Igor Skapinker, RedSoft Global Services Inc.

What does CRM mean for Nonprofit Organizations?

The term CRM stands for “Customer Relationship Management”. For nonprofit organizations, CRM systems provide a wide variety of tools that support all aspects of organizations’ interactions with their clients. Successful CRM implementations help organizations to attain their strategic goals and to provide better services to their constituents. That requires a clear understanding of who the organization’s client(s) are and what the interactions with each client looks like.

Therefore, the first question that nonprofit organizations need to answer before embarking on the CRM implementation is “Who is our client?” Not surprisingly, there are as many answers to this question as there are types of nonprofit organizations out there. Foundations, for example, might decide that if fundraising is one of their major goals they need an efficient way to manage donor relationships. In this case, their donors will be their primary clients and fundraising their major activity. Associations, on the other hand, provide services to other organizations or individuals. Therefore, they might focus their CRM implementation on the organizations or individuals they serve.

Another important question is “What CRM solution should we use?” As the goals of the CRM implementation are different, there is no single CRM solution that will fit the needs of all organizations. Thus, selecting the right CRM solution for your organization is an important step in the successful implementation that will ultimately provide the highest ROI (Return On Investment).

Selection Criteria

The market for CRM software is extremely saturated with literally hundreds of vendors all claiming that their system is a world class, best of the best, innovative, leading edge technology, etc. You will probably feel overwhelmed when you look at the long list of the vendors and their solutions. In order to not get lost and to find your way through the large number of products, you need to take a systematic approach to the system selection. Although there are hundreds of different criteria that you could look at when you evaluate systems, it is not practical to analyze all of them for all systems. First, it will take a lot of time and effort. Second, vendors are releasing new versions of their products all the time, and by the time you finish evaluating, you might find out that a lot of information became obsolete.

Therefore, you need to find an efficient way to narrow down your list and to remove the solutions where you don’t need to do any further analysis. At this stage, you can use a simple criteria so you don’t need to spend too much time on each product as the list is still too long (criteria will be different for different organizations). For example, if employees and volunteers need to have a remote access to the CRM system, you need a Web-based system rather than an in-house one. Price might be another criteria that will allow you to quickly see whether system implementation fits your budget.

After few such iterations, you narrow your list down to 3-4 strong “candidates” so now you can do a more rigorous analysis of these systems based on the more extensive selection criteria. The following are just a few of the many selection criteria that can be used to select the CRM system for your organization:

Functionality
Does the system provide the functionality to support your organization’s operations? Remember, your organization should not need to change its operations in order to use the system unless it makes it more functional. If the functionality does not exist, it only means that this system is not suitable for your organization.

Product Maturity
Product maturity will tell you a lot about the system: is this system new or has it been used for years, how many customers use it, how stable is it, etc. These and many other questions are important in your choice of the system as your organization’s operations will depend on it.

Process Automation
The system should provide tools that allow you to automate processes. Without automation, the system will be just an information storage (i.e. it will be just a little bit better than Excel spreadsheets). Therefore, the system must provide tools to create and manage workflows, events, notifications, etc.

Reporting
As a manager accessing the system you might need to be able to run various reports with a click of a button. Therefore, reporting capability is another mandatory requirement that the system should support.

Customization
There are no two organizations that are exactly the same. All organizations are as different as the services they provide and people they serve, so it is impossible to have a system that will provide all functionality just the way your organization needs. There are always things that need to be adjusted.  Therefore, it is important that the system can be easily customized to satisfy your organization’s needs.

Extensibility
Not only does some special functionality not exist in the system today, but in the future, you may want to  implement a new functionality to support your organization’s new initiatives or modify existing functionalities to comply with new regulations. Therefore, you should be able to modify or extend the system in the future if it is required.

Available Expertise
As organizations try to save implementation costs and implement the systems themselves, it often becomes less efficient, more expensive, more distracting for organization’s employees and volunteers, and more time consuming than hiring external help. In most cases, it’s far better to find external expertise in the systems that you are trying to implement as it often requires specialized knowledge, so if you can, try to find external help.

Hosted by Us or Cloud Based
This is another decision that you need to make when selecting the system. While the system that your organization will host itself might look more cost effective when you buy a system, in reality, this is not always the case. You also need to take into account that there will be expenses related to hosting and managing the system should your organization decide to do so. Alternatively, a cloud based solution might look more expensive, but ultimately, it will be less expensive since system hosting and management (including upgrades, troubleshooting, bug fixes, backups, etc.) are taken care of by the hosting provider. Therefore, you need to take into account how fees are calculated (by user, or by record) when doing the comparison.

Support
The system should be accessible all the time since your organization’s operations rely on it. If there are any problems, or your organization is facing some challenges with the system, you should be able to get support from the vendor any time you need it.

Pricing
Usually nonprofit organizations are very sensitive to the pricing. Therefore, a very important question that will influence the decision is how much it will cost to implement the system and to manage it. What is the so called “Cost of Ownership” of the system? Is a free open-source version of the system available and does it include the full functionality required by the organization? Does the vendor offer free or discounted licenses to nonprofit organizations?

Here we described just a few (but important) selection criteria. Keep in mind that there are couple hundred more criteria you could evaluate.

Evaluation and Decision

A commonly used tool to make a final selection is a decision table. Rows in this table represent selection criteria, and columns are the systems that you analyzing. You fill the table as you go and in each cell write a number of points that you give to a particular system based on a certain criteria. For example, you could give points from 1 to 10.

In order to take into account that some criteria are more important than others, you can assign a weight to each criteria. When the table is completed, you can sum points in each column multiplied by the corresponding weight.

When this math is completed (don’t worry as the math itself is simple), the decision becomes obvious. The “winner” is the system with the highest score.

 


About the Author

Igor Skapinker is a technology management expert at RedSoft Global Services Inc.
RedSoft Global Services is a Toronto based information technology consulting firm. RedSoft helps organizations dramatically improve their operational efficiency and accelerate growth using information technology. At RedSoft they believe that technology should support an organization’s strategy and be aligned with organizational goals. RedSoft consultants serve as trusted advisors and partners and do this through innovative technology, experience, skills, and a client-centric focus.

 

Comments

CRM Salesforce Foundation

We transferred to Salesforce on the recommendation of JDQ Systems. It has its challenges but there is a lot of help available. I would appreciate more review of Salesforce Foundation and its work with non-profits. Salesforce is used by many large companies/organizations. The main challenge in my view is the buy-in of your staff.

Great suggestion!

We'll definitely tackle reviewing Salesforce, but our review may take a while (gathering info & testing data!). In the meantime, we have two resources that may shed light on Salesforce for nonprofits:

  1. How a Good CRM Implementation Can Propel Your Nonprofit
  2. 5 Key Things you Need to Know About Salesforce

As with any software solution, we don't believe in a one-size-fits-all. What really counts is good planning and proper implementation. Even if Salesforce may be the right tool for you (or other organizations), a poorly implemented Salesforce is another issue.

Hope this helps!

- Joyce Hsu, Communications Lead
TechSoup Canada