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Apr 18, 2024

Top 5 Mistakes: #5 CRM Expectations

I have been analyzing the fundraising business for nearly three decades and over the years I keep seeing nonprofit organizations making the same mistakes. These errors hold organizations back.

If you are new to fundraising, please commit yourself to avoiding these five errors. Your organization probably won’t thank you. But you and I will both know that you are secretly saving your organization.

Number 5: Thinking a new expensive CRM system will solve your fundraising problems.

While a new CRM system can sometimes be helpful, all too often I see nonprofit organizations make huge expenditures on fancy new technology that yields no fundraising lift. The sad truth is that CRM conversations are usually over budget, take far longer than anyone forecasted, and oftentimes make visibility into fundraising trends worse in the short-term.

When I started in this business as a bright-eyed analyst during the Clinton years, I was confident that by 2010 we would have all fundraising data issues resolved. But here we are in 2024, and my team spends more time on data issues than we did in 2010.

Why is that?

In my view, too often CRM systems are seen as fundraising solutions. They are not. They are tools. And a new tool is only as good as the person who uses it. Too often organizations will make a 7-figure investment in a new CRM without budgeting a dime to train their staff on how to fully utilize it. Oftentimes, IT staff get frustrated with the lack of training (or the stress of running a system they don’t know how to use) and leave. When the organization then goes out to hire a new database professional who is familiar with their new CRM system, they learn how expensive these people are . . . the organization simply can’t afford to hire them . . . which causes more turnover. So, the organization is worse off than they were before the database conversion.

Before you make the decision on moving to a new system, please consider these 5 things:

  1. Be very specific about what you want the new CRM to achieve and find out if there is any way to adapt the current system or give your team more training on the system you have. You will be much farther ahead in the long run.
  2. If you really need a new system, budget in twice the amount of money that was originally proposed. Yep, double it. Same with the time frame.
  3. Pick a CRM that has been in the market a while. You don’t want to be the beta-tester on a system that no one has ever used.
  4. Commit to fully training your staff on how to use it. Your new CRM system will be useless unless you have people who know how to operate it.
  5. Plan on running parallel systems for 6-months to make sure you can still function if the new systems have bugs. You don’t want to risk your CYE campaign drops because of CRM issues.

I know I have been called the “Andy Rooney” of fundraising because I tend to be suspicious of any new-fangled database solutions. The bottom line is that fundraising is all about relationships. First, how the organization trains and empowers its staff, and second, how its staff treats its donors. CRM can be a tool that enhances the ability to maintain and cultivate relationships, but they are not fundraising solutions in themselves.

 

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