March 6, 2015 | Read Time: 7 minutes
Donor databases are a universal source of frustration. Many organizations are convinced that a new software system would alleviate stress and streamline operations.
But picking a new product requires a lot of time, careful thought, and, of course, a big financial investment.
Laura Quinn, director of Idealware, a nonprofit that provides information about software for charities, recommends that organizations take the following steps as they consider buying a new donor database program.
1. Determine your needs.
The first step is examining your organization’s fundraising processes and prioritizing what features are essential and which ones would be nice to have in a donor database.
Ms. Quinn cautions that there are trade-offs to every system, and nonprofits will be disappointed if they try to hold out for one that checks every box on their wish lists.
“If everything is critical to you, you’re never going to find a fit,” she says.
2. Reevaluate your current system.
Before embarking on the long, expensive process of purchasing and installing new software, take a second look at what your organization already uses and compare it to your list of needs.
It’s possible that your current system works well but your staff is not using it properly. Maybe “messy” data is cluttering it up, you haven’t installed important updates, or it has functions you didn’t know about or have never used.
“A lot of times, people are struggling to do things in their systems and they’ll look for another system and take a ‘grass is greener’ look at the market, thinking, ‘We’re gonna go get another system that appears to be shinier and newer,’ when, really, they just need to think harder about how their current processes can be supported,” Ms. Quinn says.
Realizing that your nonprofit can improve the system it already has can save your organization a lot of time and money.
3. Assemble a selection committee.
Ideally, one person should not bear the responsibility of selecting a new donor database.
Ms. Quinn recommends that nonprofits create a committee that includes the person in charge of fundraising, the person in charge of technology, and a member of the executive team who has authority to make official decisions and can think about the needs of the different employees who will use the new software.
If support staff use the current system, ask one of them to serve on the committee, too.
“They’re often doing the crazy work-arounds that no one knows about,” Ms. Quinn says.
Stacey Palevsky Lewis, director of development at Aim High, a summer education program in the San Francisco Bay area, says that two development staff members and the organization’s technology manager were in charge of its donor database selection process.
As with any committee, it’s important to appoint a chair who keeps the group on budget and on schedule.
At this point, your organization should consider whether it needs a consultant to help with the database-selection process. Ms. Quinn says many groups can select and install software on their own if their needs are not too complex, adding that building software expertise in-house may actually serve the group’s mission.
4. Learn about the marketplace, then narrow your choices.
There are a lot of options when it comes to donor databases. Ms. Quinn recommends using a resource such as her organization’s free “A Consumers Guide to Donor Management Systems” to winnow the choices down to three to five offerings to analyze closely.
Kara Bundy, development director at the Court Appointed Special Advocates for Children of Prince George’s County, started her search by participating in a discounted webinar with one company in order to create a baseline for comparison.
Your organization’s budget will, of course, inform your selection process. Ms. Quinn emphasizes the importance of asking about and budgeting for annual support fees.
“Occasionally, nonprofits will opt out of that ongoing support fee, but that’s a really bad idea,” she says. “If you can’t budget for the ongoing support, that system is too expensive for you. … Your software system is a dead product at that point.”
Newer donor databases tend to be cloud-based, which means both the software and your data is stored remotely on servers controlled either by the vendor or a third party instead of on local servers in a nonprofit’s office.
“The idea is the vendor is providing you with an online solution that is simply turnkey for you,” Ms. Quinn says.
Another benefit: Nonprofits don’t have to run their own servers to manage data or install software updates. Also, cloud-based systems have lower up -front costs, but organizations must pay for hosting each month.
Ms. Quinn says a cloud-based system is likely to have stronger security than a nonprofit’s local server, so only organizations with very intense security needs should worry about the safety of their data in the cloud.
5. Schedule demonstrations with vendors.
Arrange for representatives from the three to five vendors to demonstrate their systems to your team. Let them know in advance what fundraising processes are most important to you and refer to that list during the demonstration so you don’t get a generic sales pitch about each system.
“If you let the vendor guide [the discussion], you’ll get an emphasis on where its strengths lie,” Ms. Quinn says. “It doesn’t necessarily highlight the fact that when you have to do this particular process, this system will take nine steps while others will take three.”
Ask how different functions interact, Ms. Bundy advises, and whether they can integrate with your email and website systems. Her organization has been using four different systems, an inefficient setup that takes a lot of time.
“I realized the possibility to have an integrated system where we’re not doing all this duplicative effort and that allows us to get a better picture of our donors,” she said.
Ms. Quinn says to remember to take notes and consider devising a scoring system to help your team select a product.
6. Make a data-migration plan and hire a consultant.
Although not all organizations need a consultant for the selection process, Ms. Quinn strongly recommends that nonprofits hire one for the data-migration process — transferring information, such as names, contact information, and donations, between storage systems — unless someone on staff has a very strong understanding of it.
“You’re going to spend a lot more effort and angst and have trouble down the road unless you have someone who knows what they’re doing,” she said. “Migration is a foundation on which you are building the success of your new system. If you underinvest in it, you’re asking for trouble.”
Ms. Lewis agrees.
“Our current staff has one tech manager, and he wouldn’t have had the capacity to do all the work himself,” she says.
When considering a consultant, look for someone who has more experience with the new system than the old system, and make sure you understand what services are included in his or her setup fee, which can vary widely. Software vendors often offer these types of services with their products.
“They’re mostly trying to ensure their clients are set up for success,” Ms. Quinn says. “They’re not necessarily money-grubbing. They’re just as likely trying to make sure the investment in their system is a good one and will work for the organization.”
Be clear about your customization requirements, and figure out how the data will be backed up in the new system to ensure that if the vendor stops operating or the cloud server goes down, your data won’t be lost. Ms. Lewis advises making sure your consultant looks at your old data carefully and recommends how to clean it up before starting the migration process in order to save time and prevent aggravation.
7. Train your staff.
A great new database will be useless if the people who use it each day don’t understand how it works.
Set aside enough time to train staff about best practices. Aim High is holding brown-bag lunch sessions every other week to get employees up to speed.
“What I don’t want to have happen is we’ve spent all this money and time building a new system and there are inconsistencies with how we enter data,” says Ms. Lewis. “Or there are staff who just don’t get it and so are not using it.”
Consider having an employee receive extra training on the system so he or she can act as in-office support for the organization. Aim High paid $2,000 to have its technology manager trained to become a system administrator for its new donor database.
“It was really important as part of the sustainability of the project,” Ms Lewis says. “We didn’t want to keep paying a consultant.”
