Bridging Old Divides

Shared technology tightens relationships among affiliates

The Crohn’s & Colitis Foundation of America had long wanted to bring all of the information about its donors together

in one place to help the group strengthen relationships with supporters and better tailor its solicitations. But when the organization proposed building a common database to link the fund-raising records of its 33 chapters, the initial response from some of the local groups was lukewarm at best.

“Chapters for the past 30-whatever years have worked very independently, so they have become somewhat territorial and definitely protective of those donors that they believe are theirs,” says Marilyn Haggerty-Blohm, executive director of the organization’s Greater New York chapter. “There was a huge fear that someone else was going to approach our donor.”

To allay those fears and build crucial support for the database, the Crohn’s & Colitis Foundation set up committees that included employees of all ranks from the national and local offices. The groups held a series of meetings over three months to lay out the ground rules for how information would be shared, and by this summer, every chapter is expected to be using the same database.

“We tried to get some of the most opinionated people on both sides of the argument so that we’d be sure we touched on all their concerns,” says Elizabeth Myatt, chief technology officer at the Crohn’s & Colitis Foundation.

Demands From Donors

Technology offers national organizations with affiliate networks an unprecedented opportunity to share information and coordinate activities at a time when their supporters increasingly expect local chapters and national headquarters to be on the same page. Even charities with a long history of local control are taking notice and starting shared technology projects.

Some are getting everyone to use the same administrative software, such as the Crohn’s & Colitis Foundation’s fund-raising database. Easter Seals and other organizations are offering Web-based software to help local groups build a strong Internet presence and raise money online. Some groups are deploying common software to help affiliates carry out their missions, such as inventory-tracking software that America’s Second Harvest has made available to its member food banks.

Costs of Sharing

Although many charity federations readily see the potential benefits of tackling these projects as a network, rather than individually — lower overall costs, access to technological expertise, and the ability to present a unified front to supporters — fewer understand the challenges associated with building a shared system.

While long-term costs may eventually be lower, the initial investment can run into the millions of dollars. To take full advantage of what the systems have to offer, organizations often have to standardize the way they perform certain tasks. And sometimes even after a tremendous investment of time and money, the systems just don’t work out.

Perhaps most daunting of all, organizations have to navigate, and in some cases redefine, the often fraught relationships between a charity’s headquarters and its local affiliates, a tension that almost always involves questions of money and autonomy.

“People instantly react and say, ‘Well, you have no top-down, legitimate authority to say you will do this because we said so,’” says Marla Davidson, chief information officer at the Arthritis Foundation, in Atlanta.

Ms. Davidson says that when the organization moved in 2001 to a shared fund-raising database, some affiliates were so worried that the national office would try to poach their “cream of the crop” donors that they did not include information on their largest contributors in the new system.

With time and the ground rules that the charity laid out for using information in the database, that fear has subsided significantly. Affiliates, for example, can flag the donors that they don’t want to receive mail solicitations or telemarketing calls from the national office. Even so, Ms. Davidson says she wouldn’t be surprised if there were still a few holdouts.

The Arthritis Foundation moved to the shared database so that it would have a central location to record the different ways a supporter has interacted with the organization, whether by making a gift, volunteering, serving as a board member, or participating in an event.

Putting all the information in one place allows the organization to make sure that it sends information and solicitations tied to a person’s interests. Such an approach is especially important in sending out direct-mail appeals: The Arthritis Foundation says the percentage of donors who make repeat gifts is higher when donors receive solicitations that mention the form of arthritis that affects them than it is when they receive the organization’s more general appeals.

The database also allows the organization to track supporters who move from one part of the country to another or who split their time between two different regions, like donors who live in New York in the summer and Florida in the winter and make gifts to affiliates in both states.

Changing Expectations

The technological changes are being driven, in part, by the expectations of charities’ supporters, says Doug Barker, president of Barker & Scott Consulting, in Washington. In the late 1990s, Mr. Barker helped lead the Nature Conservancy’s move to a shared donor database.

He says that as technology has changed the way for-profit companies interact with their customers, allowing sales representatives to instantly know a person’s buying history and make recommendations based on past purchases, donors have started to expect similar personalized treatment from the charities they support. Donors are far less forgiving, he says, of faux pas they might have let slip in the past, like getting a call from a telemarketer at a charity’s national office who says, “I see you haven’t given for a while,” soon after the donor made a major gift to a local affiliate.

“People expect when they contact an organization that whoever they talk with anywhere within the organization has at their fingertips all of the information and the interactions that they’ve had,” says Mr. Barker. “They expect the person to really know them and to know all the different ways in which they’ve been involved with that organization.”

Putting in place an integrated database that allows that kind of personalized relationship is much more difficult in a federation, like the Arthritis Foundation, in which local affiliates are separate legal entities with their own boards of directors, than in centralized organizations where the national headquarters and local chapters are all one legal entity.

Even so, Mr. Barker thinks the stakes are high enough that some groups will question, and even rethink, their organizational structures.

“In some of these cases the answer is going to be yes, that they’re going to need some new ways of looking at themselves as more of an integrated whole than as these separate ships out there,” says Mr. Barker.

Spurring Collaboration

Even for organizations that are highly centralized, shared fund-raising systems can be a catalyst for greater cooperation.

So far 24 of the Crohn’s & Colitis Foundation’s 33 chapters are on its new database, with the remaining chapters scheduled to be added by July. And already the shared information is spurring more interaction among chapters. The New York chapter, for example, has fielded calls from fund raisers at other chapters who want to learn more about its Women of Distinction luncheon, and it, in turn, called the Atlanta chapter to learn about the group’s successful golf outings.

Ms. Haggerty-Blohm, head of the Greater New York chapter, realized the benefits of the shared database when her organization started planning an event for a new group of donors interested in research. By searching the fund-raising database for New York-area donors who had given $5,000 or more to the organization overall — either at the local or national level — and at least $1,000 specifically for research or programs, the charity was able to quickly identify 70 names for its invitation list.

What took 15 minutes in the new database would have involved hours of combing through the chapter’s old and often out-of-date database and the separate spreadsheets that staff members kept for the annual gala and other fund-raising events, Ms. Haggerty-Blohm says. And she wouldn’t have had any way to locate donors in the New York City area who have given the national office money to conduct research to combat digestive diseases.

“Now,” she says, “I have the time to make a phone call to that person, seek to get them more engaged directly with us, and therefore, one would hope, more interested in giving bigger dollars.”

Monitoring Clients

Nonprofit organizations that build technology systems to help them carry out their charitable activities are looking for many of the same benefits as their counterparts who have developed shared fund-raising databases: efficiency, consistency, and greater sharing of information.

Goodwill Industries International, in Rockville, Md., has spent $2.5-million over five years to develop GoodTrak, a Web-based case-management system it began rolling out five months ago to help local Goodwills follow the progress of people they train and place in jobs. Before it even began to build the system, a customized version of an existing software application, the organization spent two years talking to local groups to find out what they needed.

Charles D. Layman, chief executive officer of Richmond Goodwill Industries, in Virginia, believes that the new system will help his organization better serve clients and provide the information he and his colleagues need to improve the organization’s performance.

Before moving to the GoodTrak system, the Richmond Goodwill, one of 25 local groups now using the system, relied on a homegrown database combined with paper files to record information about its clients.

Mr. Layman says that having all of a client’s vital information — the services they are receiving, participation in training and educational programs, case notes, and other data — in one place gives Goodwill’s caseworkers a more complete picture of that client, and helps them do a better job helping him or her.

Because all of the information is stored electronically, the system can aggregate the data to give managers a real-time look at where demand is highest for the organization’s services, what groups of people it is reaching, where the organization has succeeded, and which areas need improvement, says Mr. Layman.

That kind of data crunching was difficult under the old system, and didn’t happen very often, because information was stored in multiple locations.

“To be honest, we really didn’t know until the end of the year what was going on,” says Mr. Layman.

With the new system, he says, the charity will be able to identify problems, such as not reaching clients in a particular geographic area, as well as opportunities, like a class becoming so popular the group needs to hire an additional instructor, and can adjust its strategies much more quickly.

Because the GoodTrak system will standardize the way affiliates record data, Mr. Layman says, it will eventually allow him to compare his organization’s performance to that of other Goodwills, and to learn from groups that have found solutions to challenges his organization faces.

That uniformity will also make it a lot easier for the organization to report program results to government agencies and foundations that support projects that involve multiple local Goodwills, says Steve Bergman, chief information officer at Goodwill Industries International.

Donated Food

Food banks across the country have used inventory-management software made available through America’s Second Harvest, in Chicago, to speed up the process of getting donated food to the food pantries and feeding programs they serve and increase the amount of food they distribute.

The Regional Food Bank of Oklahoma, in Oklahoma City, for example, used the software to offer online ordering. That allowed the food bank to give other tasks to two workers who spent most of their time taking phone orders.

But America’s Second Harvest does not take those improvements for granted. When its first inventory-control program failed, the organization learned the hard way that systemwide technology projects are not guaranteed to succeed.

Initially the organization’s national office had been looking for software that would allow it to link to companies that make large food donations, which America’s Second Harvest then distributes through its network of local food banks. The vendor that the organization was negotiating with to purchase the system offered to throw in licenses for affiliates at a heavily discounted price to sweeten the deal, and America’s Second Harvest agreed.

Selecting software with one group in mind — national food companies — and then trying to make it work for another audience — the local food banks — was the biggest reason the first system did not work for America’s Second Harvest, says David Prendergast, the organization’s senior vice president for planning and technology.

While the complex software was a good fit for food companies, “it was not well suited to our headquarters here or to our members,” says Mr. Prendergast. “They are much smaller in operation, have different ways of doing things, and the software was not very flexible in allowing those differences.”

Mr. Prendergast says the decision to scrap the first system added to pressure when the charity unveiled the current system.

“I remember telling staff and other managers at the time, ‘We really only have one more chance to get this right. If we screw it up the second time, then forget it — and rightfully so,’” he says.

Two of the most important lessons Mr. Prendergast says he has drawn from his group’s experience is the importance of always keeping an organization’s objectives in focus and being skeptical about what technology can achieve.

“It’s really important to take advantage of what’s out there — don’t get me wrong — but I see a lot of organizations focused on the technology instead of on the business,” says Mr. Prendergast. “The focus has to be on the business. What is it that we’re trying to accomplish here?”