Sunday, September 26, 2010

The Freedom of Choice

When it comes to selecting a solution for constituent relationship management (CRM), nonprofits can choose between two models: single vendor or multi-vendor. Generally speaking, the benefits of the former seem to be best-suited for small nonprofits, whereas the latter model is ideal for enterprise organizations with more complex processes and business requirements. If you break down the needs of large nonprofit organizations, then the advantages of a multi-vendor strategy become even more obvious.

1 . Need for best of breed tools. Large nonprofits have business requirements and processes that are unique to organizations of their size. They want solutions that were designed specifically to support their needs, such as wealth screening or performance measurement. In a multi-vendor scenario, a nonprofit can choose the best tool to meet its organizational requirements; there is no need to settle for “good enough”. By choosing best of breed tools, each department within an organization can stay on top of – or ahead of – the technology curve. This will help the organization achieve its mission more efficiently and effectively.

2 . Need for innovation and flexibility. In the world of technology, innovation is happening at an unprecedented pace, both in the for-profit and nonprofit worlds. In this fast-paced environment, enterprise nonprofits need the flexibility to incorporate this innovation into their latest endeavors. These new offerings can be incorporated easily into an organization’s CRM toolkit when they are used in conjunction with a solution built upon open standards. However, if an organization uses a closed solution for their CRM, then they become reliant on the innovation ability and timeline of their technology vendor. These two factors can significantly constrain the speed at which a nonprofit can evolve its use of technology and advance its relationships with constituents.

3 . Need for diversification of risk. If a nonprofit opts for a single vendor model, then they are essentially at the mercy of one firm. Some nonprofits are eager to minimize the inherent risks of this approach to ensure the organization is not negatively impacted by the decisions and resources of a single vendor. Opting for a multi-vendor approach can substantially decrease the risks associated with such important areas as pricing, product direction, and product expansion, thus leaving the nonprofit in a more powerful position when it comes to the future of their technology strategy.

4 . Need for control. Enterprise nonprofits typically have technical staff who are well versed in the organization’s technology needs. They want to – and should – be in ultimate control of which technology should be used to support the nonprofit’s business requirements. The multi-vendor strategy does just that, leaving the nonprofit with the power to make decisions that are in their best interest. For example, if a new, more robust tool for wealth screening becomes available, the nonprofit can weigh the pros and cons of making a switch based on what makes the most sense for the organization.

Choosing the best CRM solution for your organization is never easy for nonprofits of any size because of the impact this decision can have across departments. Large nonprofits, in particular, need to ensure they choose a flexible solution that not only meets their complex business requirements, but also allows them to stay ahead of the curve when it comes to executing their technology strategy.