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Help non-profits improve fundraising processes at TechEd Innovation Weekend

  I’m very excited to be part of Innovation Weekend coming up at TechEd Berlin and Las Vegas. As part of SAP’s Corporate Social Responsibility team focusing on our Technology Donations, I have seen first-hand the many challenges non-profit organizations face. I’m very proud to be part of this event and grateful to all of those in our community who are helping to solve these challenges. I’ll be writing in more detail here about some of the business cases attendees will be working on.

A perennial challenge for non-profits is fundraising processes. Not only is this difficult to do – especially in a challenging economic environment – the process is very unpredictable. Without some insight into the process, organizations find it incredibly difficult to plan effectively. How can you make decisions when you are not even sure if you will have the budget to execute on your plans?

An organization we worked with in Vancouver with this challenge is Arts Umbrella –  Canada’s preeminent arts institute for young people, ages 2 to 19. The not-for-profit began operating in a small rented space in 1979, with 45 children attending. Today, Arts Umbrella operates in a 22,000-square-foot facility in Vancouver, British Columbia, and has numerous partnerships with other organizations across the province of BC. Arts Umbrella estimates that, during 2006 and 2007, more than 36,000 children attended classes, workshops, and outreach performances. Arts Umbrella has more than 150 staff and faculty members, making it the second largest employer of artists in the province. In addition, over 300 volunteers assist in a variety of ways, predominantly in fundraising efforts.

While Arts Umbrella has grown steadily to become a world-class art center, technology in general at the organization has been a slow-going process. In the year 2000, Arts Umbrella changed its database system over to Raiser’s Edge, a database used primarily by not-for-profits in the fundraising sector. “Unfortunately,” says Scott Elliott, director of development at Arts Umbrella, “we didn’t have the capacity in-house to run that system properly. And we had no training. So we floundered around, not able to pull any reports out of the database at all.”

Because of this lack of visibility, the ability to understand where donations were at the time, what the likelihood of achieving goals was extremely difficult

Arts Umbrella requires the production and distribution of a variety of reports, but two reports are especially critical – on a weekly basis. One is a forecast report, which summarizes the other report needed: a full listing of who the organization’s canvassers are, who the canvassers’ prospects are, what kinds of funds are expected from these prospects, and so on. Compiling these reports was a difficult, time-consuming process. “I would export pretty much raw numbers from Raiser’s Edge into an Excel file,” says Elliott. “And then I’d spend literally days massaging those numbers to get them into some kind of report. I never had any confidence in the finished report. Another problem was that I wasn’t able to correct errors in a quick manner because we were running two systems. Whatever I had in the Excel system, I had to re-input back into Raiser’s Edge. It just wasn’t dynamic at all.”

In addition, the reports and data were difficult to access – especially for those working remotely, interacting with potential donors and those attending events.

While the reporting is a major challenge, the other piece of the puzzle is managing process. Sales organizations often use a pipeline funnel process to predict sales. They know that if they send out 1000 emails, 100 people may respond to an offer. Of those 100, 40 may go to the next step of the process and 10 may actually purchase. Non-profits have the same type of process. When fundraising emails go out, a small percentage of people respond. A subset of these may want to sit down with someone from the organization to talk about a donation and a subset of those will donate. Understanding the relationships of these phases of the process and building this into a model really helps streamline and optimize the process.

Once this is in place, the results can be impressive. “For example”, Elliot says “we can now better project our annual campaign. We worked with SAP to identify the three or four characteristics that, when tracked, are great indicators of the likelihood that a pledge will or will not actually close. This ‘probability formula’ helps us predict – with a high degree of accuracy – who’s going to eventually give and who isn’t.”

This level of reporting, Elliott says, allows Arts Umbrella to motivate its canvassers by being able to say, “You have this prospect, and they’re currently at a 10% chance of coming through with their pledge. Here’s what you need to do to move them up to 70%.”

Those working on this challenge have a huge opportunity to help non-profit organizations become more efficient, effective and ultimately help more people.

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