How you can reduce operating expenses by $30,000 a year
Picture this, you’re a nonprofit executive tasked with updating current programs to reflect the reporting requirements of new funders. This new funder wants reports on metrics that you’ve never heard of and your organization has never recorded. Basically, the funder is making stuff up and forcing you to deal with their whims.
This was the position I found myself in years ago when I was working at a nonprofit and one of our funders decided that they wanted individual client stories from program participants and I had to figure out how to make it easy for staff to record client stories while also making it easy for management to retrieve these stories for reporting.
Anyone who has ever worked in a nonprofit can tell you how much of a hassle reporting is. Some funders have very specific and detailed formats, while others have almost no format. Some funders just want to know how many clients were served while others want to know if your clients had a burrito for lunch.
Funders create all types of crazy metrics to measure the outcomes of their funding dollars and then we have to figure out how to make it work with what we do. Changes like these have a significant effect on the operational and financial functions of the organization at best and cause major operational slowdowns at worst.
At my org, we adopted customer-centricity! Customer-centricity(CC) is the idea of modeling your organization to meet the needs of your highest value market segments. That means, making sure that you take care of the customers that matter most to you by providing the services that meet the needs they have in very specific ways. Customer-Centricity is achieved by analyzing the voice of the customer consistently and keeping a feedback loop open for customers to tell you about their experience.
Nonprofits are already fairly customer-centric however, implementing this strategy can help save time and resources that most orgs can’t spare. Most nonprofits record very specific data points about their clients and keep track of obscure details that help paint a picture of this client’s particular need. However, often times we lose track of the voice of the customer in keeping track of the latest field research and producing reports for our funders.
Well then, how can a well-meaning nonprofit exec manage all of these data points and keep track of a particular customer’s need that may be lost in the sauce? In comes the Customer Relationship Management system, or CRM. CRMs allow you to track many data points easily while also streamlining reporting, effectively alleviating the heavy lifting required for reporting.
How did it help me?
I had been in my position for a few months and my job required me to manage all of the program data (of course while wearing seven other hats that were never in my job description). It was a ton of responsibility and required me to chase after other people and my boss to get their data. I was completely lost for a while and I knew I couldn’t continue on like that, my boss agreed and told me to look for a software to help me manage the data. I immediately looked into Salesforce (mostly on a whim) but as I dug I found that it was the perfect solution for us. So, I began my campaign to get salesforce. There were plenty of no’s because my boss wanted to use another software but eventually, he gave up and agreed, then we began pressing senior management to “ok” the software. Eventually, they said yes and I got my CRM. I was enamored and terrified at the same time because Salesforce is a behemoth.
I immediately began studying how it worked and trying to learn everything I could because it was this hard to get the program, and they definitely weren’t going to let me hire someone to build it out for us. After a few months, I got pretty good at it and we had a working software. A year later and I was able to automate much of my data management responsibilities (which reduced the hats I wore from seven to five) and the company saw a $30,000 decrease in yearly expenses. Implementing the CRM changed everything; reporting became a few clicks of a button, turning a day and a half long activity into an afterthought. The team was able to focus on service delivery because the CRM automated many of the more mundane tasks. It also allowed management to be proactive in assessing the program performance. Senior Managers could have reports sent to them automatically or could pull performance data as needed. The same happened when I moved to another nonprofit and brought my salesforce knowledge with me. We changed up some processes and reorganized the data collection and was able to reduce payment processing time by 66%.
The applications of CRMs and customer centricity don’t end at operational and reporting improvements, the fundraising team could also benefit from being able to access data and tell more compelling stories to funder and donors to generate a more powerful fund-raising strategy without the need to slow down the program’s operations.
At the end of the day, Customer-Centricity reflects a strategic change that can benefits nonprofits in the many ways; making them more agile and robust in the changing funding landscape and making them more appealing to funders in the long-run.
