Has the IT industry got its head in the clouds?

This year has been all about ‘the cloud’, or perhaps it has been about all about hosting by another name? Like Camberwell in the property market, electric cars in the world of travel, or Ireland as a holiday destination, hosting has been the ‘next big thing’ for a very long time now. The cloud on the other hand still seems new, though it has changed from being a simple analogy for the internet, to the hosting of an application somewhere on the internet, (but you didn’t need to know where), to being used with the addition of the prefix ‘private’ to describe any hosted application. So,it is hosting, but we’ll come back to that later. Anyway, however you label it, as IRIS starts to roll out ‘IRIS Open Hosting’ in earnest, I have been asking myself if this concept is really relevant to my clients, and if so why.

Well, this is a blog not a crime thriller, so I’ll tell you the answer straight away – it is relevant. As to why, that takes a little longer but here goes. Firstly, it’s not just about cost. For a long time, hosting didn’t get off the ground in some markets because to make it work, you probably had to slim down staff in order to recoup the cost of externally managed services, and organisations naturally try to avoid this. Now that is not necessarily the case. True, it shouldn’t cost any more, but there are so many hidden costs that don’t equate directly to staff numbers that it can pay for itself without having to ‘make difficult decisions’. The best evidence for this is from the IT departments themselves. As recently as last year, I would have hesitated to approach a client boasting a large IT department with a hosting proposal, on the basis that turkeys don’t vote for Christmas. Yet this year some of the largest IT teams we work with have been taking the initiative and raising the subject. There are a number of reasons for this, but I will limit myself to just three.

Firstly, we now all accept that we need a permanent connection to the internet to function for so many reasons, using possible down time to a remote location as an excuse not to do it makes no sense any more. Secondly, clients want stakeholders, (donors, members, customers etc), to be able to interact with them via websites or email at any time of day. That means ensuring that all key servers, i.e. those running email and the CRM database have to be available 24/7 as well as the main web site server. Thirdly, as is so often the case with IT issues, we can’t ignore Microsoft. The men from Redmond are encouraging us all to host all our generic applications – Office, Email, Sharepoint , and why not, when you think of the pain an organisation goes through each time it upgrades to the next version of Windows or Office.

To come back to the hosting/cloud issue, it is useful to talk about the cloud, because it reminds us that we are talking about so much more than moving your key server out of the office, because we are already moving away from local area networks to a world in which everything is online. As the IT Director of a major UK charity remarked to me recently – ‘Hosting has to be the way to go for us, as far as I am concerned, we would be mad not to’. Head in the clouds? I don’t think so.

Are 19 CRM databases really better than 1?

This is the thought-provoking debate prompted by the latest blog by Richard Boardman who styles himself on Twitter as @crmadvisor. As is often the case with provocative statements I found I reacted to this in a number of different and contradictory ways. Firstly, as a leading supplier of Enterprise Wide CRM solutions to the charity sector: “19 CRM systems! What a nightmare!” followed by, “Only 19! We come into contact with charities all the time who say they have hundreds of CRM systems”, and finally “Well 19 may be too many, but you can rarely reduce all the complex relationships in a business to one single over-arching system.”

I can recall more than one instance of implementing a database alongside a team of consultants poring over many-coloured spider diagrams representing every known contact and relationship, only to learn that the [insert catchy name] single CRM project had lost out in the latest organisational re-shuffle.

Richard makes the point that many companies achieve great success with no CRM system at all, although he believes that this is because they never had a senior level business sponsor? He explains that by saying ‘..many organisations simply don’t have the right senior level staff with time on their hands’. I wonder however if the real reason is business need. There is, and should be, a Darwinian element to the rise and fall of systems. If a business, or charity, really needs a CRM it will create one. If that system costs more effort to maintain than the benefit it delivers, it will not succeed.

A core CRM system is an absolute essential for non profit organisations, because commercial accounting and ERP systems are just not suited for the main fundraising or membership application, i.e. the processing of high volume cash transactions with the only deliverable being a highly tailored communication or welcome pack. Cash books and sales ledgers and sales order processing systems just won’t cut it.

As an NFP, there is no doubt, you need a CRM system, but to return to the original question, do you need 19 or should you strive for just 1? At IRIS NFP Solutions, we take a pragmatic approach. On the one hand, many systems that have grown quickly in response to an urgent need, have natural marketing cross-overs with the core system, and should be amalgamated back into a single central system. The much sought after 360 degree view can, and does, provide exponential growth in activity by facilitating carefully targeted cross marketing. However, there may be good reasons in some organisations why even the most obvious candidates (event management, web databases, legacy marketing, regions, sales order processing, etc etc) should not be merged.

Our view is that we should encourage and support the move to an Enterprise-wide system that promotes the 'single supporter view', and we are uniquely placed to support this, but that we should only do this where the synergies are obvious, and the benefits outweigh the risks. Leaving aside the desktop databases, 19 is far too many CRM systems, but equally, one may prove to be an unobtainable mirage.

Government Giving Green Paper - has it missed the point?

It’s been out for a while, so there is no time left to comment on the Government Green Paper on Giving - comments must be in by 9th March i.e. today. However, as one of the big themes is Technology, I am going to have my say for the record. The paper can be downloaded at www.cabinetoffice.gov.uk/ and includes details on how to respond and contribute to the debate.

However much this paper tries to claim an altruistic set of motives, at the end one is left with one abiding impression - this is all about saving money. Yes, this is the wolf of the deficit agenda in sheep’s clothing of ‘The Big Society’. You could argue the Government is doing its best to cut out the middle man, by finding ways to get the taxpayer to fund services without the cost of public administration. In fact, the Government wants us to find those ways by ourselves based on its suggestions. However, the Paper rightly asserts that technology holds at least part of the key to promoting growth in the giving of time and money, so whether it is doing it for the right reasons or not, as NFP technology specialists, I and my colleagues at IRIS have an opinion on its ideas.

The key technology ideas referred to in the Paper are, click-to-give sites such as EveryClick, further promotion of event based giving sites such as Justgiving and VirginMoneyGiving, ATM giving, mobile, websites like Givey that act as clearing houses for volunteer time as well as money, websites that encourage discerning gifts such as IntelligentGiving, and so on. There is plenty of discussion of the role of Social Media, Online Causes, and microfinancing.

It seems though that while the authors have trawled a lot of sites for ideas, and spoken to a lot of people, they have ever tried their own hands at raising money for charity. Fundraisers know the key to success lies in building long term relationships with donors and getting them to be involved in the cause. In contrast, many of these technology driven ideas rely on chance opportunity – at your ATM or while filing in your tax return, and the superficial relationships that arise from online encounters. Anyone with school age children will know that their Facebook communities thrive far more impressively than our adult ones because they see most of their online community every day in the corridor.

There is no doubt that mobile will play an increasingly important role, and IRIS clients are already using both SMS text donations and mobile ‘Apps’ to gather funds from donors on the move. Again, the donation gathered on the move should never be seen as an end in itself. The key here is to add that to the sum of knowledge about each donor in the core donor database, so as to optimise future donations by both mobile and offline channels. SMS campaigns have shown that as many as 20% of text donors will offer to Gift Aid their donations, which gives the charity the address of the donor and an opportunity to develop the relationship.

The paper makes much of the statistic that almost half the total donated comes from less than 10% of the population. Increasing the number of people making small adhoc donations will do nothing to change this statistic unless they are turned from occasional to regular givers. One way to do this is to interact with donors through as many channels as possible , online and offline, locally and nationally, through events, corporate tie-ups, product sales and raffles, and the only technology that really supports this strategy is the Customer Relationship Management database.

Of course, new technologies and online participation vehicles have a huge role to play in helping to increase the overall level of giving, and maybe this Green Paper doesn’t mention CRM databases for fear that the Big Society sounds too much like Big Brother, but they must still remain at the heart of any IT driven strategy to increase giving.