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Top 10 Reasons For Failure with Nonprofit Software


Looking back over the years, I have personally worked with well over a thousand nonprofits (& for profits) involved in the evaluation of Membership Systems, CRM Software, & Donor Databases. And, in the last decade, many non profits which I visited with and helped in the evaluation process were focused on finding a long term software system which the organization would invest in (buy) and keep for years to come.

In this article, we review some of the reasons for software failure for your organization to be mindful about in your software selection process.

In the last decade, we have seen a very sustained trend towards the acquisition of cloud based solutions (subscription based systems). With that trend in mind, it is not uncommon for associations and nonprofits alike who selected a Software as a Service (SaaS, rented and hosted) to be looking again after less than 5 years of utilization. Suffice it to say, the trend is for organizations to seek a new solution much sooner than ever before.

Therefore, with the advent of SaaS we are seeing more Nonprofits (Associations, Museums, Foundations,etc.) switch more often (more so by smaller organizations) than ever before.

Knowing this trend, when I initially visit with new clients seeking a new CRM software system, my first few questions are:

  • Why bother with this project?

  • Why do you need it now?

  • Why do you believe it's not working?

With that knowledge in hand, I wanted to share some of the reasons I have discovered over the reasons which tend to be the tipping point for many organizations to drop kick what they have and embark on a new nonprofit software for there 501c3 or 501c6 organization.

Top 10 Reasons For Non Profit Software Failure

Here are some of the top responses we hear today:

  1. Product Features: We can’t do this or that.

  2. Software Ease of Use: The system is not user friendly.

  3. Product Reports: We can’t get data out in the reports we would like to use/see without costly consulting fees.

  4. Storage limits: Data limitations by the vendor.

  5. Software Not Flexible: We can’t integrate with other platforms like our LMS or Email marketing system.

  6. Not Customizable: We have to live in a box and can’t change to meet the growing needs of our organization.

  7. Organizatioin Strategy: Not a good fit for our direction and we have outgrown the system. There are certainly different tiers of solutions for different types of nonprofits (associations, museums, foundations, religious based, large vs. small etc.)

  8. Vendor Problems: Vendor merged or doesn't care about our needs.

  9. The Price of Software: Too expensive to maintain.

  10. Software Support Issues: We do not like treatment from a software perspective.

In some cases these issues above are very valid and legitimate reasons to find a new membership management software tool to help facilitate the mission of your organization.

Software Failure is Not Always Software Related

Assuming your nonprofit (Association or 501c3 nonprofit) has done the proper due diligence and selected a system that is appropriate for your organization, success or failure will likely depend on several primary non technology related items as well internally:

  • Poor Data practices (initial data migrations)

  • Poor Implementation (how the system was set up) is the often overlooked killer of software failure

  • Poor Documentation of business rules and system set up

  • No Ongoing commitment by organization to keep up to date with system or training of staff (new or veteran)

Ongoing Software Assessments May Help Avoid Switch Costs

Software sales vendors don’t bring this up very often. But, it’s a sad reality. A new software system may not be your issue at all.

With the growth in Cloud based SaaS systems, we are fearful that more people will drop kick their old systems without taking the proper assessment of the true issues impeding success with the incumbent technology. I admit that it is easy to get lured by the latest and greatest software features today (the new car smell of course).

We all love to see new features/technology, don't we all? And, it’s easier to point fingers and blame the technology, rather than the true diseases which have manifested over time into the death of the organizations software investment.

I truly take pride in helping clients with performing Strategic System Assessments to help identify the unique needs of the organization and determine the root of the problem before hastily switching tools.

Are you considering a change? If you would like a trusted partner who is impartial & studies the landscape of options to assist you in identifying your unique needs and requirements, please contact us for more information.

Until next time, keep SmartThoughts in mind.

Consulting for Nonprofit CRM



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