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Integrating the New Organization
Integrating the Fundraising Function
Fundraising integration includes combining all sources of contributed income while respecting donor restrictions. It also includes combining all donor databases, management systems, proposal writing processes, and case statements, and the development staff who use them to raise necessary funds. The groundwork for integrating the fundraising systems of merging organizations is laid during the due diligence process. The .nancial information exchanged by the negotiating parties at that point should include their grant histories and donor lists.
Envisioning the future
A well-integrated organization will have a fundraising function that clearly serves the mission, vision, and .nancial requirements of the new entity. Successful fundraising also depends on adept management of the relationships each partner has with its board members, donors, volunteers, staffs, vendors, and prospects. Fundraising integration is highly interwoven with marketing, communication, .nance, and technology integration. In all of these areas, the new organization has an opportunity to build on each partner’s strengths, tackle any de.ciencies, and leverage the relationships that each brings to the table.
Pre-merger steps to successful integration
Collect and share fundraising information from each merging organization during the due diligence process. A comparison of the organizations’ sources of funds and donor bases should be completed toward the end of negotiations.
After the boards approve the merger and the executive director and management team have been identi.ed, the fundraising leaders must immediately get to work. Include top fundraising staff on the integration team. These individuals should consult with others involved in fundraising at each of the merging organizations, as well as with staff responsible for technology, .nance, marketing, and communication, as needed. Those responsible for fundraising integration should review and analyze the current fundraising activities, practices, and systems at each merging organization, and make recommendations for integrating these in a way that will ensure the .nancial success of the new entity. Included in this review should be the following:
- Sources of income from each organization, including a three- to five-year trend analysis.
- Diversification of revenue streams: Is there too much reliance on one or two sources of income? Do the organizations excel in different areas of fundraising (for example, one receives many grants, the other has many loyal individual donors) and, if so, how will that expertise be leveraged by the combined organization?
- Donor databases: How much overlap, if any, is there between the organizations? Give particular attention to relationships with major individual donors, corporations, and foundations. If there is signi.cant overlap among these key contributors, it could be dif.cult to maintain current funding levels.
- Current commitments in planned giving, grants, and contracts: Are any steady sources of income scheduled or anticipated to stop in the near future?
- Participation from stakeholder groups in the fundraising efforts of each organization, including board members, volunteers, staff, vendors, community leaders, and others.
- Technology: What systems are in place to manage the fundraising function? How will the fundraising and .nance systems be linked? CHAPTER 13 Systems Integration 135
- Staffing: What structure and distribution of responsibilities will work best for the new organization?
- Office needs: What are the space and technology requirements of the fundraising function?
- Policies and procedures: What fundraising policies and procedures are established and practiced in the merging organizations? What will the new organization do?
- Marketing and communications: What coordination needs to happen between marketing, communications, and fundraising to position the new organization to raise the funds necessary for success?
- Case statements: Have a mission and vision been de.ned for the new organization? Can a case statement be prepared from these?
- Materials: From thank-you cards to brochures, what will you need and what will it cost?
- Budget: What are the resources necessary to successfully integrate the fundraising function and to position the organization for the growth needed to accomplish its mission and vision?
Post-merger steps to successful integration
The analysis described above—which may well continue into the post-merger phase— should result in a set of recommendations for integrating the fundraising activities, practices, and systems of the merging organizations. The integration team should review these recommendations, take into account the funding needs of the newly merged organization, and work with fundraising staff to develop a timeline for implementation. It is important to balance short-term and long-term needs as you move forward. It may seem crucial to solicit funds immediately to cover integration costs; on the other hand, it may be better to devote a month or two to re.ning the merged organization’s case statement and value proposition before approaching funders for large grants. The initial budget set early in the integration process should guide early fundraising planning. That budget will be re.ned over time, as additional integration needs are identi.ed and additional decisions about post-merger operations are made. As soon as possible, develop an initial one-year fundraising plan for the new entity. A strategic planning process undertaken during the .rst year of integration will drive future fundraising goals and strategies.
Challenges and roadblocks
Many of the challenges and roadblocks that arise in fundraising integration will stem from differing philosophical approaches to fundraising. One organization may steer clear of special events, for example, while another sees them as fun and a key strategy in raising funds. In addition, relationships between donors and staff can be special and cherished. It is often dif.cult to share those relationships, and trying to do so may jeopardize them.
There may be a signi.cant difference in the fundraising cultures of the merging organizations, such as expectations regarding contributions from board members or the level of participation from board members in fundraising efforts. It is very important to clarify those expectations—both to de.ne the role the board will have in fundraising, and to retain each board member’s commitment to performing that role.
There may also be challenges integrating the technology that supports the fundraising function. Converting databases is often time-consuming and costly, and may require hiring temporary contract staff. New technology also means retraining staff and providing tech support. Balancing the daily demands of their work with the demands of the integration process will be dif.cult for fundraising staff and development committee members. Note that many newer fundraising software packages are quite adept at automatically importing and converting data from different software systems. This feature can save much time and trouble.
Daily demands are not likely to lessen after the merger. To the contrary, many merged organizations .nd it quite challenging to “gear up” and raise the additional funds necessary to support both the merger process itself and the larger, more complex organization that is the likely result. As one post-merger executive director commented, “We used to have to come up with a million and a half bucks a year, and now we have to come up with four million a year. And it’s a lot harder. It means you’ve got to change the way you look at your income stream and the way you go after it.”
However you address these challenges and roadblocks, your approach should be grounded in the mission and vision of the new organization, and in a strong commitment to communication. It will be important for staff and volunteers to both understand and be open to new ideas as they work to create a successful new organization.
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