This post reinforces to foundations and nonprofits the need for business continuity/disaster recovery planning and the necessary crisis communication plans so you can communicate with your donors and partners in times like these.
This has been quite a week for nonprofits around the country, including those who carry out their mission in Middle Tennessee where I live and work. It has also been a challenging one for community foundations that help support these nonprofits through funding support and connecting them with services. I can feel their pain seeing what happened with the recent ‘disaster’ they experienced with what was to be a national day of giving. You see, I work with nonprofits and companies to boost their organizational resilience and that includes anticipating, planning for and recovering from disasters.
The ‘disaster?’ A technology glitch with Give Local America, the national umbrella organization which over 54 city and regional campaigns were using for a national day of giving interrupted campaigns across the country. Give Local America is operated by Kimbia, an online fundraising platform.
Nonprofit and foundation staff have been preparing for months for Tuesday, May 3rd for what was billed as a national day of giving to raise much needed donations for the important work done by nonprofits. Foundation staff trained nonprofits and recruited sponsors; nonprofit staff redirected their time for targeted communications and videos and to prime the pump for donor giving. Good causes that have a national reach like The Elephant Sanctuary here in Tennessee to local causes like clean water and summer camps for homeless children in places like Nashville, San Antonio, and Seattle were affected.
I liken Tuesday to the Super Bowl when it came to its high profile giving opportunity. The national giving goal was projected to be over $100 million dollars! Last year over 9,000 nonprofits across 50 states participated, raising $68.5illion dollars. Here locally, the goal was to exceed last year’s total of $2.64 million, a substantial chunk of change. At the center of it all was Kimbia, the online fundraising tool, donors would use to support local organizations of their choice. The platform had different skins to make it appear to the donor that it was run by the local area community foundation. Here in Nashville, the Community Foundation of Middle Tennessee called it “The Big Payback.”
Things were going well at kickoff on Tuesday morning. The Community Foundation of Middle TN’s pace was well underway towards passing the $2.64 million raised last year. Then at approximately 9:00 am Kimbia began experiencing issues and donors were unable to make a financial gift for the organization(s) of their choice. This sent everybody into a confusing spiral: donors frustrated by not being able to give or to not know if their money went through; donors who thought the problem was with the nonprofit or the community foundation; nonprofit staff having to field communications with limited information coming from the 3rd party vendor. Most importantly, money that nonprofits had worked so hard to attract was only a trickle of what had been anticipated. Final tallies are still being compiled of the loss as some regions were able to resume scaled down campaigns later this week. Kimbia reports on its website that it was able to generate $29 million for nonprofits despite the technology glitch -- a far cry from its $100 million dollar goal. The Community Foundation of Middle Tennessee reports $1 million was raised with more being tallied but projections will be far less than the $2.6 million raised last year. In San Antonio, one of the largest sites, they were able to raise over $3,687 million of a $6 million dollar goal. If these totals are representative of national results among the 54 sites, nonprofits across the country will be far short of anticipated goals potentially by $50 million.
Tuesday - and in the days following - area community foundations have been in crisis management mode. Most of the participating regions made the decision to shut down the giving platform for fear of damaging their reputation with their donors because of Giving America’s inability to process funds. Here is what Kimbia reports posted on its website later in the day as to the problem:
At approximately 9 a.m. CDT, we began to see latency issues. The root cause of the issue now appears to be a hardware issue on one of our hosted database nodes which caused a cascading effect, impacting our ability to deliver forms and process donations that was further exacerbated by new functionality related to leaderboards, prizes and mobile applications.
Central in business continuity and disaster recovery planning -- planning that organizations undertake to be sure its key business processes can return to normal after an interruption) and have the means to recover in the event of a technology failure - whether it is in healthcare, financial services, or nonprofits are two concerns: what is the financial impact if a critical business function goes down and what is the impact upon my organization’s reputation. By those two accounts, Tuesday was a disaster. As a representative of a participating organization stated on the Kimbia web portal used for communicating during the crisis: “We have been trying to put a band aid on a bullet wound all day in order to earn the trust back from our supporters and donors. We’ve been chewed out by people under the assumption this website was operated by those in our agency. We have put hundreds of staffing hours, sleepless nights, and our most prized and delicate donor lists towards today, only to be cheated and disrespected.”
Even though Kimbia could restore some functionality and resume a scaled down service and area community foundations decided to extend the campaign for Thursday, a fraction of the dollars for critical programs was captured. Even more of a concern was donor trust in nonprofits and foundations and nonprofit leadership in foundations that partner with 3rd party vendors who promise to ‘streamline’ a service such as giving.
It is not my intention to pile on the good folks at Kimbia and their partners. This post reinforces to foundations and nonprofits the need for business continuity/disaster recovery planning and the necessary crisis communication plans so you can communicate with your donors and partners in times like these. What this week’s event highlights is the need for adequate due diligence in verifying that the companies or organizations we partner with to execute services have thorough plans to deliver services after an interruption. If you are a nonprofit leader or board member or an officer of a Community Foundation that participated in the Give Local America campaign, I share these tips of what you can do now and moving forward.
- Update your crisis communications plan. If you don’t have a written plan, create one.
Nonprofits and foundations need to have prepared and ready a crisis communications plan. The work was not done in the lead up to the launch of the national day of giving with the preparation of donor lists and marketing. I received communications from many nonprofits before Tuesday’s launch. But I didn’t receive one from any participating nonprofit (or foundation) once they experienced an interruption in service alerting us that there was a problem and informing me of the status. Most importantly, vendors providing services to clients need adequate crisis communications plans and to communicate timely so customers downstream can communicate. The service provider did a poor job in this area.
- For nonprofits and foundations that use 3rd party vendors for services, review the capability of your vendors to deliver services in the event of a business interruption.
Here are questions you should be asking and asking for documentation:
- Do they have a disaster recovery plan? Is it maintained?
- What is their capability to failover to an alternate system or location? What is their practice for monitoring?
- What is their testing policy? How extensive is it, what do they test, and how frequently?
Reviewing Kimbia’s posts during the business interruption it does not appear that they had the means to failover its data and applications to an alternate environment and be back up and running in a timely manner. Creating an “active/active” environment can be expensive, but given that Kimbia stood to capture anywhere from $3 million to $5 million based on the range of 2.99% to 6.00% transaction fee it was charging to the different regions of its $100 million dollar goal the dollars are there for such infrastructure, especially in light of the risks. That failure on the provider’s end, has customers downstream assessing the future. An officer and board member’s comment on the Kimbia website crystallizes how important it is to ask these questions and the impact on organizations when problems arise:
“For certain, the momentum of 3 years of growth is now lost. The “simple system” each non-profit advertised, in both prior years and this one, has failed, and the trust is now compromised. As an officer and board member of my non-profit, I must be willing to do three things: 1) explain what happened, 2) apologize for the inconvenience, and 3) recommend how to prevent any such re occurrence. For #3, one solution now under consideration is to not partner with any national or regional fundraising strategy, and do it ourselves, just as we did prior to three years ago. And why? because it’s obvious that the national and regional organizations do not know how to scope out their most important partner, let alone adequately test the systems.”
Nonprofits have realized that momentum for giving days has been growing in recent years, and they have invested significant resources and staff time seeking to adapt to these trends. No doubt they feel a certain pressure if they don’t by the donor or that they may be missing out on needed donations from individuals. As foundations bring the 3rd party service to the nonprofit and the community of donors, it is important for foundations to take responsibility getting thorough answers and documentation as part of their due diligence of providers.
- Develop a business continuity or contingency plan for your organization.
Your nonprofit or foundation is not immune from disasters large or small. No matter your size nor your mission, your organization needs a contingency plan.
If you are interested in resources and how you can move forward on any of these suggestions, we can help you get started. Here’s a link to an online document library of resources Patmos prepared for the Nashville Area Chamber of Commerce and its member organizations to help them with disaster preparedness. And here is my email address (email@example.com) if you have a question or we can be of assistance.