A One-Stop-Shop for Grants & Employee Engagement Isn’t What Corporate Philanthropy Needs

If you are watching the corporate grants and employee engagement world, you’ll see that there is some consolidation and merger of the corporate grants and employee engagement companies. In 2014 Blackbaud acquired Microedge. Late last year Benevity acquired Grantstream. Recently, Cybergrants acquired JK Group. There is an argument being made by many in the industry that corporate grants and employee engagement should be fully integrated and from one vendor. After all, that’s got to save costs and be good for the client and the end users, right?

At Versaic, we believe that forcing a client to work with one vendor for both corporate grants management and employee engagement is actually a disservice to the client. Except for the fact that both corporate grants and employee engagement deal with corporate giving, they are two very different systems that have very little in common beyond the desire for consolidated reporting on philanthropic activities and the impact of those activities. The client is best served by picking the best system for corporate grants management and the best system for employee engagement and integrating the reporting, as necessary, to meet reporting requirements, evaluate the impact of the philanthropy, and provide visibility into the giving programs.

Different Users, Different requirements.

To better substantiate this claim, let’s take a look at who is using the two respective systems and what the systems do. In the case of corporate grants, the client user is typically within a corporate foundation. They are managing decisions about grant requests being made by submitters external to the corporation. They are managing a corporate foundation budget that is specifically allocated to pay for the administration of the corporate foundation and to fund grants. Only the administrators within the corporate foundations and corporate executives that require operational visibility into the corporate philanthropic activities need to work with the corporate grants management system. The system is primarily a request management, workflow management, and reporting system.

In the case of employee engagement, every employee of a corporation may or should be a client user. The goal of an employee engagement system is to increase the engagement and enjoyment of the work environment of every employee in the company through shared charitable goals, better communication, and social media. Employee engagement systems can start with simple gift matching of charitable donations made by employees and can be expanded to handling areas such as volunteer tracking, providing a private social media network where employees share stories, tips, insights, and create a fun work environment, and improving communication between employees and executives.

Corporate grants management systems and employee engagement systems are really very different systems that only have one general thing in common: They both deal with corporate philanthropic activities. The different end users and use cases, in turn, result in dramatically different user experiences including where and how they interact with the system. Managing grants, foundation budgets, and impact reports are typically going to require greater interactivity with the underlying data and are done in an office setting. Submitting a matching gift request, logging volunteer hours, and interacting with social media are typically done in the moment, on-the-go.

Even further, configuring and supporting these systems is dramatically different. Again, because the end users and use cases are so dramatically different, the best practices and expertise in each field is very different. For your programs to be the best in both areas, you need the best expertise in both areas.

These conflicting requirements for the end user as well as the expert demand on implementation and support cause software vendors who provide both systems to make compromises. These compromises in turn stifle innovation in both areas as the development and support teams have to juggle competing priorities. It’s very much like a desktop productivity software maker trying to also make games for your phone. It’s possible, but you don’t get the best in either case.

The one area where combining systems makes sense is to have reporting visibility over both areas and the ability to assess the impact of the philanthropy in both areas. This reporting requirement can be easily handled by capturing the data you need from the two different systems and consolidating the data in a reporting system. Versaic’s advanced reporting technology can easily be used for this purpose, regardless of what employee engagement system you choose. As long as the employee engagement system has a way to export its data (and if it doesn’t you probably don’t want to use it for a number of other reasons), we can and probably already have integrated with it.

Market Observations.

There are also some other market factors at play. For one, employee engagement doesn't apply to private foundations. While that doesn't directly affect corporate clients, a software vendor that chooses to integrate is adding some level of complication that adversely affects what private foundations need. While they’re often treated separately, the private and corporate foundation markets are linked in some important ways. In recent years, there has been an increased focus on impact reporting and outcomes among private foundations. We’ve seen first-hand this trend and associated methodologies from private foundations emerge in our corporate clients like Starwood Hotels. We believe the complications of integrating employee engagement with a grants management system will add friction to the transfer of knowledge between the corporate and private foundation markets and further stifle innovation.

Some consolidation in the market is natural. Consider that the last Idealware Report, “A Consumers Guide to Grants Management Systems”, listed 28 grant solutions. But because the trend to unify grants and employee engagement systems is not based with the client’s best interest in mind, we believe it won't persist in the long run. The need for innovation will win out and we’re seeing early indications already. This year’s edition of that same report will omit Grantstream, which was acquired by Benevity.

We have also been honored by being selected as one of only five software providers invited, for the first time ever, to this year’s CECP Summit. Perhaps even more interesting is that we’re the only one of the five that focuses on grants management, the others offering a combined solution. Clearly, being a one-stop-shop is not a criterion to be a market leader.

If you are trying to decide between different corporate grants management and employee engagement systems with the best possible systems in each respective area, contact 877-712-9495 or info@versaic.com.

This article was originally published on The Versaic Blog.