Pledge Processing Slowly Going Electronic

September 1, 2001       Matthew Sinclair      

Out of the ashes of the United Way Information Network (UWIN), which failed to deliver an automated pledge-processing program, different approaches have arisen. Appropriately enough, Phoenix has become the hotbed for electronic fund processing and workplace giving online.

The Valley of the Sun United Way (VSUW) developed the software that spawned United-eWay.org – a new nonprofit made up of other United Ways that license the product, which can be tailored to each organization’s local needs.

Though VSUW utilized the software in some of its workplace campaigns last year, this fall will include the first campaigns with other United Ways. So far, 78 UWs – mostly the largest, Metro I organizations – have signed on to use United-eWay, at an average of 10 separate workplaces in their campaigns. “Each city is deploying it with selective accounts that need it or are suggesting they take a look at it,” said Brian Hassett, the VSUW president who formed United-eWay and serves as its secretary.

At its heart, United-eWay is a content management system, explained Merl Waschler, president of United-eWay.org. “eWay is just the vehicle that these various United Ways work together,” he said.

United-eWay, the software, is a Web-based utility that allows UWs and companies to design unique workplace giving sites for their UW campaigns. It is based on serving each United Way that participates and its donor’s needs, allowing each company the ability to tailor the product with full donor choice. There are no set-up costs or transaction fees.

United-eWay, the nonprofit, was created to hold title rights on the application and to manage the software’s development, enhancement, licensing and other related activities. United-eWay will also coordinate the relationship among the software developer, ISP, and the United Ways that participate.

Those United Ways can fall into two different membership categories. Class A members paid $20,000, have a seat on the executive committee giving them access to the application, and to contribute to its ongoing development and maintenance.

Class B members have a sliding scale with the Metro I organizations paying between $10,000 and $17,500, Metro IIs charged $5,000, Metro IIIs $2,000 and those smaller determined on a case-by-case basis. In addition, all the members are required to contribute $100 per month for hosting fees to maintain the e-pledge software application system.

VSUW contributed the system software to United-eWay.org., donating the software, which required $80,000 “to get off the ground,” Hassett said. Only one Metro II UW, Salt Lake City, which was an early supporter, sits on the executive committee.

That committee, with approximately 40 members, identified system enhancement needs and established the priorities of the enhancements, and established funding levels. Decisions are made based on a voting system weighted according to each partner’s financial contribution to United-eWay.org.

United-eWay isn’t as much about selling a product as it is trying to develop a partnership and pooling resources, according to Hassett. “It respects the local United Way’s back room,” he said. “It’s a way for the United Way to satisfy a donor’s and company’s need.”

Other UWs in the field have been trying to develop Internet approaches for pledge processing following the demise of UWIN. The Mile High United Way in Denver, for example, had spent $50,000 for a software program to process electronic pledges, which it then shared with other United Ways. In last year’s campaign it raised $380,000 via e-pledges out of its $32 million total, according to Stacy Taylor, communications manager.

“This year, we’re spending $20,000 and we’re opening it up to more companies,” she said, explaining that United-eWay will be run in 50 companies. “We want to make it easier for companies to run a campaign, and it helps in our costs in the pledge processing area.”

The United Way of Greater Toronto has developed a product similar to United-eWay. “United Way at Work” tested in 16 companies last year and will be use in 35 Toronto companies this year. The program will also pilot in four other Canadian cities, Vancouver, Winnipeg, Calgary and Edmonton, as well as in Boston and Philadelphia.

Philip King, a loaned executive from A.T. Kearney serving as UWGT’s vice president for e-business, said there are many similarities between United-eWay and United Way at Work. Other than United-eWay being deployed to more organizations, the main difference is “they have focused time and energy on the transaction capabilities. … We have focused on the interaction around that pledge.”

UWGT’s campaign last year raised approximately $1.5 million (Can.) out of its $70 million (Can.) campaign. King said he’s hopeful United Way at Work can process around $7.5 million, and given time he hopes it can increase at approximately 200 percent each year. “We’re intentionally being cautious,” he said. “There’s still so much we don’t know about how technology affects our workplaces.”

At Hassett’s UW, “we introduced it to firms with a culture of support. They’re pretty strong, they have a strong approach to the campaign,” he said, adding that the approach is not intended to do away with meetings and campaign events. He said the VSUW also tried to cultivate businesses where there wasn’t already a United Way campaign and it had nothing to lose. “We’ve made it easy to give. The education effort was there.”

Significant challenges still face electronic workplace campaigns, such as developing a database of all agencies and having unique identifier codes to facilitate the allocation of funds.

Hassett said he is working with the UWGT to develop a catalog of agencies in North America. “This could be the most important thing we could do together,” he said. “The IRS database is there, but it goes way beyond what we’re concerned about. … And sometimes the data is not as current as maybe we would hope.”

Also, VSUW is developing an application that allows partner agencies to apply through the Internet. “It also allows us to update our database,” he said. (It has a) customer management aspect, so there’s a way to communicate and respond to the donor. … It’s a logical step.”

King cautioned that such electronic systems also need to be monitored for efficiency. “We’re looking at a few things,” he said, “cost of raised funds, where does it increase costs, where does it reduce costs, is it an effective way of doing this, can we honestly say it increases (participation)?”

King said the key challenge in electronic workplace campaigns will not be the electronics but the work. “The technology is not what’s tough. The business practices are what’s tough,” he said. “What aspects of our business are good to centralize and what need to stay local? And how do we mix those two? … It’s a matter of agreeing on the schema and implementing it.”

While there’s still much to be developed and learned, Hassett said, the possibility exists that such a system could lead to more regionalization within the UW system. Hassett said that eWay members represent approximately $2 billion of the more than $3.7 billion raised through the UW system last year – though United-eWay will not process anywhere near that amount.

As the collaboration develops, it will need to define success. “I don’t know if we can identify one measure of success,” Waschler said. “Initially, it was the number of United Ways signed on. … Success (going forward) will be defined by campaign results and user satisfaction.” “

We want to make sure we can get the bugs out, scale it up in an appropriate fashion and still pursue these other avenues,” Hassett said. “The national database is critical right now. … I think more and more of the United Ways are starting to understand this model and this project.”

Ironically, UWIN’s failure, which contributed to the field’s unease with Betty Beene’s tenure as president of United Way of America and a growing level of mistrust within the UW system, could lead to a renaissance within the UW system. “I think technology has moved in a way that provides United Ways a unique opportunity to collaborate and build some real efficiencies,” said Waschler. “We’re at an interesting time.”