The Problem with Big CRMs

Nonprofits are at a critical juncture. They’re facing mounting pressure from funders to prove their outcomes, not just their activities. The 2023 Salesforce.org report states that 76% of nonprofits lack a robust data strategy, and this is no surprise given the glaring challenges posed by big CRM systems like Salesforce and Bonterra. While these platforms excel in managing donor pipelines and contact databases, their failure to address the nuanced, outcome-driven needs of nonprofits has led to a major disconnect between data collection and actionable impact measurement. Let's explore why these platforms are falling short and how agile alternatives, such as Sopact’s data hubs, offer a more sustainable, cost-effective path forward.

1. CRMs Were Never Built for Measuring Impact

Salesforce and other CRMs were designed with businesses in mind—sales pipelines, leads, and customer retention metrics. Their adaptation for nonprofits has largely focused on donation tracking and contact management but has failed to evolve for today’s complex impact reporting. Nonprofits deal with multifaceted data, from pre- and post-program outcomes to qualitative feedback, demographic diversity, and longitudinal tracking. CRMs struggle to unify and make sense of this data.

For example, organizations using CRMs often face the issue of siloed data. As highlighted in multiple nonprofit forums and case studies, staff frequently switch between Excel spreadsheets, CRMs, and other program-specific systems because the CRM cannot accommodate every data type or reporting requirementWhy CRM based system fo….

“CRMs are like trying to build a skyscraper with tools meant for a garden shed,” one frustrated nonprofit leader described. They weren’t built for the deep integration of impact measurement frameworks like the UN SDGs or IRIS+.

2. Customization: A Costly, Never-Ending Trap

CRMs require extensive customization to adapt to nonprofit workflows. A 2021 Forrester report found that over 60% of nonprofits implementing CRMs reported significant customization efforts, often leading to ballooning budgets and long timelinesWhy CRM based system fo…. For instance:

• A mid-sized education nonprofit spent over $150,000 in Salesforce customization, only to revert to Excel after the staff found the CRM too complex to manageWhy CRM based system fo….
• One nonprofit on Reddit revealed spending $100,000 on consultants, only to find they still couldn’t generate reports for their fundersImpact Measurement_ Fro….

This is not just a financial burden. It leads to staff burnout, adoption issues, and organizational frustration. When key employees leave, nonprofits are left with systems no one understands. As described in one case, an organization’s internal CRM champion left, causing chaos as remaining staff struggled to manage custom objects and data integrationsWhy CRM based system fo….

3. The Hidden Cost of Data Silos

Despite the promises of CRM vendors, many nonprofits face data silos that prevent them from having a holistic view of their programs. One example from a community health organization highlights this well: they tracked patient outreach in one system, volunteer engagement in spreadsheets, and vaccination outcomes in another. Merging this data for reports became a nightmare, delaying reports for funders and damaging stakeholder trustImpact Measurement_ Fro….

These silos often force nonprofits into endless cycles of importing and exporting data manually, leading to errors, outdated dashboards, and lost opportunities for real-time decisions.

4. Real-Time Impact Reporting Is Not Optional

Today’s funders demand real-time, outcome-focused data. The rise of outcome-focused funding means nonprofits need to show tangible results quickly, whether it’s job placements, educational advancements, or health improvements. Unfortunately, traditional CRMs fail in this regard due to slow data processing and manual reporting dependencies.

One nonprofit shared its struggle with Salesforce: their manual data processes meant reports took weeks, even months, to compile—too late for time-sensitive grant applications. Conversely, Sopact’s data hub solution enabled Talent Beyond Boundaries to generate immediate, real-time reports using automated pipelines, helping them prove refugee placement outcomes with precision.

5. The Alternative: Data Hubs for Agile Impact Measurement

Data hubs offer a radically different approach by acting as a central nervous system that connects all data sources without forcing everything into a single system. This eliminates the need for costly customization while allowing nonprofits to retain their existing tools (like Excel, program-specific software, or Google Sheets)Why CRM based system fo….

Key advantages of data hubs:

• Phased implementation: Unlike CRMs that require an all-or-nothing approach, data hubs can be integrated gradually, starting with the most critical data sources.
• Automation: Automated pipelines clean, transform, and unify data in real time, eliminating the need for manual imports/exports and reducing errors.
• Flexible reporting: Standardized outcome metrics, such as pre/post evaluations, allow for apples-to-apples comparisons across programs and time periodsImpact Measurement_ Fro….

For example, Sopact’s collaboration with Talent Beyond Boundaries enabled them to seamlessly integrate data from applicant tracking systems, forms, and program databases, creating real-time dashboards that cut reporting time significantly and improved organizational efficiencyImpact Measurement_ Fro….

6. Addressing Nonprofit-Specific Challenges

CRM vendors often overlook the nonprofit sector’s unique challenges, such as limited technical expertise and high staff turnover. Data hubs address this by providing:

• Low-code or no-code interfaces to enable staff to create dashboards and reports without technical knowledge.
• Continuous data refinement through automated feedback loops, ensuring that even inaccurate or incomplete data can be corrected iteratively.
• Stakeholder-centric planning: Mapping out data needs and aligning them with funder expectations is crucial to avoid wasted effort on irrelevant data pointsImpact Measurement_ Fro…Why CRM based system fo….

7. The Future Is Agile, Not Monolithic

The nonprofit sector is evolving toward agile, responsive data strategies that prioritize outcomes over inputs. This shift requires rethinking outdated CRM-based systems in favor of flexible architectures like data hubs. As Sopact’s experience shows, organizations that adopt this approach are better equipped to meet funder demands, engage stakeholders, and scale their impact.

The lesson is clear: instead of continuing to invest in CRM systems that were never built for the complexities of nonprofit impact measurement, organizations should embrace data hubs as the foundation of their data strategy.

Conclusion: Moving Beyond the CRM Trap

The question nonprofits must ask is no longer, "Can we customize Salesforce or Bonterra to meet our needs?" but rather, "Why are we forcing our processes into rigid systems in the first place?" By adopting data hubs, nonprofits can achieve:

• Faster, more reliable reporting.
• Reduced reliance on external consultants.
• Sustainable data practices that evolve with their programs.

It’s time to leave behind the limitations of big CRMs and embrace a future where data truly works for nonprofits, not against them. This is the path to unlocking sustainable, scalable impact.