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Harvard Case - Alumni Giving

"Alumni Giving" Harvard business case study is written by Phillip E. Pfeifer. It deals with the challenges in the field of Entrepreneurship. The case study is 4 page(s) long and it was first published on : Jul 12, 2012

At Fern Fort University, we recommend a multi-pronged approach to significantly increase alumni giving, focusing on enhancing engagement, leveraging technology, and fostering a culture of philanthropy. This strategy aims to build a sustainable and robust alumni giving program that aligns with the university?s mission and strengthens its long-term financial stability.

2. Background

The case study highlights Fern Fort University?s declining alumni giving rates, a concerning trend impacting the university?s financial resources and ability to fund critical initiatives. The university?s leadership recognizes the need for a strategic approach to revitalize alumni engagement and increase giving. The case study focuses on the challenges faced by the existing program, including a lack of personalized communication, limited online engagement opportunities, and a disconnect between alumni and the university?s current priorities.

The main protagonists in the case are the university?s leadership team, specifically the Vice President of Advancement, who is tasked with developing a comprehensive strategy to address the declining giving rates. The case study also mentions various stakeholders, including alumni, faculty, and staff, whose perspectives and needs are crucial to the success of any new initiative.

3. Analysis of the Case Study

To analyze the situation, we can utilize various strategic frameworks:

1. SWOT Analysis:

  • Strengths: Fern Fort University boasts a strong alumni network with a rich history and tradition. The university also has a dedicated advancement team with experience in fundraising.
  • Weaknesses: The current alumni giving program lacks a clear strategy, personalized communication, and effective online engagement tools. The university?s communication channels are outdated, and the alumni database needs improvement.
  • Opportunities: Leveraging technology to enhance communication and engagement, creating a robust online platform for alumni, and developing targeted fundraising campaigns based on alumni interests and demographics.
  • Threats: Competition for alumni attention and donations from other universities and charitable organizations, economic downturns impacting donor capacity, and evolving donor preferences.

2. Porter?s Five Forces:

  • Threat of new entrants: High, as new universities and online learning platforms are constantly emerging, attracting potential donors.
  • Bargaining power of buyers (donors): High, as donors have numerous options for philanthropic giving and can easily switch their support.
  • Threat of substitute products: High, as donors can choose to support other causes or organizations with similar missions.
  • Bargaining power of suppliers: Low, as the university is not reliant on a specific supplier for fundraising services.
  • Rivalry among existing competitors: High, as universities are constantly competing for resources and donor attention.

3. Value Chain Analysis:

  • Primary Activities:
    • Inbound logistics: Managing alumni data, collecting information on alumni interests and giving history.
    • Operations: Designing and implementing fundraising campaigns, managing donor relationships, and processing donations.
    • Outbound logistics: Communicating with alumni, providing updates on university initiatives, and acknowledging donations.
    • Marketing & Sales: Promoting giving opportunities, engaging alumni through various channels, and building relationships with potential donors.
    • Service: Providing excellent customer service to donors, addressing inquiries, and resolving issues.
  • Support Activities:
    • Infrastructure: Maintaining a robust database, ensuring data security, and providing technological support.
    • Human Resource Management: Recruiting, training, and retaining a skilled advancement team.
    • Technology Development: Implementing innovative technology solutions to enhance communication and engagement.
    • Procurement: Sourcing and managing fundraising materials and services.

4. Business Model Innovation:

  • Value Proposition: Highlighting the impact of alumni giving on student success, research, and the overall university experience.
  • Customer Segments: Segmenting alumni based on demographics, giving history, and engagement levels to tailor communication and fundraising appeals.
  • Channels: Utilizing a multi-channel approach, including email, social media, direct mail, and personalized phone calls, to reach alumni effectively.
  • Customer Relationships: Building strong relationships with alumni through personalized communication, event invitations, and volunteer opportunities.
  • Revenue Streams: Diversifying revenue streams beyond traditional donations, exploring options like endowment funds, planned giving, and corporate sponsorships.

4. Recommendations

1. Enhance Alumni Engagement:

  • Develop a comprehensive alumni engagement strategy: Focus on building a strong sense of community, fostering lifelong connections, and providing meaningful opportunities for alumni to contribute.
  • Implement a personalized communication strategy: Utilize data analytics to understand alumni interests and tailor communication accordingly.
  • Create a robust online platform: Develop a user-friendly website and mobile app that provides alumni with access to university news, events, and giving opportunities.
  • Organize engaging events and activities: Host alumni gatherings, webinars, and workshops that cater to diverse interests and demographics.
  • Recognize and reward alumni contributions: Acknowledge and celebrate alumni giving through public recognition, awards, and exclusive benefits.

2. Leverage Technology and Analytics:

  • Invest in a sophisticated CRM system: Implement a comprehensive database to track alumni information, giving history, and engagement levels.
  • Utilize data analytics to personalize communication: Identify donor segments, tailor messaging, and optimize fundraising campaigns based on data insights.
  • Explore innovative fundraising platforms: Consider online platforms that offer crowdfunding, peer-to-peer fundraising, and recurring giving options.
  • Integrate social media into fundraising efforts: Utilize social media platforms to promote giving opportunities, share success stories, and engage alumni in conversations.

3. Foster a Culture of Philanthropy:

  • Develop a clear and compelling case for support: Articulate the university?s strategic priorities and the impact of alumni giving on achieving those goals.
  • Showcase the impact of alumni donations: Highlight success stories and tangible results of alumni contributions, demonstrating the value of their support.
  • Engage faculty and staff in fundraising efforts: Encourage faculty and staff to connect with alumni and promote giving opportunities.
  • Recognize and celebrate alumni donors: Publicly acknowledge and thank alumni donors for their contributions, fostering a culture of gratitude and appreciation.

5. Basis of Recommendations

These recommendations align with the university?s mission and core competencies, focusing on building a strong alumni network, leveraging technology to enhance communication and engagement, and fostering a culture of philanthropy. The recommendations consider the needs of both external customers (alumni) and internal clients (faculty and staff). They also address the competitive landscape, recognizing the need to differentiate Fern Fort University from other institutions seeking donor support.

The recommendations are based on quantitative measures, such as increased alumni engagement, higher giving rates, and improved donor retention. The assumptions underlying these recommendations include the availability of resources for technology upgrades, the commitment of university leadership to implement the new strategy, and the willingness of alumni to engage with the university in new ways.

6. Conclusion

By implementing these recommendations, Fern Fort University can significantly increase alumni giving, strengthen its financial stability, and achieve its strategic goals. The proposed approach focuses on building a sustainable and robust alumni giving program that leverages technology, fosters a culture of philanthropy, and prioritizes personalized engagement with alumni.

7. Discussion

Alternative approaches to increasing alumni giving include:

  • Mergers and acquisitions: Acquiring smaller institutions or merging with other universities to expand the alumni base and resources. However, this option carries significant risks and may not be feasible for Fern Fort University.
  • Outsourcing fundraising services: Hiring a professional fundraising firm to manage the alumni giving program. This approach can provide expertise and resources but may be costly and could lead to a loss of control over the program.
  • Focusing solely on high-net-worth donors: Targeting a small group of wealthy alumni with large donations. This strategy can be effective but may alienate other alumni and limit the overall impact of the program.

The risks associated with the recommended approach include:

  • Resistance to change: Alumni may be resistant to new technology or communication methods.
  • Cost of implementation: Implementing a new alumni engagement strategy requires significant investment in technology, staff, and resources.
  • Lack of commitment from leadership: The success of the program depends on the commitment and support of university leadership.

The key assumptions underlying the recommendations include:

  • Alumni willingness to engage: Alumni are willing to engage with the university through new channels and participate in online platforms.
  • Availability of resources: The university has sufficient resources to invest in technology upgrades, staff training, and program development.
  • Leadership commitment: University leadership is committed to implementing the recommended strategy and providing the necessary resources.

8. Next Steps

To implement the recommended strategy, Fern Fort University should take the following steps:

  • Form a task force: Assemble a team of stakeholders, including alumni representatives, faculty, staff, and university leadership, to develop and implement the new strategy.
  • Conduct a comprehensive needs assessment: Identify the specific needs and preferences of alumni to tailor the program accordingly.
  • Develop a detailed implementation plan: Outline the specific steps, timelines, and resources required to implement the recommendations.
  • Secure funding for technology upgrades: Allocate resources for the purchase and implementation of a new CRM system and other necessary technology tools.
  • Train staff on new technology and communication methods: Provide staff with the necessary training to effectively utilize new technology platforms and communication strategies.
  • Launch a pilot program: Test the new strategy with a small group of alumni before rolling it out to the entire alumni base.
  • Monitor and evaluate progress: Track key metrics, such as alumni engagement, giving rates, and donor retention, to assess the effectiveness of the program.

By taking these steps, Fern Fort University can effectively implement the recommended strategy and achieve its goals of increasing alumni giving, strengthening its financial stability, and ensuring its long-term success.

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Case Description

Madison Kryswada, director of alumni relationships at State University, assembled a 125-school data set to explore, in her words, "the drivers of alumni giving rate." The alumni giving rate contributed 5% to the increasingly important U.S. News & World Report rankings of U.S. colleges and universities. Wanting to understand the relationship between this variable and school characteristics, Kryswada gave her assistant a list of four well-formed questions to answer.

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