Improving the service quality of donor care with monthly donors a study of the non profit organization in ho chi minh city, vietnam

UNIVERSITY OF ECONOMICS HO CHI MINH CITYInternational School of Business ---NGUYEN VO TRUC GIANG IMPROVING THE SERVICE QUALITY OF DONOR CARE WITH MONTHLY DONORS A STUDY OF THE NON-P

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-NGUYEN VO TRUC GIANG

IMPROVING THE SERVICE QUALITY OF DONOR CARE WITH

MONTHLY DONORS

A STUDY OF THE NON-PROFIT ORGANIZATION IN HO CHI MINH CITY,

VIETNAM

MASTER OF BUSINESS ADMINISTRATION

Ho Chi Minh City – Year 2021

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-NGUYEN VO TRUC GIANG

IMPROVING THE SERVICE QUALITY OF DONOR CARE WITH

MONTHLY DONORS

A STUDY OF THE NON-PROFIT ORGANIZATION IN HO CHI MINH CITY,

VIETNAM

MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: NGUYEN THI MAI TRANG

Ho Chi Minh City – Year 2021

TABLE OF CONTENTS

LIST OF FIGURES 5

LIST OF TABLES 6

ABBREVIATION 7

ACKNOWLEDGEMENT 8

EXECUTIVE SUMMARY 9

I PROBLEM IDENTIFICATION 10

1 Problem context 10

1.1 ABC Vietnam Organization overview (referred to as ABC Vietnam) 10

1.2 Communications and Fund Development department 10

a Digital Marketing and Communications team 11

b Corporate Partnership team 11

c Face to Face fundraising team: 11

d Tele-fundraising team 11

e Donor care team 12

1.3 Problem overview: 12

2 Symptoms 14

3 Potential Problems Identification 17

3.1 Problem definition 17

3.2 Potential problems 18

3.2.1 Potential problem 1: Lack of income 18

3.2.2 Potential problem 2: The Poor Service Quality of Donor Care 20

4 Main problem validation 24

5 Potential causes 25

5.1 Potential cause 1: Lack of understanding of monthly donor insights 25

5.2 Potential cause 2: Lack of Communications 26

5.3 Potential cause 3: Manual Database Management 27

6 Main cause validation 29

II ALTERNATIVE SOLUTIONS 30

1 Donor Database management system component: 31

2 Donor database management system purpose 32

3 Alternative Solutions 32

3.1 Alternative solution 1: Cloud database management system 33

3.2 Alternative solution 2: Hard drive database management system 34

4 Solution selection 34

5 Action Plan in Organization 37

III SUPPORTING INFORMATION 38

1 Methodology 38

2 Interview guide 38

REFERENCES 40

APPENDIX A: Transcript of in-depth interview (Phase 1) 43

APPENDIX B: Transcript of in-depth interview (Phase 2) 53

APPENDIX C: Transcript of in-depth interview (Phase 3) 57

APPENDIX D: Welcome and thank you email template 58

APPENDIX E: Questionnaires for choosing alternative solutions at ABC Vietnam 59

LIST OF FIGURES

Figure 1: ABC Vietnam Organization Structure

Figure 2: The structure of Communications and Fund Development department

Figure 3: DD Cancellations Feb-Apr 2019 & 2020, the report of Woods Valldata about the impact of Covid-19 on individual giving

Figure 4: DD Cancellations Rate Jan – Sept 2018, 2019 & 2020, the update report's May

2020 of Rapidata

Figure 5: The percentage of the Donor Retention

Figure 6: The percentage of the attrition rate of the monthly donors

Figure 7: The donor journey

Figure 8: The preliminary cause and effect map for problem solving at ABC Vietnam Figure 9: The secondary cause-effect smap for problem solving at ABC Vietnam

Table 5: Different alternative solution based on online – offline DDMS choice

Table 6: The advantage and disadvantage of AS #1 versus AS #2

Table 7: Quantitative result for problem solving of ABC Vietnam

Table 8: Action plan for Alternative Solution #1 in the last six months of the year 2021 Table 9: Qualitative Phase 1 – Initial Understanding, Symptom and Problem Deep Dive Table 10: Qualitative Phase 2 – Causes Deep Dive

Table 11: Qualitative Phase 3 – Solution Development

ABBREVIATION

CFD Communications and Fund Development

DDMS Donor Database Management System

HR & OD Human Resource and Organizational Development

ICT Information Communication Technology

IPS Internet Service Provider

ACKNOWLEDGEMENT

First, I express heartfelt gratitude to Associate Professor Mai Trang for her immense support

to carry out this thesis; my attempt at any level cannot be satisfactorily completing without the support and guidance of my Supervisor

Secondly, I am much thankful to Mr Thien, Mr Hung and Ms Thu for providing me a good condition to accomplish the thesis

Thirdly, I am truly grateful that ISB has granted me an amazing opportunity to apply all of the knowledge that I have acquired at school to solve a real-world problem This experience,

by no doubt, has established a solid foundation for me in my career journey ahead

Finally, I am greatly thankful to my beloved family and friends, especially my great half for the relentless support that they had given me to reach our goals Thanks to them, I was

motivated not to give up on difficulties and completed this thesis with the highest quality

Yours truly,

Nguyen Vo Truc Giang

EXECUTIVE SUMMARY

ABC Vietnam is a non-profit and non-government organization belonging to an international organization that aims to support children and young people to grow up in a safe family environment, get a good education, and be able to self-reliance employability by mobilizing the caring power of the communities in Vietnam and around the world to accomplish the mission of ABC Vietnam

ABC International set a goal for ABC Vietnam to raise a local fund of five million euros in

2025 and this goal is assigning to the CFD department of ABC Vietnam However, there is

a negative symptom that a high attrition rate of the monthly donors that affected to the goal

of the CFD department In addition, different literature reviews are used and in-depth interviews with managers and employees in the CFD department are conducting so that the current situation and problems fully comprehends at the department Thus, the findings show that the poor service quality of donor care of ABC Vietnam and lack of income due to the Effect of the Covid-19 pandemic were the potential problems of the symptom of ABC Vietnam However, the Effect of the Covid-19 pandemic is out of the scope of this project because it depends on the Covid-19 situation and no one knows when it is gone so this thesis just focuses on the main problem that is the poor service quality of donor care to solve

After the main problem, which is the poor service quality of donor care, ABC Vietnam has been determined; the main causes are also discovering based on the combination of literature reviews and in-depth interviews Then, proposed alternative solutions related to its problem are developing to solve the main problem At the end, Alternative Solution #1 was selecting

to develop a detailed implementation plan

I PROBLEM IDENTIFICATION

1 Problem context

1.1 ABC Vietnam Organization overview (referred to as ABC Vietnam)

ABC Vietnam (ABC is disguised the organization name) is a non-profit and non-government organization belonging to an international organization that has been established for 25 years ABC Vietnam aims to support children and young people to grow up in a safe family environment, get a good education, and be able to self-reliance employability

ABC Vietnam bases in Ho Chi Minh City, which has departments such as Finance and Controlling, Human Resource and Organizational Development, Program Development, Information Communication Technology, Construction, Administration, and Communications and Fund Development

Vision: Aim to create a better future for disadvantaged children and young people

Mission: Build a safe environment for children and young people in need, help them shape

their own futures, and be self-reliant in the future

The core value: commitment, trust, transparency and accountability

Figure 1: ABC Vietnam Organization Structure

(Source: ABC Vietnam Internal Structure)

1.2 Communications and Fund Development department

The main responsibility of the CFD department is to build awareness about ABC Vietnam

to the audiences and raise local funds as per the agreed targets from individuals, organizations and corporations to help ABC Vietnam to achieve five million Euros in 2025

Chief Executive Officer

Finance and

Controlling HR & OD

Program Development ICT Construction Administration

Communications and Fund Development CEO Assistant

The CFD department has 01 Functional Director, 05 teams and 01 General Affair person Each team will be responsible for different KPIs For example:

a Digital Marketing and Communications team

 Communications will manage internal and external communication, media relations, raise awareness about Children’s Right and ABC’s brand in Vietnam Moreover, Communications is also in charge of crisis communications to ensure coverage of the identified issues in the targeted media channels

 Digital fundraising has to innovate & explore new possibilities in digital fundraising in Vietnam; drive, initiate and coordinate fundraising campaigns

b Corporate Partnership team

 This team is responsible for building relationships with Corporates sector or High Net worth Individuals To analyze their needs and expectations and their relevance to the organization; develop and implement a strategic partnerships engagement and communications plan; contribute to the development of communications material for the above target audience so as to raise much needed funds for the mission of the organization

c Face to Face fundraising team:

 The main responsibility is to raise regular giving from individuals The team has to recruit new fundraisers, train and manage field based team members Set and monitor the performance as per identified targets Secure the venues where donor’s recruitment will take place e.g., malls, shopping complexes, office buildings and other public areas

d Tele-fundraising team

 This team will be responsible for acquiring new regular giving for the organization by calling prospective donors each day Coach, manage, train, and motivate member in the team to exceed their financial and non-financial KPIs ∙ Develop more leaders so that the organization can continue the growth

e Donor care team

 The main responsibility is to interact with donors via phone, email, and social media to provide and process information in response to inquiries, concerns and requests about ABC Vietnam services

 Retention of donors by donor Appropriately record and bank all money collected in the fundraising campaigns Update the public donation list on the website Monthly crosscheck with an accountant who in charge of finance and controlling of Communications and Fund Development department about the number of existing and new donors and their donation amount Suggest the ideas to improve Donor Care procedures and practices to maintain the donor as per target

Figure 2: The structure of Communications and Fund Development department

(Source: ABC Vietnam Internal Structure)

1.3 Problem overview:

Monthly donors provide the non-profit organization with a stable source of donation amount through small monthly donations that add up to a sizable annual total Monthly giving has retained donors, serving as the foundation of the organization’s success Their loyalty provides a predictable and reliable revenue stream that helps the organization operate as its mission, vision, and goal have set

According to (1) have shown that monthly donors are more likely to continue to give year over year However, in 2020, the first wave of Covid-19 shocked and affected many people

in Vietnam and around the world in general An unprecedented situation for all, amidst the challenges to finance, health, freedom, and fundraising of movement it presented According

to the report of Woods Valldata about the impact of Covid-19 on individual giving, the number of regular giving cancellations in 2020 was higher in Feb and March in 2019 (2)

Figure 3: DD Cancellations Feb-Apr 2019 & 2020, the report of Woods Valldata about the impact of Covid-19 on individual giving

Moreover, in the update report's May 2020 of Rapidata they revealed that the Direct Debit regular giving cancellations had seen an initial high jump during the first month of lockdown, before quickly dropping back to the usual level in April However, if we compare the attrition rate of 2020 with 2019 and 2018 we can see that the cancellation rates in 2020 have been well below the summer rates of both the two previous years (3)

Figure 4: DD Cancellations Rate Jan – Sept 2018, 2019 & 2020, the update report's May 2020 of Rapidata

Besides, customer service is building into the for-profit sector Businesses have one main party to please: the customer Nevertheless, it gets a little complicated for nonprofit organizations While they exist to meet the needs of their beneficiaries, they also have to cultivate strong relationships with the donors who fund their programs Many organizations continue to struggle with the latter, resulting in donor attrition On the donor side, it is critical that non-profits operate to make giving convenient, easy, and even enjoyable since they cannot rely on providing the contributor with a direct and immediate product or service It

is also important to understand what drives those that contribute i.e donor wants and expectations, since meeting those will be essential for retaining contributors On the other hand, the role of the quality of service offered to the donor in enhancing retention is also highlighting, as are donor perceptions of the feedback they receive and the impact they believe their gift might have on the cause (4)

2 Symptoms

ABC Vietnam wanted to invest in fundraising so that the organization can raise five million Euros to support the beneficiaries in Vietnam in 2025 The donors of ABC Vietnam are individuals, corporates, and organizations and ABC Vietnam divides donors into 2 types: one-time donors and regular donors The one-time donors are corporates, organizations, and individuals that do not commit to give long-term support While the regular donors who are

individuals commit support from 2-3 years or longer for ABC Vietnam, among the regular donors there are yearly donors and monthly donors The average donation amount of yearly donors is 200 Euros per year while the average donation amount of monthly donors is 20 Euros per month Besides, the average period donation of yearly donors is 2 years but the average period donation of monthly donors is 3 years and 6 months One more important thing is that ABC Vietnam has more than 12,000 regular donors while the monthly donors contribute about 60-70% income of ABC Vietnam every year

However, there are some problems in the service quality of donor care with monthly donors, which may affect the goal of the organization in the future Based on interview outcomes with monthly donors of ABC Vietnam, employees in the Communications and Fund Development department at ABC Vietnam and analysis from internal secondary data, there has been an alarming fact that signals a high attrition rate of the monthly donors of ABC Vietnam

In 2018, the number of monthly donors of ABC Vietnam at the beginning of the year 2018 was 1550 monthly donors; the Communications and Fund Development department recruited 2850 new monthly donors so the total of monthly donors in 2018 was 4400, among that there were 924 monthly donors who stopped donating in 2018 Because of this, the number of monthly donors of ABC Vietnam at the beginning of the year 2019 was 3476 and the Communications and Fund Development department recruited 4559 new monthly donors so the total of monthly donors in 2019 was 8035 but 1974 monthly donors stopped the donation at the end of the year In 2020, the CFD department recruited 6853 new monthly donors but at the end of the year 2020 there were 4000 monthly donors who stopped donating

Table 1: Number of new monthly donors and number of monthly donors cancelled from 2018-2020

No of Active monthly donors present at end

of the period

No of monthly donors cancelled during the period

The percentage of active the monthly donors at end

of the period

(Source: Internal data from ABC Vietnam)

Moreover, in The Non-Profit Recurring Giving Benchmark Study, monthly giving/recurring donors have a retention rate of 90% They are the most valuable donors and they are vital to the long-term sustainable growth of the organization (1)

Figure 5: The percentage of the Donor Retention

(Source: The Non-Profit Recurring Giving Benchmark Study)

Based on Table 1, we can see that the percentage of attrition rate of the monthly donors of ABC Vietnam was high from 2018 – 2020, especially in 2020 Moreover, according to (5) shows that the high attrition rate of monthly donors affects the goal of ABC Vietnam that will raise five million Euros in 2025

Figure 6: The percentage of the attrition rate of monthly donors

(Source: Internal data from ABC Vietnam)

3 Potential Problems Identification

3.1 Problem definition

According to (6) the position for non-profit organization is further complicated because it is probable that both donor service quality and the perceived quality of service delivered to the beneficiary group may be at issue that the donors stopped donating for the organization There are some arguments showed that maybe donors are in fact purchasing both services

As in the previous sessions, we know that ABC Vietnam is non-profit organization, its operation based on the donations from donors and the organization supports children and youths in need That means ABC Vietnam has two kind of services: the first one is to deliver support to the beneficiaries and the second one is to serve the donors

Based on an in-depth interview with Mr Minh – Communications and Fund Development Director, he shared that the target of recruiting new donors in 2018 - 2020 was always achieving well by Face-to-Face Fundraising team and Tele-fundraising team However, the target of retention of monthly donors did not meet as the expectation of the organization Therefore, to understand clearly the reason why the monthly donors have made decision to donate for ABC Vietnam and committed to donate for a long time Through an in-depth interview with Mr Toan, Face-to-Face Fundraising and Ms Tu – Tele-fundraising Team

Leader, both of them agreed that the reasons the monthly donor decided to donate for ABC Vietnam Firstly, ABC Vietnam has a good brand in Vietnam; ABC Vietnam also has been operating in Vietnam for 25 years so they trust in ABC Vietnam and the service that ABC Vietnam delivers to the beneficiaries Secondly, ABC Vietnam is supporting for orphans, abandoned and disadvantaged children who have lost the parental care or lack of parental care so the monthly donors empathize with them so the monthly donors wanted to help them

Hence, based on the sharing from Mr Toan and Ms Tu, we can see that the monthly donors have the perceived service quality of ABC Vietnam delivered to the beneficiaries, which means the service quality that ABC Vietnam delivers to the beneficiaries is good and satisfy monthly donors This is the reason why they made decision to donate for ABC Vietnam

On the other hand, Table 1 showed the growth of new monthly donors was increasing every year but the growth of monthly donors who canceled was higher than the growth of new monthly donor every year Therefore, a question has been arisen as to why the monthly donors cancelled donations afterwards What made they do not commit to donate longer for ABC Vietnam? Hence, by combining relevant literature with both primary and secondary data collected at ABC organization, the potential problems causing the symptom of the high attrition rate of the monthly donors are designing as below

3.2 Potential problems

3.2.1 Potential problem 1: Lack of income

In Table 1, if we compare the number of monthly donors cancelled between the periods of 2019-2020 with the period of 2018-2019, we can see that the number of monthly donors cancelled in the period 2019 – 2020 was higher 6% than the period of 2018-2019 As (5) also finds that a charitable giving in the first quarter of 2020 declined 6% on a year-over-year basis Besides, conducted by the Association of Fundraising Professionals and the Center on Nonprofits and Philanthropy at the Urban Institute, the analysis of sample data from nearly 250 nonprofits in AFP's Growth in Giving Database found that after a positive January and February dropped 11 percent in March compared to the same period in 2019

Additionally, Ms Elizabeth Boris, Growth in Giving Steering Committee chair said that the first two months of the year 2020 started out strong but in March alone, they saw an 11% decline in donations, which was almost certainly a reflection of the impact of COVID-19 (7)

On the other hand, based on the knowledge obtained in an in-depth interview with Ms Thu – Head of Donor Care team that the attrition rate of monthly donor’s expectation of the organization is 10 – 15% but the attrition rate was higher than the expectation of the organization in 2018 and 2019 The situation is worse in 2020 because of the effects of the Covid-19 pandemic; the attrition rate of 2020 was 31% The highest reason was giving by monthly donors that they were losing their job so they did not have enough money to donate; others were lack of income due to Covid-19 so they want to save money for the family

Table 2: Number of cancelled monthly donors who gave announcement and reason in 2020 and Q1/2021

Reason to cancel Number of cancelled monthly donors

(Source: Internal data of ABC Vietnam)

According to the General Statistics Office of Vietnam, in the first 6 months of 2020, there were 897.5 thousand people losing jobs while the number of unemployed people was at 1.3 million, an increase of 123.9 thousand, making the unemployment rate reaching the highest point in 10 years (8) Thus, lack of income due to the effects of Covid-19 pandemic was the reason leading the monthly donors to stop donating for ABC Vietnam

In Covid-19 pandemic, Vietnam faces challenges for the businesses as well as workers in the process of adapting to the new economic model Generally, the business market suffered

heavy losses due to the crisis, which led to an inordinate increase in the unemployment rate Because this situation belongs to the market outside the organization so this project will not focus on lack of income of monthly donors by the effect of the Covid-19 pandemic

3.2.2 Potential problem 2: The Poor Service Quality of Donor Care

It is obvious that customers/donors are one of the important stakeholders in organizations because they contribute finance through buying/using the products/services or donating for its operation so their satisfaction is a priority to the organization Customer/donor satisfaction has been a subject of great interest to organizations and researchers alike In recent years, organizations usually add on more service to their offers so that they can satisfy the customer/donor Thus, the quality of service has become an aspect of customer/donor satisfaction Some researchers have proven that service quality is related to customer satisfaction as (6) the context of fundraising donor satisfaction with the quality of the service that they are been provided with would drive subsequent loyalty

Hence, to be better understand ABC Vietnam's donor care process, the author took an depth interview with Ms Thu She shared the donor care processof ABC Vietnam to care for donors that when a donor has been recruiting and already transferred the donation amount

in-to ABC Vietnam’s bank account, Donor Care person will send a welcome and thank you email to the donor with 1-2 working days After that, they will send thank you gift to the donor via post office and if the donor does not transfer money in the 2nd month, they will send a reminder email They spend a lot of time in collecting materials to make annual reports for donors because there are 6,0000 reports needed to send to more than 12,000 monthly donors who are living around Vietnam In every Lunar New year, they send Lunar New Year card to donors via post office The donor care process is been shown in Figure 7 below:

Welcome and thank you

Figure 7: The donor care process of ABC Vietnam

(Source: Internal information from ABC Vietnam)

Based on Figure 7, we can see that ABC Vietnam cares for all donors as the same and APPENDIX D, page 56 that was sharing by the CFD department, shows that the body content of the welcome and thank you email to donors is very simple and only changed some basic information for every month The email content even is not separately for any specific kind of donor That is completely not good for the donor care service because based on (9) it’s a good practice to put monthly donors into a separate email list to keep them from being placed on the general email (including one-time donors and monthly donors) list where they are consistently sent appeals for donations even though they’re already giving In addition, the organization should send a personalized thank you letter (10) Ms Hoa, a major monthly

donor of ABC Vietnam also complained, “I do not know why ABC sends me the email with the same content every month Although I do not need to open the email, I know what email

is about so I asked the Donor Care person not to send email to me anymore I also stopped donating after 3 months because I am unhappy with the service of ABC Vietnam” [APPENDIX A, page 49]

On the other hand, (11) showed that responsiveness, reliability and empathy were

significantly relating to service quality and service quality was significantly relating to customer satisfaction Indeed, the acknowledgement gained from in-depth interview with

Mr Minh and two major monthly donors that further clarify on what has studied on (11)

Mr Minh – CFD Director shared that there were many monthly donors who wanted to get more update about beneficiaries like quarterly or biannually instead of annually The update about the changes of children or youths (based on Children Law of Vietnam, Mr Minh cannot share in detail of the content of report/update about children/youths) that monthly donors are supporting so they want to know the changes of beneficiaries so that they know, their donation has used for beneficiaries However, Donor Care team can’t give what monthly donors wanted that made few monthly donors stopped donating because they don’t know how their money being used In another in-depth interview with Mrs Khanh, the major monthly donor in Ho Chi Minh city who stopped donating for ABC Vietnam from January

2021 She told “I was asking the donor care person to send me more information about beneficiaries but after 2 months, I still didn’t get it so I stopped donating for ABC Vietnam because that made me doubt about the reliability of my donation’s the use in ABC Vietnam” [APPENDIX A, page 50]

Moreover, in an in-depth interview with Mr Hung, the major monthly donor in Ho Chi Minh

City, he said, “I want to get more information about the beneficiaries that I am supporting,

it is no need for a report but an update Although I have asked twice, the Donor Care person did not give it to me I called her to request but she said she is sorry that she cannot send it

to me due to lack of time and HR capacity However, I can’t empathize and accept that so I stopped donating” [APPENDIX A, page 51]

Besides, Donor Care team could not send birthday card to donors even it is an e-birthday card because they are managing the donor database by Excel so they don’t have a system to remind the donor’s birthday It is impossible for them to remember the monthly donor’s birthday by them self According to (12), a birthday card is special and sending a birthday card on the monthly donor’s birthday that could work well for this group Besides, in the

survey that CFD department made in December 2020 showed that 25% wants to receive birthday card or greeting card made by children for holidays, New Year or their birthday while 45% think that e-card is also fine with them However, the Donor Care team does not have enough time, HR and technical capacity to produce the products as the monthly donors required In an in-depth interview with Ms Thao, the monthly donors who has donated for ABC Vietnam for 01 year also shared

“I like to get birthday/Lunar New Year card made by children that I am supporting When I receive them, I feel happy then I will share it on ABC Vietnam Sponsor Group on Facebook but I have not gotten any birthday card from ABC Vietnam I am disappointed about that so

I stopped donating after 01 year” [APPENDIX A, page 52]

On the other hand, Table 1 shows that although 4,000 monthly donors canceled the donation

in 2020, there were only 116 monthly donors who gave an announcement as in Table 3 but Donor Care team did not contact them for the reason In an in-depth interview with Ms Thu, she shared that

“Based on our observation, perhaps because of ego and ethics, many monthly donors stopped donating without announcement to us We think they are afraid to tell because it is not good or unethical to stop sponsoring for children in need Some may forget to continue

to donate but we didn't call them to remind them” [APPENDIX A, page 46]

Furthermore, based on (13), (14), it is now well established that satisfaction has a strong positive effect on loyalty intentions in a wide variety of product and service contexts Satisfaction is viewing as the consequence of comparison between expectations and overall evaluations of delivered service quality (15)

In conclusion, with the information shared via in-depth interviews from ABC Vietnam's internal management (Mr Minh and Ms Thu) and external major monthly donors who committed to donate for 5 years, monthly donors who committed to donate for more than 1 year (Mrs Khanh, Ms Hoa, Mr Hung, and Ms Thao) along with the result of the survey

To be adding by literature (6), (11), (13), (14) and (15) the poor service quality of donor care

made monthly donor dissatisfaction that has significantly influenced the high attrition rate

of the monthly donors Based on all of the aforementioned, this thesis has identified the potential problems of the symptom that are: lack of income of monthly donors due to the effect of the Covid-19 pandemic and the poor service quality of donor care made the monthly donor dissatisfaction that leads monthly donors to decide to stop donating for the beneficiaries of ABC Vietnam Figure 7 below illustrates the preliminary cause-effect map

of the symptom and the potential problems

High attrition rate of monthly donors

The Poor

Service Quality

of Donor Care

Monthly donors dissatisfaction

Figure 8: The preliminary cause and effect map for problem solving at ABC Vietnam

4 Main problem validation

Like the previous section, all the potential problems have been validated based on the combination between interviews, data and be analyzed in the literature Based on the literature, the preliminary cause and effect map shows the high attrition rate of the monthly donors related to the poor service quality of donor care of ABC Vietnam and lack of income due to the Effect of the Covid-19 pandemic While the Effect of the Covid-19 pandemic is out of the scope of this project because it depends on the Covid-19 situation and no one knows when it is gone Besides, the in-depth interviews with monthly donors in the previous session shows that ABC Vietnam needs to improve the service quality of donor care to care for monthly donors Because the poor service quality of donor care made the monthly donor dissatisfied so they stopped donating for ABC Vietnam Thus, that leads to ABC Vietnam

will not be able to reach the goal as ABC International set and ABC will not have enough fund to support for the beneficiaries in Vietnam as well Moreover, the CEO and CFD Director of ABC Vietnam also agreed that the poor service quality of donor care is the main problem that leads to the high attrition rate of the monthly donors

5 Potential causes

A problem will not stop existing unless its root causes are identifying and properly handled Therefore, a review of relevant literature shall be executed beforehand to provide a framework for the determination of potential causes triggering the problem at ABC Vietnam After that, primary data obtained at the organization will be utilizing to analyze these causes

There are many kinds of research and journal about factors affecting the service quality of the non-profit organization (6), (10) Indeed, although there are many best practices and case studies such as Managing Relations with Donors Using the CRM concept, Fundraising Management: Analysis, Planning and Practice but these practices concentrating on many stakeholders and factors complicated might not relate to the problem of this thesis Therefore, to match the context and scope of this thesis, an integrated model was developing

by combining appropriate factors Managing Relations with Donors Using the CRM concept and Fundraising Management: Analysis, Planning and Practice Based on this approach, the poor service quality of donor care problem faced by ABC Vietnam can be explaining by

three potential causes that are (1) lack of understanding of monthly donor insights, (2) lack

of communications and (3) manual data management

5.1 Potential cause 1: Lack of understanding of monthly donor insights

As we can see the donor journey in Figure 5, CFD department care all of donors as the same, either one-time donors or regular donors Because of lack of donor segmentation that made the Donor Care team does not understand monthly donor insights why they donate to ABC

Vietnam As Ms Thu – Head of Donor Care team shared in the in-depth interview: “ABC Vietnam does not segment monthly donors by age, donation amount, donation period or sexuality to care When we receive the donation, if we have the donor’s email we will send

a thank you email to them with the same template for every donor, we only change the donor name, donation amount, donation period and the beneficiary name.” [APPENDIX B, page 53]

On the other hand, based on the Donor Loyalty Study of Abila mentioned that the three main reasons people donate to nonprofit organizations are very personal in nature – they have a deep passion for the cause, they believe the organization depends on their donation, or they know someone affected by the nonprofit’s mission (16) Besides, behavioral or transactional segmentations are often the most practical and beneficial solution for all charities, large and small, to understand the behavior of their donors (17)

Therefore, based on Figure 5, in-depth interview and literature (16), (17) there is a sub-cause that is lack of donor segmentation leading to lack of understanding of monthly donor behavior This is the cause of the poor service quality of donor care problem

5.2 Potential cause 2: Lack of Communications

Based on the data of staff increase compared with the donor increase was shared by Ms Thu – Head of Donor Care team in an in-depth interview, it showed that there were 2 staffs in Donor Care team and they cared for 5,750 donors in 2018 In 2019, the number of donors was increasing by 66% so Donor Care team recruited one more person in the team However,

in 2020, the number of donors was increasing by 56% but the number of staff in Donor Care team was the same

Table 3: Number of donors and Number of Donor Care Staff from 2018 – 2020 comparison

Type of donor

One-time donor

Regular donor Yearly donor Monthly donor

Thus, because of lack of human resource, Donor Care team does not have time to email/call monthly donors to care for them or even ask them why they stopped donating Moreover, Donor Care team cannot make more

Based on (18), the labor shortage is the most challenging factor in economic growth in the country, which means it is also a challenging factor in business growth in the organization According to (19), poor employee engagement means poor donor service for both donors and beneficiaries This poses a blow to fundraising and other efforts towards achieving the organization’s mission

Thus, based on (18), (19), and in-depth interviews, due to lack of human resources, the Donor Care team could not communicate frequently with the monthly donors and produce the products as their requirement that leads to the poor donor care service quality of ABC Vietnam

5.3 Potential cause 3: Manual Database Management

The Donor Care team is manually managing donor database by Excel and beneficiaries information by Word so it not only takes their time every day to input and update the data but it is also not a safe and effective information storage system As table 3, we can see that

by the end of 2020, ABC has nearly 15,000 donors while there is more than 12,000 monthly donors There is the average 3,000 – 4,000 monthly donors that transfer the donation every month but all transactions are keeping manually by Excel that leads the mistakes in caring donor, takes time to input and update data As in an in-depth interview with Mr Minh, he

shared “Donor Care team some time sent email to wrong donors because that donor has changed email address but Donor Care person forgot to update or input under another donor’s name Last month, we got the complaint from 4 donors for that mistake” [APPENDIX B, page 55]

Besides, Ms Lan – Donor Care person also said that Donor Care team sent email by mail merge so it is taking a lot of time for the team to send thank you and confirmation email to

monthly donors every day Therefore, she usually worked overtime to wait for all emails gone to monthly donors every day because the organization’s policy that is Donor Care team has to send thank you and confirmation email to monthly donors within 1-2 days after ABC Vietnam has received their donation amount

Furthermore, in an in-depth interview with Mr Minh, he shared that “Because the donors fund ABC Vietnam’s operation, so we have to spend most of the money to beneficiaries This

is the reason why the organization doesn’t budget for a system to manage database recent years” [APPENDIX B, page 55]

According to (20), the important issue to data entry manually is human error, because everyone knows that humans are not perfect, they are easy to make mistakes while inputting data On the other hand, manual database management put pressure on customer service as customer queries could be difficult to respond to as information is stored in different places and may even require that we find the right person before being able to respond (21)

Therefore, based on the in-depth interview with Donor Care team and the literature (20), (21) showed that lack of financial capacities and lack of data management system are the causes that Donor Care team has to manage database manually That leads to the poor donor service quality of ABC Vietnam

Combining all of the information obtained through in-depth interviews and literature, the thesis has drafted the secondary cause-effect map for the main problem and its potential causes as in Figure 9 below

The Poor Service Quality of Donor Care

Manual data management

Lack of financial capacity

Lack of database management system

Lack of donor segmentation

Lack of HR to interact with monthly donors and

to produce products as monthly donor required Lack of financial capacity

Figure 9: The secondary cause-effect smap for problem solving at ABC Vietnam

6 Main cause validation

From the previous section, this thesis has drafted three potential causes leading to the poor service quality of donor care of ABC Vietnam At the same time, we also know that these factors are mainly responsible for the problem in one way or another However, as the human and financial resources that ABC Vietnam has to solve the problem are very limited, and that not all causes can solving by the organization Therefore, it is reasonable that we are going to determine the root cause – the one factor that is most influential and feasible to take action With such an objective, the following part is going to utilize primary data collected from in-depth with Mr Thien, the CEO and Mr Minh CFD Director of ABC Vietnam The reasons that the author chose Mr Thien and Mr Minh are because they are the key decision-makers of the organization and they know best the situation in terms of resource availability, the severity of the problem, the appropriateness of the solution, the success probability of the corrective efforts and so forth Moreover, they will be directly responsible for the implementation and management of the whole problem solving process

After an in-depth interview with Mr Minh and Mr Thien about the potential causes which lead the poor donor care quality, the knowledge obtained that is they knew that ABC Vietnam needs to improve donor care service quality by interacting more to monthly donors However, if ABC Vietnam segments the donors now, Donor Care team does not have