CDFIs and other Community Development Corporations (CDCs) are in a challenging position. As mission-driven lenders, commercial technical solutions fail to meet their needs. Mission-driven lenders typically require greater flexibility to represent lending terms, integrate programs into the pipeline (e.g. financial counseling prior to approval), and track lending activity back to philanthropy. In this post we will describe how we have leveraged Salesforce to meet the needs of community lenders.
Functionality + Flexibility
One of Salesforce’s greatest strengths comes from its core functionality around lead generation and pipeline management. It is an effective tool for tracking leads, converting those leads into applicants, and tracking the application process from initial contact all the way to conversion. If configured correctly it can empower users by streamlining the application process via workflows, automating key tasks such as scorecard related decision making and assignment of applications. Additionally, it provides powerful analytics regarding pipeline management and historical lending trends.
Tied into this core strength is Salesforce’s flexibility – the system can be tailored to meet your organization’s needs. For example, you can define the stages and sub-stages relevant to your specific application process – the triggers and workflows that move an applicant from one stage to the next and the means by which an applicant is transitioned from one staff member to another. As a result, you will know exactly where each lead, prospect, applicant or client is in your pipeline. With the right reports you can see where the bottlenecks are, and thereby focus management’s attention to resolve them.
This flexibility extends to integration with other solutions. Salesforce has over 3,000 apps on its AppExchange that offer powerful functionality and seamless integration with the system. If you need to build an online form that automatically feeds prescreening and application information into Salesforce there is FormAssembly and Formstack, among other solutions. Email marketing is offered through Salesforce’s Marketing Cloud, but there’s also the option to integrate tools like Mailchimp and Constant Contact. Other tools cover a wide range of functionalities including document signing (DocuSign, Sertifi, Conga), file storage (Box, SharePoint) and email management (Outlook, Gmail). There is no shortage of capabilities across the wide range of app integrations available for Salesforce.
Community Lending on Salesforce
Specific lending functionalities are also available. This can range from pulling credit reports and bank statements to automatically storing them in Salesforce, and pulling key data from those documents. There is also significant opportunity to automate the evaluation of an applicant’s credit-worthiness, and the resulting next steps. For example, if someone’s credit score and bank balances are above minimum thresholds, he/she can then receive an automated email to continue the loan application process.
Additional functionality include integrating a philanthropy process via the Nonprofit Success Pack. This allows your organization to easily perform financial reconciliation and/or donor stewardship. Ultimately, Salesforce’s automation and integration capabilities offer immense opportunities for community lenders to grow as it allows staff to spend their time more efficiently.
Continuous Improvement
Salesforce is never stagnant. This can be seen by the much more intuitive and user-friendly Lightning interface (in my opinion a significant improvement over the previous Classic user interface). The company has also invested heavily in Salesforce Einstein, “your smart CRM assistant”. Built into the Salesforce platform, Einstein is a layer of artificial intelligence that aims to help organizations achieve more in the areas of growth and customer service using data and analytics. For example, Einstein can predict which leads have higher probability of conversion to clients or determine expected customer needs once they become a client.
Implementing Salesforce
One may ask, “If Salesforce offers so much functionality and is such a powerful tool for CRM, why do we hear about Salesforce implementations that have failed?” The answer to that question is also one of Salesforce’s greatest functionalities: flexibility. The challenge is that Salesforce is so flexible an organization can do practically anything they want with it. For those organizations who require significant automation, flexibility or tailoring of the system they will need knowledgeable resources to help with the implementation. This can take the form of an in-house Salesforce Certified Admin or an external partner who understands the organization’s day-to-day operations. We have seen many Salesforce implementations stall because the configuration and development were not tailored to an organization’s business processes, hence the organization ends up with a glorified database. Stalling also occurs when the solution was built by a vendor focused on the commercial lending market who does not understand the nuances and unique needs of a CDFI. The key is to focus on your fundamental business processes, understand what can be automated vs. what requires the human touch and then customize Salesforce accordingly.
Organizations that implement Salesforce also need to consider the total cost of ownership (TCO) between licenses, data storage costs and maintenance. Salesforce offers a free instance for nonprofit organizations with 10 or fewer licenses. As the organization grows, they need to consider the cost of licenses for peripheral applications or additional Salesforce licenses down the line. There is also the time investment that Salesforce requires during its three upgrade releases per year. This is often an exciting time that showcases new features and functionality, as well as bug fixes. However, CDFIs who implement Salesforce must be prepared to do testing so that these new releases do not have any adverse impact. By understanding the TCO and preparing for upgrades, CDFIs should be able to successfully implement and maintain Salesforce.
Summary + Conclusion
The bottom line is that Salesforce offers many attractive features and is flexible enough that it can cater to your organizations current and future needs as they change over time. This is true so long as they have the right resources to customize and maintain it, whether it is an in-house admin or a Salesforce partner. If Salesforce is built with your business in mind, leveraging native functionality as well as integrations with key applications, it can truly be a powerful tool used to achieve your mission.