Microsoft’s Common Data Model and What it Means for Nonprofits

Microsoft has been talking a lot lately about their Common Data Model as it relates to their solutions for nonprofits. The Common Data Model provides a framework for defining and storing data that can be accessed by multiple tools and applications that share the same common data model. As a nonprofit professional, it’s not necessarily important that you know the ins and outs of how the Common Data Model works. It is important, though, to understand what it is and its implications for the nonprofit sector. So, let’s dig in.

What is the Common Data Model?

Basically, the Common Data Model (CDM) for Nonprofits is a set of standard data definitions. By using a CDM when building applications, developers can ensure their products more easily exchange data with other solutions that are built using the same CDM.

Microsoft’s CDM is open and available for use with any service or application. To enhance the value of the CDM, Microsoft is working closely with people from various industries, including the nonprofit sector, to make the CDM more relevant by creating “Industry Solution Accelerators”. In short, these accelerators extend the CDM to specific verticals to enable independent software vendors (ISVs) and other solution providers to quickly build industry-specific solutions. The potential of these accelerators is that they will be easier to integrate and maintain because they leverage the CDM. This will translate into lower overall cost of ownership for the end customer. Without the CDM, each ISV would start from scratch to build a custom data model into custom solutions connected through highly customized, costly integrations.

With the Microsoft Dynamics 365 Nonprofit Accelerator and CDM for Nonprofits, ISVs and other solution providers can quickly build nonprofit applications based on concepts that nonprofits commonly use for constituent relationship management, fundraising, program delivery, and more.

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Microsoft’s CDM-first strategy

Microsoft not only entered the nonprofit market, offering more technology choices for the sector, but also started right off the bat with their Common Data Model and the Nonprofit Industry Accelerator. This is critically important for Microsoft’s strategy of building a strong community of multiple ISVs and system implementers (SIs) that deliver solutions to the sector.

To put this in context, when Salesforce entered the nonprofit sector, they started with the intention of developing a strong ecosystem of partners. However, because they began with a core nonprofit CRM application versus a CDM standard, some ISV partners have found it difficult to build applications that extend the core CRM solution (for functionality such as volunteer management, payment processing, and peer-to-peer fundraising) and also integrate quickly and smoothly with Salesforce-based nonprofit CRM applications.

This paradigm results in added integration and maintenance costs for nonprofits that use these solutions. It also has led Salesforce to shift their strategy and begin to deliver and manage their own nonprofit applications that integrate with each other (yet compete with their own ISV partners — effectively limiting the growth of the partner ecosystem).

With the benefit of hindsight, Salesforce has since made their Nonprofit Success Pack (NPSP) the default CDM. They also developed the Higher Education Data Architecture (HEDA) as they moved into the higher education market.

Microsoft’s entry to the market and commitment to CDM and a vibrant and sustainable partner ecosystem are worth watching. Add to this that Microsoft’s CDM is not tied to the Dynamics CRM solution, but rather is available to the entire Microsoft tech stack. As a result, the data stored in the CDM can be used in Dynamics CRM, the Power Platform, and beyond — allowing nonprofits to leverage their data and automations in and across the stack and also leverage Flow and Power BI to automate processes and build model-driven apps between Excel, SharePoint, Teams, Dynamics, and more. In addition, the Nonprofit Data Warehouse Quickstart is a pre-packaged, ‘one-click deployment,’ Azure based data warehouse solution that is currently in private preview, will offer nonprofits further extensibility of the CDM. Over time, this approach likely will have a much greater positive impact to nonprofits than if they started right out of the gate building products for the sector.

What does all of this mean for your nonprofit?

In the past, the tech strategy for many nonprofits was to look to a single platform for all their technology needs. In today’s evolving market, though, there are an increasing number of solutions that can help you meet your strategic goals. The three key vendors in the space now offer world-class commercial CRM platforms with accompanying business intelligence tools (Salesforce and Microsoft) and proven nonprofit point solutions (Blackbaud).

The evolution of strategy and approach by these nonprofit technology companies represents a dynamic time in the sector. As a relative latecomer, Microsoft has the benefit of learning from successes and missteps of the two other key vendors in the space, Salesforce and Blackbaud. Salesforce, on the other hand, knows the market well and has made tremendous contributions to nonprofit technology in the past 12 years. With nearly 40 years in the market, Blackbaud also has its own unique foothold in the sector.

Ultimately, your future technology strategy will likely be cross-platform, with a CRM solution at the center, augmented by best-of-breed point solutions from a variety of vendors and tied together through a BI tool. That’s why the Heller Consulting team keeps a close eye on Blackbaud, Salesforce, and Microsoft so we can help you find and implement the right combination of solutions to meet your goals.

Learn more about today’s nonprofit technology landscape and what it means to your nonprofit: Download Survival of the Nimblest: Today’s Nonprofit Technology Environment

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About the Author

Jeffrey Appell
Jeffrey began working with nonprofits in 1997. Starting out as an intern at the San Francisco chapter of the Anti-Defamation League he went on to be a Development Associate at the Jewish Community Center of San Francisco and then at... Read More

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