Strategic Planning Thomas P. Holland, Ph.D., Professor UGA Institute for Nonprofit Organizations.

Strategic PlanningThomas P. Holland, Ph.D., Professor

UGA Institute for Nonprofit Organizations

A Strategic Plan is

• Clear statement of the major goals and priorities of an organization that guide all decisions toward achieving its mission.

• Specification of the main values and directions as we approach our environment and constituencies, how we invest our resources for maximum results

• Demonstration of who we are, distinguished from others in our environment

Planning is a Process that• Is filled with decisions and actions that shape

and guide what an organization is, does, and why it does it

• Requires broad-scale information gathering• Explores alternative directions for the

organization• Emphasizes its future• Results in a tangible written document that

guides all organizational actions, including fundraising

• Teaches participants how to think strategically about the organization and its future

A Strategic Plan addresses

• What are the most important ways we can strengthen this organization and its programs in the coming 2-3 years?

• What if the future changes from our expectations? How will we be ready?

• Answers depend on careful analysis of internal and external factors.

• Challenge of mission-drift, self-perpetuation for its own sake.

• Clear priorities strengthen commitment and effectiveness throughout organization.

Why Participate in a Planning Process?

• For sharper organizational focus• To concentrate on priorities and key strategies• For a systematic approach to future thinking• To compete in marketplace more effectively• To determine our priorities• To evaluate organizational effectiveness• To clarify vision, mission, critical issues, and

strategies• To prepare for possible partnerships• To provide guidance to staff• To stay on track during leadership transitions• To demonstrate accountability

Components of an Effective Planning Process

• Gather information on market conditions and constituencies’ views

• Every member of organization must approach work in terms of engaging constituents

• Emphasize that accomplishments of this organization are due to constituents’ efforts

• Specify goals and action steps• Monitor results and publicize them• Modify programs (and people) that do not engage

constituents and produce results

Requisites• Everyone must be fully committed to meeting

constituents’ interests, from board and top management on to all staff.

• Acknowledge our strengths and weaknesses• Always tell the absolute truth about the organization

and its programs. Integrity builds trust.• Explain actions in light of mission and goals• Put our explanations in constituents’ terms• Focus on the key audience segments critical to the

organization’s success in reaching each strategic goal

Strategy vs. Operations• Most board and staff members (like most people)

come from positions of responsibility for operational decisions. That’s familiar territory.

• Most board and staff members (like most people) have little understanding of or experience with governance, strategic thinking, or planning for the future.

• As a result, discussions slide into familiar territory-- operations.

• Staff unwittingly foster such slides by providing more operational details.

Thinking Strategically• Back up and look at the big picture, not the details.

Important issues, not just urgent ones.• Focus on the future. What new ways of working

would be most satisfying to you?• Consider the forces in the community environment

that influence and shape what your organization does.• Be proactive, not reactive.• Brainstorm alternative future scenarios without

judging them. Invite others to do the same.• Questioning basic assumptions stimulates anxiety, but

don’t back away.

Are We Ready to Plan?Crisis Mode is not a good time to do this, such as

– Major funding shortage– Chief executive leaving– Majority of board resigns – Unexpected loss of board chair – Financial scandal

If the organization is stable• Does a strategic plan already exist? Is it working?• Have key strategies been determined?• Is there time to plan?• Is funding available?• Are board and staff committed to planning?• Who should facilitate the process?

If a plan already exists, then is continuing to follow it appropriate?

Yes, our board and staff are satisfied• Consider fine-tuning or reorganizing existing strategies and

activities• Just keep on with existing strategic initiatives

No, we are not satisfied with doing more of the same

• A new or revised planning process should begin

Is there Time to Plan?

Average Time Frame for Planning• Three to six months to complete planning and have

a document approved by board

Time Is Needed For• Attending meetings

• Gathering data

• Research and analysis

• Drawing conclusions

Is there Money to Plan?

• Money Is Needed To• Support information gathering, analysis, and research• Contract for consulting and facilitating services• Cover logistical expenses

• Develop a Budget • Type of process chosen • Size and complexity of organization• Number of people involved• Geographic spread of mission

• If Funding is Not Available, we must first• Create a plan to access funding• Seek donated services and meeting space• Look to board for financial support or planning

Are Our Board Members Committed?

• Commitment absolutely essential

• Should have willingness to– spend time planning– support expenses of planning process– monitor implementation of plan’s

strategies and goals– participate in asking for contributions,

opening doors, making connections to implement the plan

The Board’s Role

• Commits to planning• Ensures adequate resources• Decides on approach• Coordinates steering committee• Helps prepare and approves “plan to plan”• Ensures full board participation• Conducts board self-assessment• Reviews and approves vision, mission, critical

issues, and tasks• Makes final decision on approving plan• Ensures plan become operational• Ensures plan is fully implemented• Oversees accomplishment of goals

Chief Executive’s Role

• Seeks board’s buy-in for planning • With the board, ensures adequate resources• With the board, decides on planning

approach• With the board, appoints steering committee• Participates in “plan to plan” • Ensures participation of staff• Informs staff; encourages feedback and

input• Prepares operational plan with staff• Evaluates accomplishment of strategies,

goals, and objectives• Regularly reports status to board

Are our Staff Members Committed?

• Commitment essential for success of the effort.• Staff should have willingness to

– spend time planning– earmark funds for planning process– participate in gathering information– participate in identifying new goals and ways to

work– commit to taking on new and diverse roles and

responsibilities– monitor implementation of strategies

and goals of plan– use findings to fine-tune activities

The Role of StaffStaff <20:

• Expect participation from every staff member

Staff >20:• Create leadership team more directly involved in

planning

Staff will be involved with• Analyzing internal capacity • Formulating and distributing questionnaires• Organizing data collection• With chief executive, identifying critical issues

(vision, mission, strategies)• With chief executive, preparing operational plan• Implementation of plan

Board - Staff Partnership

• Both are needed to• Determine what information is needed and how to

get it • Share research and interview assignments• Discuss issues that arise in planning• Communicate disagreements and differences

of opinion• Search for new ideas and shared conclusions

Who Should Facilitate the Process?

• Should a Consultant Be Hired?• Assess whether there is a need• Determine if funding is available• Seek referrals for consultants who work

best with specific organizations

• Should a Board Member Act as Facilitator?• Caution: Board members are not the best option • If board member facilitates, he/she must

– remain objective – limit insights and ideas– act as catalyst in planning process

Typical Process• Start with board retreat to review purpose of planning, identify

key steps and expected results

• Identify important problems, issues to be addressed

• Select steering committee to implement process.

• Next meeting focuses on steps to deal with each issue and ways to involve constituencies. Who will do what, when.

• Collect information and ideas from constituencies.

• Bring findings to session for brainstorming on alternative future directions.

• Weigh alternatives and select best options.

• Formulate implementation plan and disseminate it widely.

• Specify criteria for monitoring implementation.

Who Should We Involve in the Planning Process?

• Full board• Chief executive• Key staff members• Donors• Other external stakeholders• Consultant?• Steering committee

Concentric circles of interest in a nonprofit organization

Constituencies=audiences=stakeholders

Clients

Board, staff,Volunteers

Donors

People with similar interests

Start: Where are We Now?

• If the organization performs in 2-3 years from now about like it does at present, is that O.K.?

• Are we all clear about the organization’s primary purpose?

• Are our organizational goals and outcomes clear?• Should we identify some new approaches for

implementing the mission?• Can existing activities be implemented

in a more effective way? • Should any of our programs be eliminated?• Is there a need for new programs and services? • Should we consider a merger or collaboration?

Involving our Stakeholders• Who are they?

• Clients, staff, board, funders, members, community leaders

• What can they add?• Involvement with internal/external assessments• Outsiders’ perspectives, fresh views of us, new

ideas

• Remember: people are more likely to be invested in conclusions they help reach.

Constituencies and organization must share in the mission and goals

• If they are based upon constituents’ concerns and interests, there will be energy and resources to achieve shared goals.

• The organization must know what criteria stakeholders are using to judge the success of its performance.

• Activities must be consistent with shared core values or there will be little chance of achieving stakeholder satisfaction.

Key Questions about stakeholders’ needs and interests• Who are our target audiences (individuals and groups we

have or want to have involved)?

• What are the key segments (sub-groups) within those groups?

• What are the needs and interests of each?

• What business do they think we’re in?

• How much interest or awareness do our activities generate among them?

• How satisfied are they with our output? Good fit?

• What are our competitors doing about these issues?

• Do we have any distinctions that allow us to be in a more attractive position than our competitors?

Tools for understanding our constituencies’ interests

• Focus group discussions

• Analysis of demographic & census data

• Key informants

• Surveys of consumers, staff, sponsors, referral sources– telephone– in-person interviews– on line or mailed questionnaires

Questions to help us Identify potential directions

• What have we done well? Not so well?• Should we fine-tune our current operations?

Work harder at what we’ve been doing?• Should we shift our focus and resources to

address an emerging opportunity?• If we could carry out any activities EXCEPT

those we have been doing, what would the organization look like?

• Can we convert a barrier or threat into an opportunity? What would it take? Can we do that? What resources would be needed?

More Questions

• What are some specific aspects of our organization and programs that would appeal to what kinds of donors?

• How could we build on those attractions to improve our work?

• What should we do to foster greater constituency engagement and loyalty?

• What do you suggest as good goals for the organization’s future? Why?

• Remember: the questioner should remain neutral and not influence others’ responses.

Examine internal and external environments

• Situation (SWOT) Analysis

– Internal

– External

Strengths

Opportunities Threats

Weaknesses

S.W.O.T. Analysis

• What are the key internal strengths and weaknesses of this organization?– Issues including teamwork, leadership, structure, consumer

interests, program effectiveness, staff satisfaction, donor and volunteer engagement

• What are the key external opportunities and threats facing us?– Issues including political and demographic trends, market

changes, competitors, suppliers, interest groups, governmental policies

• What are the alternative future directions this organization could take?– Suspend judgment to brainstorm and weigh options for

improving organizational effectiveness. Then assess choices for optimal benefits to constituents and organization.

Examples of Internal Issues

Strengths might include• Trained fundraising staff• Board has fundraising experience• Strong involvement of volunteers

Weaknesses might include• Lack fundraising experience or software• Volunteers will need office space• Limited interest in organizational change

Examples of External Issues

• Opportunities might include– Untapped prospect base: volunteers who

serve our clients– College town: can obtain fundraising help

through Greek system

• Threats might include– Organization X provides similar service– Community does not clearly understand

what we do and why

Examine the Responses• Look for ideas mentioned by several

respondents.

• Cluster similar ideas into themes.

• Ask what these themes suggest about the future directions of the organization.

• Evaluate themes for their fit with mission and interests of the organization.

• Weigh alternatives and select best options.

• State choices as goals.

Weigh program options in light of interest and competition

High interestLow competition(strong candidate)

High interestHigh competition(consider only if youhave distinctions)

Low interestLow competition(only if vital formission)

Low interestHigh competition(avoid)

Weighing our Alternatives • Some projects may operate at a loss because of

centrality to our mission (core)• Some projects not core to mission but money-

makers may be accepted to offset losses in others (cash cows)

• We may invest in growth of programs in hope they will break even in the future (venture capital)

• Some projects may be discontinued because they no longer meet the needs for which they were designed (dogs)

Plan should include multi-year financial needs

• Funding selected goals provides basis for fundraising plan.

• Options (on-going & new programs)– Priorities– Estimated expenses

• Estimated income– Renewable income

• Last year’s gifts minus non-repeatable gifts(Grants, personal gifts, contracts, fees, earned income)

– New income• Use historical rate of growth, OR combine with

new fundraising efforts

Examples of incremental strategies• Over the coming 3 years, our organization will

increase its scope and influence by developing alliances or partnerships with at least two other organizations in this region that have similar missions.

• By December 2011, we will have established specific procedures for evaluating member satisfaction with all our programs and services.

• By December 2011, we will have enlarged our membership by 50%.

• By the end of our coming year, we will have – Hired a volunteer coordinator and developed a

volunteer recruitment program– Had every board and staff member complete an

educational program on fundraising

Examples of re-directive strategies

• The Montgomery History Center will redirect its focus from on-site exhibits to– Assisting other local history organizations with expanding

and improving their services– Making our own resources available via the Internet

• The Knoxville Faith in Action Center will move from the direct provision of services to assisting local congregations in the delivery of those services.

• Eldon College will move from being a general liberal arts college to a regional center for career preparation, beginning with the fields of business, health care and electronic communications.

Writing the Plan

• Organizational description, where we are now• Issues prompting planning process• Ways we drew on constituencies for ideas• Key ideas we learned and used• Major goals of the plan• Budget and other resources for implementation• Steps and assignments for implementation• Criteria and methods for monitoring actions

Points to Remember

• We cannot do everything or talk to every person, so must prioritize.

• All new efforts must be evaluated based NOT solely on their potential as programs but also on their probability of success in gaining financial support.

• Plan for sustainability (e.g., sequencing or phasing in efforts over time).

• Keep good records.• Use process to help participants learn to think

strategically about the organization and its future.

Questions about our Plan

• Are our goals and steps compelling?• Are they attractive to our key constituencies?• Are implementation assignments to individuals and

teams clear and specific?• Do we have shared assumptions, expectations, &

priorities for our efforts?• Have we matched interests with tasks?• Does the evaluation component provide appropriate

information clearly linked to the assigned tasks?• What will we do when we encounter barriers?

Evaluate experiences to learn• What were the major factors that influenced

what we encountered?• What were our assumptions, expectations,

and actions going into the process?• In what ways did we influence the sequence

of events?• What could we have done differently to

make the outcome more positive?• What lessons we should take into the future?

Additional Resources

• McNamara, C. Field Guide to Nonprofit Strategic Planning and Facilitation. Authenticity Consulting.

• Bryson, J.M. Strategic Planning for Public and Nonprofit Organizations.

• Howe, F. Board Member’s Guide to Strategic Planning. BoardSource.

• Bradford, R.W. & Duncan, J.P. Simplified Strategic Planning.

• Fogg, C.D. Team-Based Strategic Planning.