A PRACTICAL GUIDE TO NONPROFIT STRATEGIC PLANNING

More than 90% of nonprofits surveyed claimed to engage in some sort of strategic planning. Only 55% agreed that staff at all levels were included in the planning process. Fewer than half (47.7%) of these organizations counted the execution of the plan as a key metric in staff performance reviews. (“Wake Up Call” 2018 Nonprofit Sector Leadership Report – Concord Leadership Group) Nonprofit organizations that are most successful in strategic planning are more likely to deliver a distinctive impact on their communities and more likely to have greater sustainability and stability of funding. (Reid et al, 2014) 

Welcome to our “Practical Guide to Nonprofit Strategic Planning.” This guide is designed to help you and your organization better understand the strategic planning process, its role in your organization and how to implement a plan successfully.

What is a strategic plan?

A strategic plan is a flexible guide that links your organization’s mission and values with its actions and lays out a set of measurable goals, objectives and tactics to help your nonprofit achieve its long-range vision.

But unlike your long-range vision, which is your organization’s aspiration for the future, a strategic plan provides structure and helps you put your priorities front and center. It also helps you determine which tactical and actionable items to include in your annual operating plans. A well-written and properly executed strategic plan is a strong and ever-present bridge between what your organization is doing today and where you want to be in one, two and three years.

But for all that a strategic plan is, there are two things it definitely isn’t. It’s not static and it’s certainly not a doorstop! Many organizations spend hundreds of hours creating a strategic plan, but once it is finished, it is rarely, if ever, opened until the next iteration is due. The best strategic plan is one that takes center stage in your organization and is very much alive and adaptable to change. Our world, community needs and even funding are constantly evolving and your plan can help you address both challenges and opportunities.

Why do you need it?

Some leaders question the need for a strategic plan, especially when they are concerned about an uncertain future. (Learn why planning is especially important during uncertainty.) Creating one is no small task, and frankly, the notion of undertaking a new strategic plan isn’t always met with enthusiasm.

However, a strategic plan will give you and your team structure to accomplish your long-term vision and the latitude to change course if needed. And perhaps even more importantly, your strategic plan gives you the framework to unleash and implement big ideas that will put your organization above the rest.

It aligns the organization’s vision with current initiatives.

For a strategic plan to be effective, it must align your long-range vision with your nonprofit’s current annual plans. Taking time to think strategically and develop a mid-range plan helps you evaluate strengths, weaknesses and constraints of your current team, address issues or barriers to success and create a supportive infrastructure to complete it.

It challenges your organization to think beyond the current year.

Many nonprofits are stuck in the year-to-year rut, kind of like an ongoing laundry cycle – wash, rinse, spin, repeat. A strategic plan forces your organization to look at its long-range hopes and dreams, develop ways to accomplish them and think beyond the day-to-day operations.

It guides your growth and gives you focus.

Leaders often joke about chasing the shiny object and getting pushed off track. (Squirrel, anyone?) A strategic plan helps guide your growth by breaking your long-term vision into manageable parts and alleviates distractions. When you have a solid strategic plan and a new idea or initiative comes your way, you can always ask yourself “does this align with our strategic plan/initiatives?” If the answer is no, you pass.

It gives your team something to aspire to.

The best way to gain the confidence of your team is to provide them with direction on where they are headed. This is true all the time, not just during a crisis. As a leader, you must have a plan that outlines not only the vision, but the action. When you do, your team will know what is expected of them and will help you achieve those goals. Understanding where you are headed also gives your team hope that your organization will be sustainable in the future.

Tips, Tricks and Ideas: 

When considering new ideas and initiatives, ask the following questions:

  1. Does it fit within the context and goals of our current strategic plan?
  2. If you answer “no” to question one, does it help you achieve your organization’s long-range vision?
  3. Did you answer “no” to questions one and two? If so, is the initiative critical to the overall operations of the organization?

If you end up answering “no” to all the questions, then the initiative probably isn’t a priority.

What is included?

Strategic plans must include goals, an accountability structure, deadlines and measurement tools for organizational leaders (staff and board) and cover all areas of your organization that have an impact on the long-range vision.

SMART goals 

Your strategic plan must have SMART (specific, measurable, attainable, relevant, timely) goals. These are clear and detailed metrics that everyone understands are key to your plan’s success. SMART goals will show your organization where you want to go, how you will get there and by when.

A clear accountability structure 

Having a defined accountability and ownership structure is essential to completing the plan. And don’t forget, the plan’s ownership isn’t just the responsibility of management. Ultimately, every member of your organization must see how and where their role fits into the plan. Your plan should be creating energy and momentum, not dragging everyone along.

Realistic deadlines 

Your strategic initiatives will gain little or no traction without concrete and realistic deadlines. Spread deadlines out over the strategic planning period so your team doesn’t burn out. It is common to overestimate what will happen in year one and underestimate what will happen in year three.

Measures of success

Agree on what success will look like for your organization. You may want to measure dollars raised, capital projects completed, increases in people served, the on-time rollout of a new service or program, etc. You may also want to measure if you meet certain benchmarks or program numbers against budgets. But don’t forget – measurement isn’t all about how you’ve succeeded. Not being afraid to check on progress and take a hard look at activities or programs that just aren’t meeting expectations is one of the big benefits of a living, breathing strategic plan. Healthy and vibrant organizations make regular adjustments and course corrections.

A timeline for completion

Many organizations find that a good strategic plan covers about three years, which is long enough to complete many large-scale initiatives (facility planning, new construction, program and staff expansion, fundraising growth, etc.). Three years is not too long that your leadership, board and staff become disengaged and gives your nonprofit latitude to make changes based upon unexpected circumstances i.e., natural disasters, pandemics and economic downturns.

Tips, Tricks and Ideas:

Develop measurable goals.

  • Capital and facility expansions (renovate clinical space by X date)
  • Fundraising growth (raise 10% more each year for three years)
  • Program initiatives (add advanced version of your beginner program)
  • Staffing (increase staff by 10% to meet capacity)
  • Mergers/acquisitions (create MOU for merger with ABC nonprofit by X date)
  • Scalability (develop new business unit by X date)

 

Be clear about accountability. 

  • Assign a “lead” for each initiative and a team to support them. When more than one person “leads” a strategic goal or objective, that project often falters because there is no one heading up the effort. This doesn’t mean others won’t have key roles in the process. If you choose to assign “co-leads” to a project, be very clear about each person’s role. 
  • Don’t let the responsibility fall on one person. Spread accountability for goals among key leadership and throughout the organization.
  • If you have the capacity, consider temporarily shifting some or day-to-day responsibilities from staff who have large strategic responsibilities, so they have ample time to focus on strategy.

Assembling your team

Developing a strategic plan is a team effort. One of the challenges in the beginning is deciding who to involve and when. Assembling your team requires careful thought and consideration so you get the best plan possible and are set up for a successful implementation.

There is ultimately no right or wrong answer about who to include. Smaller nonprofits may have a larger percentage of the organization involved, whereas a large organization may have a dedicated strategic planning team of senior leaders and board members. No matter who you include in the planning process, the entire organization must be aware of the plan and their role in it. 

Choose team members based on your end goal.

Be clear about what you want to accomplish. Did you merge organizations and need to define your direction? Is there an increased need for your services and you want to expand? Did the organization’s long-time leader or founder retire? Are there significant internal changes that need to be made?

Include personnel that will be critical to the plan implementation.

If you anticipate your plan will require key departments or personnel to implement it, you must have people from those departments on the strategic planning team. They will provide important insight and their buy-in from the beginning will be important to the plan’s success.

Involve a diverse group of people that will offer a range of ideas, perspective and knowledge.

Your nonprofit likely serves, interacts with and employs people from a wide range of backgrounds – socioeconomic, educational, ethnic, racial, age, gender, etc. So, your strategic planning process and team must reflect this diversity. This can be done through interviews and/or planning sessions.

Ultimately, you can’t (and shouldn’t) include everyone. When you include too many people in the process, the plan becomes more about building consensus than being strategic. The right number of participants gives your organization the information and strategic guidance it needs, while allowing you to effectively manage the process and build an actionable plan.

Tips, Tricks and Ideas: 

Merged organizations may need to include program, fundraising, accounting and marketing team members from both organizations. Organizations who are expanding may need team members that can provide financial background, program insight and construction experience. If you want to address customer service issues, be sure to include people who are interacting with the public.

Consider involving:

  • Patients, clients or others to represent the people you serve
  • Board members to bring strategic thinking and governance experience
  • Staff of different ages, gender, race, experience, position, etc. to represent your internal team
  • Financial team members to provide forecasting help
  • Operations staff to identify issues

Facilitating the process

“So how do we get started creating our strategic plan? Do we do it ourselves or hire an outside facilitator?”

 Simply, it depends.

There are advantages to having an outside facilitator, yet some organizations have valid reasons for developing their own strategic plans. You must choose what will work best for your nonprofit and help you get a plan that aligns with your long-rage vision. Don’t rule out a hybrid model either. You can use a consultant to assist only in the beginning stages and perhaps at key points in the implementation. Be aware though that some consultants may not work this way because of their own philosophies and experience with strategic planning.

Reasons to facilitate your own strategic plan

You have a limited budget. There is no money to hire outside counsel.

You have internal experience. A member of your board may offer to donate his or her services.

You only have simple updates to make. Your organization may already have a solid strategic plan and completed phase one. Your next plan may only require straightforward updates.

 

Reasons to engage outside counsel to facilitate your strategic plan

Your organization or team is new to the process. A quality consultant will help you develop a solid plan and teach your team about the strategic planning and implementation process.

Your leadership has changed. Outside counsel can help manage the leadership transition and incorporate the new leader’s plans with the existing organizational vision.

You value the counsel of an experienced, neutral party. Consultants are generally neutral and unbiased and will help you manage opposing opinions or directions from your board or team.

Your board and internal team need clarity on achieving your vision. Board/staff alignment can be tricky. Counsel can help both parties understand each other’s motivations and concerns.

You want/need accountability. You can have a great strategic plan. But you cannot complete it if your team struggles with accountability. A consultant can help you build an accountability structure.

 

Choosing an outside facilitator

When choosing an outside strategic planning firm or consultant, consider:

Experience: Does the firm or consultant have experience developing strategic plans? Can they provide referrals?

Cost: Expect to pay between $5,000-$25,000 (or more) for a nonprofit strategic plan. But make sure you know what you are getting. A $5,000 plan may only include a retreat facilitation and a simple dashboard. A $25,000 strategic plan may include the retreat plus staff planning sessions, enhanced dashboards and ongoing accountability work.

Fit: You will be working with a strategic planning consultant(s) for several months. Make sure they are a good fit for you and your organization.

Tips, Tricks and Ideas:

When considering consultants, ask yourself:

  • Can I have open conversations with this person and trust them with confidential information?
  • Will this person/team work well with our board and staff?
  • Does this person know enough about our industry? If they don’t, do I feel comfortable that they will take the time to learn about us so they can facilitate a good planning process with our team?

Implementing your plan

You can have the best strategic plan in the world, but if there is no structure to implement it, the time and effort you spent putting it together will be wasted.

Implementing plans, whether they are annual, strategic or long-range, requires discipline and accountability. Basically, “goals and plans with no action get no traction.” So, it is important to keep strategic goals and tasks front and center.

Create an accountability structure.

We mentioned before that if everyone is responsible for leading a goal or task, then no one is responsible for it. Every goal, objective and task should have one point person assigned to it with a team supporting that person. This eliminates confusion as to who is supposed to be coordinating and completing the effort and allows for effective delegation of project components. To reiterate, it is important that the entire organization is aware of your nonprofit’s strategic initiatives and that team members throughout the organization embrace your long-range and strategic vision.

Example: ABC Nonprofit has the strategic goal of adding a new program for the organization that will meet an important community need. Kris is responsible for leading the team that is developing the business plan for the program or service. Team member Pat in marketing is responsible for completing the competitor analysis and developing a rollout strategy, Sue in finance is responsible for developing a pro forma providing financial forecasting, and Joe in development is responsible for identifying grant funders and developing grant narrative to generate start-up monies. Kris’s job is to work with the program team to build the program, coordinate whole team meetings and develop the final plan for board approval.

Incorporate your strategic plan goals and components into your annual goals.

Strategic plans are sometimes harder to accomplish because they aren’t ingrained in regular routines or workloads. But having all your goals incorporated into one document makes them easier to review and manage.

Review your strategic and annual goals quarterly.

Breaking your annual goals into 90-day increments will help your team increase the overall completion rate of projects. It is easier for teams to plan and focus on shorter time frames such as three months as opposed to saying something will be done at the end of the year. It also helps you plan projects around heavy workload times for particular departments.

Communicate plan progress and celebrate successes.

The more you communicate the progress you are making on the plan, the better your team will understand where the plan is in the process and how they fit. Celebrating that progress and successes makes the team feel proud of their roles and motivates them to continue working on the plan. Add strategic plan updates as a regular discussion at staff meetings, celebrate big successes with a team lunch, recognize key staff members in board correspondence and include updates in regular newsletters as appropriate.

Tips, Tricks and Ideas: 

Set quarterly meetings to review and set goals. Make it fun by scheduling an out-of-office activity, bringing in a catered lunch for the team or creating a game around the planning session.

Looking for some help with goal implementation and other ways to run a more efficient organization? We recommend EOS and Traction by Gino Wickman.

Building an effective strategic plan includes much more than just facilitating a retreat and creating a list of goals, objectives and tasks to cover a three-year period. When it’s done right, an effective strategic plan brings together the right team, provides your organization with an accountability structure and aligns your long-term and annual goals. It’s all about giving the people you serve what they need in the best way possible.

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A Practical Guide to Nonprofit Strategic Planning

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