Leadership Workshop Series
Nonprofit Strategic Planning
May 5, 2001
Presenter
Jude Kay
Senior Staff Consultant, Compass Point Nonprofit Services
On May 5, 2001 the Stanford Graduate School of Business' Public Management Program and Alumni Consulting Team cosponsored a workshop aimed at improving leadership in social purpose organizations. GSB alumni and students interested in nonprofit strategy consulting were among those who attended the May workshop. Jude Kaye, a nationally respected trainer and consultant, was invited to present a one-day seminar concerning strategic planning for nonprofits based on a consultative model. Much of the material presented in the workshop can be found in Ms. Kaye's book, "Strategic Planning for Nonprofit Organizations: A Practical Guide and Workbook," co-authored with Michael Allison.
Objectives of the Seminar
- Increase understanding of the unique circumstances of nonprofit organizations.
- Increase knowledge of the strategic planning model.
- Develop skills for helping nonprofit organizations to be more strategic in their day-to-day operations and in their thinking.
- Discuss various activities that could be used within the strategic planning process and share ideas.
- Learn the framework for consulting on strategic planning.
Unique Character of Nonprofits: Positives and Challenges
- Passion for Mission
Creates belief, optimism and the desire to make the world a better place.
Becomes all-important leading to misallocation of resources and a lack of focus on results.
Creates rigidity and a sense of righteousness as the personal becomes political and vice versa.
As a consultant it is your job to be aware of this dynamic and use your conflict resolution skills. - Atmosphere of Scarcity of Resources
Creates a reality and a mentality of being under financed.
Consultants are often resented because there is a belief that you should be working for free. - Dual Bottom Line: Financial and Mission
Nonprofits often have a mentality that financial success and staying true to the mission are mutually exclusive. - Outcomes are hard to measure because you can't focus on profit.
Consultants need to develop plans that articulate what success looks like and how to measure it. - Governing Boards
Boards can be a challenge if they try to supplant the staff in running the daily operations.
Staff is for day-to-day. Board should create "intergenerational equity" by focusing on the long-term benefit.
Consultants have to make sure the board is clear on which "hat" they are wearing (e.g., board vs.. volunteer).
Consultants also need to work with board to show them the difference between effective supervision and micro-management. - Third Party Fundraising
Donors have their own agendas and try to influence the organizations.
Consultant has to be strategic to insure that the "tail does not wag the dog." - Mixed Skill Level of Staff
Some people are kept around out of kindness. - Bias Towards Informality, Participation and Consensus
Consultant has to live with bias after the opportunity to hear and be heard.
Consultants also have to work towards consensus, but have to create a fallback if consensus can't be reached.
Process of Consulting: Three Dimensions of "Client Centered Consulting"
- Client Centered Dimension:
Use the language of the nonprofit (e.g., clients vs. customers)
Maintain confidence and control of client.
Perceived resistance as your best friend. It means that client is feeling lack of confidence.
Make client feel that they have a choice including to continue as they have always done (i.e., the past has a vote, but not veto power).
Manage change.
Strategic plans don't fail, but implementations may fail.
Individuals need skills or else they will sabotage.
Staff fears need to be addressed. - Consultant Centered Dimensions:
Consultants have to create rules and conditions for success.
Clients do not have to follow these rules but they need to listen them. - Infrastructure Centered Dimensions:
Understand the business and its challenges.
Decide your service priorities. - Diagnostic Framework
Need to identify the real problem before the strategic planning.
Training is usually not the problem, but rather, the organization does not have the systems, structures, and organizational culture to support the skills.
Consultants need to be intentional about using this framework.
Always keep "no" in your hip pocket in service of the clients needs. If the client wants you to focus on skills, but they really need to focus on structure, say no. - Six Stages of Consulting: A consultant should be aware of the activity,
outcome and product of each one of the following stages:
Entry
Contracting
Data Gathering
Action/Decision
Intervention
Ending vs. Strategic Planning
Success of Strategic Plan
- The consultant's goal is to teach the client to think more strategically.
Client does not need to accomplish everything they set out to do.
The client should focus on what was accomplished and why other goals were not. - Meaning of Strategic
Proactive and intentional as opposed to reactive and opportunistic.
A systematic process.
Strategic plans focus on results rather than methodological process. - Seven Phases of Strategic Planning
Getting set up for success.
Articulating vision and mission statement.
Assessing the environment.
Agreeing on priorities.
Writing the strategic plan.
Implementing the plan.
Monitoring and evaluating. - Language of Strategic Planning
Agree on the language to be used.
Be clear on the difference between ends and means.
Means include: Internal Vision, Business, Programs and internal management.
Ends include: External Vision, Purpose, Goals, Objectives.
The purpose of an organization will rarely change and should describe:
What you do
Values and beliefs
Focus of work (geography).
Purpose needs to more than a slogan.
Goals need to be intentional.
Strategies are the key implementation methods. - Strategic Plan Philosophy
Always have a strategic plan.
Create an inclusionary process. The process is as important as the document.
Be intentional.
Use plan as a guide, not a substitute for substantive decision-making.
Update and revisit plans every year.
Remember that planning is not a linear process.
Make the plan part of the larger system, so that it impacts and is impacted. - Role of Consultant
Serve as an expert of the strategic planning process.
Facilitate meetings and take away worry about process.
Ask the hard questions.
Be an "extra pair of hands" to talk to external stakeholders (but remember as a consultant you can only get information, you can't build relationships). - Edgar Shein's Three Roles for Consultants:
Process Consultant - Work together to solve problem.
Expert Role - Consultant gives answers/suggests solutions.
Doctor/Patient Relationship - Consultant diagnosis and gives solution.
Process Consultant role is advised for most cases to receive buy-in.
Consultant can be seen as the "holder of hope" but responsibility ultimately lies with the organization.
Working with the Seven Phases
- Getting Ready
Asking questions is essential.
What would success look like upon completion?
What do you wish to achieve?
What are the "big picture issues"? Is the problem strategic or operational?
What is not negotiable?
Do you have buy-n from the necessary parties?
What is the time frame? - Challenges
Insufficient information.
Insufficient board interest.
Resistance from staff.
Concern from staff that the process takes too much time.
Expectations of consultant.
Hidden agendas. - Solutions
Create an information gathering plan.
Tier people to talk to.
Set up a strategic planning committee and receive regular updates.
Set expectations for staff through education.
Identify and address staff fears and concerns.
Spell out your expectations clearly in the contract.
Don't be afraid to stop the process.
Remember that the plan is a guide, not a substitute for decision making. - Articulating Vision and Mission Statement
Based upon information obtained in Phase 1 this may actually follow Phase 3. Make sure vision is aligned with reality.
Challenges:
Vision Statement is too soft.
Articulation of new statement raises fears.
Some people are invested in ambiguity.
Perceived waste of time.
Wording issues. - Solutions
Create a map that shows exactly where you want to go.
Concentrate on what it is that the organization does well.
Create a safe environment to have conversations.
Focus on clarity in all discussions.
Focus on positive aspects of having a good mission statement (e.g., good for fundraising, vision).
Get agreement on the wording up front. - Assessing the Environment
The assessment is a good way to educate the board about the process and get them involved.
Use of a SWOT grid is helpful - Strengths, Weaknesses, Opportunities and Threats. Helps shape priorities through juxtaposition.
Challenges:
Data overload.
Confidentiality concerns. - Role of Consultant and Solutions
Be clear about whose job it is to collect the data.
Make data collection a shared process to avoid bias.
Do not assure confidentiality because it is your job to raise issues, but do assure anonymity.
Be careful about how you get used. You do not want to be in the role of the go-between. - Agreeing on Priorities
Challenges:
The consequence of decision are for real.
Certain items will be non-negotiable.
Confusion between core competencies and strengths.
Funding may not be able to meet priorities.
What happens if funding is cut?
Solutions:
Get criteria for decision-making.
Spell out non-negotiable items.
Create a priority list and be able to draw the line.
Do a cost/benefit analysis.
Use the Macmillan Matrix.
Need to do a program portfolio then subsidize it .
Perform a cost analysis.
Use a core competencies work sheet.
List service delivery and administrative core competencies.
Divide into competencies in which you excel and those that need work
Create an action plan for each competency that needs work. - Scenario planning
Look at "what ifs." If environment is unclear (e.g., post-election), will funding change? - Writing the Plan
Keep the plan to ten pages or less.
Do not overdo long-range planning because it assumes you can predict and control the future.
Make clear connection between Year 1 and Year 5 and use benchmarks.
Create goals with short and long range objectives in mind. Spell out the background for the decision for future reference.
Challenges:
Who will write
Keeping it brief
Solutions:
Consultant should not do all of the writing but can "hand hold" if necessary.
Be clear as to who is final decision maker on the plan. Should be the board.
Be patient; it can take 6-7 drafts - Monitoring
Bring committee together to reflect on the process.
Need an evaluation process.
