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strategic plan

Why Some Nonprofits Aren’t Ready for a Strategic Plan (Yet)

nonprofit capacityDon’t get me wrong, I am a huge believer in strategy. I talk about it All. The. Time. I firmly believe that every nonprofit should have a long-term strategy with a corresponding financial model.

But sometimes a nonprofit is not quite ready to create that long-term strategy because they don’t know what they don’t know.

When a nonprofit suffers from a host of problems that they don’t know how to solve, I encourage them to take a big step back. Because you cannot articulate your theory of change, your goals for the future, the makeup of your staff and board, your financial model, if you are putting out fires and struggling to keep your doors open.

Let me give you an example. An animal welfare nonprofit came to me recently wanting to embark on a strategic planning process. Yet, in the course of our conversation, they revealed that they currently faced a long list of challenges, including:

  • A disengaged board of directors
  • A poorly structured staff
  • A non-existent marketing strategy
  • An over-reliance on a couple of funding streams
  • An inability to articulate to outsiders what they do and why

These are huge challenges, and creating a strategic plan won’t solve them. If the leader of this nonprofit were to gather her board and staff and ask them to chart the next three years, they would only be talking in circles. Because if you don’t know what’s wrong, you have no hope of figuring out how to fix it.

You should only embark on a strategic planning process when you have the knowledge and capacity necessary to chart a clear future course.

So how do you know if you are truly ready to launch a strategic planning process? Start with these questions:

  • Do you have a critical mass of key board members who are excited about and in general agreement on the future of the organization?
  • Are you fairly confident of your cash flow over the next several years?
  • Do board and staff have the time, capacity and commitment to devote to a rigorous and external-facing, long-term planning process?
  • Can board and staff confidently articulate what the nonprofit does and why it matters?
  • Does the organization have the right staff in the right places?
  • Is your supporter/funder base growing?
  • Is the majority of your board effectively engaged in your nonprofit?

If you can’t answer yes to these questions, you may not be ready for a strategic planning process.

But all is not lost. Instead, you may need an organizational assessment (what I call a Financial Model Assessment) to determine what is holding your nonprofit back. An assessment helps a nonprofit figure out why money isn’t flowing the way they need it to be, why the board is disengaged, how to articulate what you do and why, how to structure staff effectively, and ultimately how to build the capacity and knowledge necessary to chart a future direction.

A Financial Model Assessment provides a roadmap to help a nonprofit board and staff analyze and prioritize their immediate challenges so they can address them in preparation for a longer-term planning process.

The approach, in essence is two-fold:

  1. Assess: Figure out what is holding your nonprofit back (from financial sustainability, operational effectiveness, board and donor engagement, etc.) and how to remedy those challenges.
  2. Plan: Chart a future direction that lays out the strategy for moving the organization to that next level.

It’s a one-two punch that is sometimes necessary when nonprofit leaders are so caught up in the day-to-day that they simply aren’t prepared to make the big, long-term decisions necessary in a strategic planning process.

If you want to get more strategic as an organization, I applaud you. But make sure your nonprofit is truly ready to create a strategy, or you will just be spinning your wheels and wasting everyone’s time.

If you want to learn more about these two processes I use with my clients, download the Financial Model Assessment benefit sheet and/or the Strategic Planning benefit sheet.

Photo Credit: Kale Taylor

 

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10 Most Popular Posts of 2015

10 most popular postsIt’s that time of year again — to put work away, enjoy friends and family, and give yourself a chance to take a breath. I will be taking the next two weeks off from writing the blog. But before I go, as is my tradition, I wanted to leave you with a list of the 10 most popular blog posts from this past year, in case you missed any of them.

And if you are feeling ambitious, you can also see the 10 most popular posts from 2011, 2012, 2013, and 2014.

I hope that you all will find some space over the next couple of weeks to relax, to get away, to regroup, and to ready yourselves for the next chapter. We need you social changemakers now more than ever, so please find some time to take care of yourself before you get back to taking care of the rest of the world.

Thank you for being part of the Social Velocity community and for all of your hard work making the world a better place. I wish you all a very happy New Year. I’ll see you in 2016!

  1. The Problem with Nonprofit Events
  2. How Scarcity Thinking Holds Nonprofits Back
  3. 7 Questions to Guide Your Nonprofit Strategy
  4. 5 Myths the Nonprofit Sector Must Overcome
  5. How to Build a Stellar Nonprofit Staff
  6. How to Create a Compelling Fundraising Ask
  7. 3 Signs of a Bad Nonprofit Strategic Plan
  8. 5 Fundraising Delusions Nonprofits Suffer
  9. What Do Your Programs Really Cost?
  10. The Network Approach to Social Change

Photo Credit: Ethan R

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Strategic and Sustainable Nonprofit Growth: A Case Study

AppleMark

I talk a lot about the many challenges of leading a nonprofit. But sometimes even success itself can be a challenge for a nonprofit. This was particularly true for one of my clients, Breakthrough Austin.

Breakthrough is a very successful nonprofit that identifies cohorts of 6th grade students who want to be the first in their families to graduate from college. The nonprofit then supports those students over the next 12 years so that they reach that goal. Over their 10+ year history, Breakthrough has achieved impressive student outcomes and the support of a deep donor base.

In fact, Breakthrough has been so successful that other schools and school districts have asked to add the Breakthrough program. But that’s not always a good thing, especially when a nonprofit doesn’t know where they can grow most sustainably and with the greatest results.

In the Spring of 2015, Breakthrough board and staff wanted to grow to reach more students, but they didn’t know how to determine when and where. They needed a strategic plan that could help them chart a growth trajectory to reach more students in a sustainable way. And baked into that strategic plan they needed strategic growth filters that helped them assess how to know if new locations were a good fit with their model and their long-term plans.

Breakthrough hired Social Velocity to lead their strategic planning effort. With my guidance, Breakthrough created an advisory committee of board, staff and key external stakeholders. I led the group to analyze the external environment in which Breakthrough operates, develop Breakthrough’s theory of change, refine their vision and mission statements, and articulate the goals and objectives and corresponding financial projections of the next 3 years for the organization.

Together we created the various elements of their strategic plan:

  • A Marketplace Map, to understand how their core competencies fit with a set of community needs, apart from their competitors and collaborators
  • A Theory of Change, to articulate the value they hope to create
  • Strategic Growth Filters, to analyze where they should grow
  • Revised Vision and Mission Statements
  • 3-Year Strategic Plan and Budget
  • Year 1 Operational Plan, to execute on the strategic plan
  • System for Monitoring the Plan, to make sure it is coming to fruition

Over the course of the 6-month planning period, Breakthrough board and staff became increasingly excited about their new strategic plan and the clarity it gives them about how and when to grow. They are already putting the pieces in place for expansion and are beginning to build the additional capacity necessary to get there.

Creating a strategic plan helped Breakthrough become crystal clear about how to grow strategically and sustainably, as Michael Griffith, Breakthrough Executive Director put it:

“Nell helped us chart a course for the future that meets the needs of our current students and allows us to expand to serve even more. She was skilled at developing a framework that allowed us to grapple with the tough questions of strategy and sustainability. We are thrilled we made this investment and look forward to the coming years with a plan firmly in place!”

If you want to learn more about the strategic planning process I take clients through, check out the Strategic Planning page, or if you want to read more client case studies, check out the Clients page.

Photo Credit: Breakthrough Austin

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3 Signs of a Bad Nonprofit Strategic Plan

nonprofit planningI’ve been leading several strategic planning processes lately, and as we wrapped up the last planning meeting for one of my clients (who had been encouraged to create a strategic plan by a funder) my client announced:

“I have to confess that when we started this process 6 months ago I inwardly rolled my eyes because I thought it would be a pointless process, full of silly buzzwords and with little value. I have completely changed my mind. I can already see how this new plan is making us smarter, more effective and more sustainable.”

Yep, I completely get it.

Strategic planning, when poorly done, is just a joke. But, when strategic planning is done well, it can completely transform an organization.

And there are three key places where a bad strategic plan falls short:

  1. Your Strategy Isn’t Big Enough
    To create an effective strategic plan you have to start with the big picture. You must analyze and articulate who your target audience(s) are and your theory of change. Then you must look externally to understand the needs, the competitive landscape, the funding, the changing factors in the marketplace in which you operate. Nonprofit leaders sometimes mistakenly think they are creating an effective strategic plan when they sit in a room, look around at their fellow board and staff members, and ask each other what they think they should do. It is also a mistake to think that in such a rapidly changing world you can simply develop a status quo strategy. In order to stay relevant and sustainable you have to understand how you interact with the forces outside your walls and outside your control. And here’s a little secret: the more you think about the bigger world out there, the more excited your board and funders will be by the plan. Your nonprofit doesn’t exist in a vacuum, neither should your plan for the future.

  2. Your Strategy Isn’t Small Enough
    But the other danger is to get too big and neglect the small part — the execution and monitoring of the plan. It’s great to have a bold vision and ambitious goals for the future that flow from an exciting theory of change. But that’s not enough. How will you implement it? How will you break down tasks, and responsibilities? What’s the timeline? And what is your process for determining, on a regular basis, whether the plan is actually coming to fruition? A good strategic plan, one that will actually transform your organization, requires operational detail and a process for monitoring it over time.

  3. Your Strategy Ignores Money
    There is no effective strategic plan that neglects to answer how you will finance it. That’s why a good strategic plan devotes one of its goals to money. How much will it cost to deliver on all of the goals of your plan? How will revenue (and capital if you need it) flow to meet (or exceed) those expenses? A good strategic plan forces nonprofit leadership to become financially savvy (when they may not have been before) and begin to use money as an integral management tool.

How does your nonprofit’s strategic plan stack up? Is it big enough, small enough, and well financed? If you want to learn more about what a strategic planning process looks like, check out my Strategic Planning page or download the Strategic Planning benefit sheet.

Photo Credit: ESO/H. Dahle

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What’s Your Nonprofit’s Theory of Change?

Theory of Change GuideOver the past few years I’ve developed a Social Velocity library of books, step-by-step guides, and webinars. My hope is that these tools can make the concepts I use with my consulting clients accessible to smaller and start up nonprofits who aren’t ready for or interested in a customized approach.

The tools follow the methods I develop in my consulting practice (like creating a financing plan, growing the board of directors, designing a theory of change) so when my consulting approach changes over time, the tools must change as well.

Which brings me to the Design a Theory of Change Guide. I created this guide a couple of years ago, but I recently changed the Theory of Change framework I use with my clients. I used to follow a more traditional logic model approach, but over time I’ve come to realize that there are really five specific and complex questions that make up a Theory of Change.

And those are:

  1. What is the target population or populations you are seeking to benefit or influence?
  2. What relevant trends in or changes to the external environment are occurring?
  3. How and where are your core competencies employed?
  4. What changed conditions do you believe will result from your activities?
  5. What evidence do you have that this theory will actually result in change?

The completely revised Design a Theory of Change Guide walks you step-by-step through answering these questions and creating your nonprofit’s own Theory of Change.

A Theory of Change is a fundamental building block to everything that your nonprofit does. Because without a Theory of Change, you won’t know what you are trying to accomplish, how you will get there, or whether you are moving towards it, and you certainly won’t attract the funding necessary to get there.

A Theory of Change can strengthen your nonprofit in many ways:

  • Guides your strategic planning process. If you understand your nonprofit’s overall Theory of Change and what you exist to do, it is much easier to chart a future course.

  • Helps revise the vision and mission of your organization, making them stronger and more compelling.

  • Gives a framework to prove whether you are actually achieving results and creating real social change.

  • Provides a filter for new opportunities as they arise. Do new opportunities fit within your Theory of Change?

  • Engages board members and other volunteers, friends and supporters in your work. If people understand the bigger picture, they will be more inclined to give more time, energy, and other resources to the work.

  • Allows staff to understand how their individual roles and responsibilities fit into the larger vision of the organization. This can increase staff morale, productivity, communication and overall commitment to the organization.

  • Provides the basic argument for a case for investment or other fundraising messaging. With a Theory of Change, you can articulate what you are working to achieve, in a compelling way.

A Theory of Change is so fundamental because you cannot chart a strategic direction if you don’t know what you are trying to change. And you can’t prove that you’ve changed something unless you have articulated what it is that you want to change in the first place. And you certainly can’t convince funders, volunteers, and key decision makers to support you if you can’t tell them what you are trying to change and whether you are actually doing it.

So to truly create long-term social change you must start with a Theory of Change, which is why I encourage every nonprofit engaged in social change to create one.

You can learn more about the Design a Theory of Change Guide and download a copy of it. If you downloaded the previous Theory of Change Guide and would like the newly revised version free of charge, let me know, and we’ll send it to you.

As always, you can see all of the Social Velocity books, guides and webinars available for download on the Social Velocity Tools page.

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10 Most Popular Posts of 2014

typewriterThe year is winding down, and I will be taking some time off to enjoy friends and family (as I hope you are too). But before I go, I want to leave you with a list of the 10 most popular posts on the blog this year, in case you missed any of them.

And if you want to see the 10 most popular posts from 2011, 2012, or 2013 you can do that as well.

I feel incredibly lucky to be able to work with you amazing social change leaders. I am grateful for the amazing work you are doing to create a better world. And I appreciate you being part of the Social Velocity community.

I wish you all a happy, relaxing holiday season, and a wonderful new year. I’ll see you in 2015!

  1. Can We Move Beyond the Nonprofit Overhead Myth?

  2. 7 Rules For Brilliant Nonprofit Leaders

  3. How to Move Your Nonprofit Board From Fundraising to Financing

  4. Why Nonprofits Must Stop Being So Grateful

  5. 5 Questions Every Nonprofit Leader Should Ask

  6. Why Do Nonprofit Leaders Get In Their Own Way?

  7. 3 Questions to Get Your Nonprofit Board Engaged

  8. 5 Ways Great Strategy Can Transform a Nonprofit

  9. Does Your Nonprofit Know How To Attract Big Donors?

  10. It’s Time to Reinvent the Nonprofit Leader

Photo Credit: Steven Depolo

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Kick Your Nonprofit Succession Plan to the Curb

There is a lot of talk about succession planning in the nonprofit sector, but for the most part, it’s approached in the wrong way. The problem with traditional succession planning is that nonprofits take a too narrow view of nonprofit leadership. It’s not enough to have a strong nonprofit executive director or CEO and to create a “succession plan” to guard against their eventual departure. Instead nonprofits need to develop a new approach to leadership that brings many people together to drive strategy.

In order to have truly sustainable and effective leadership a nonprofit must integrate four key elements into the leadership of their organization:

  • An Empowered Executive Director or CEO
  • Emboldened Staff (beyond the nonprofit leader)
  • Invested External Stakeholders (funders, regulators, policy makers, collaborators)
  • Elevated Board of Directors

These four groups should each have a role to play in any strategic decision the organization makes, like this:

If you develop an integrated leadership model like this, the organization is not overly-reliant on any single element to keep it going. So in the worst case scenario if your executive director leaves tomorrow the organization would be able to continue on until a new executive director replaced her. Similarly, an integrated leadership model like this guards against the debilitating challenges that founder’s syndrome, or the over-reliance on one leader, can pose for a nonprofit.

In order to determine whether your nonprofit has an integrated leadership model, start by asking yourself these questions:

  • Does your staff feel comfortable speaking their mind at staff and board meetings?
  • If your executive director left tomorrow would your nonprofit survive?
  • Does your board get excited and engaged at most board meetings?
  • Do they have and express diverse viewpoints?
  • Do they drive the strategic direction of your organization?
  • Do you have a real strategic plan that drives the day-to-day work of the organization?
  • Do funders, board, stakeholders have relationships with staff members beyond just the executive director?

If you answered “No” to many of these questions, you may need to strengthen these four elements so that your nonprofit has a sustainable leadership model. How do you get there? You:

  • Create a groundbreaking board that focuses on strategy, not weeds, and structures itself for engagement.
  • Create and monitor a REAL strategic plan.
  • Evaluate the performance of the board and the Executive Director at least annually.
  • Conduct annual, anonymous 360 staff evaluations, where each staff member (including the ED) evaluates herself, any of her direct reports, and her supervisor.
  • Have staff contribute at board meetings and encourage their relationships with board and external stakeholders.
  • Make external stakeholders (funders, policy makers, influencers) a key part of your organization by including them in committees or meeting with them regularly to solicit thoughts and feedback.

The nonprofit organization of the 21st century must be led by a diverse and distributed army of people both inside and outside the organization. Relying on only one person to lead is setting the organization up for failure.

Photo Credit: stephclark

 

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The Problem with Strategic Planning

The term “strategic plan” has become so misused and abused in the nonprofit sector that it has almost become meaningless. So many organizations have undergone a poor strategic planning process. But the fact remains that to be truly effective at creating social change a nonprofit organization MUST have a strategy for the future and a plan for how they will get there.

There are some very clear ways that a good strategic plan differs from a poor one:

  • A good strategic plan starts from an in-depth understanding of the outside community marketplace in which the nonprofit operates (trends in clients, funders, competitors, etc). Whereas a bad strategic plan is created in a vacuum among only board and staff. One nonprofit told me that at a board retreat years ago, board members were asked to write their goals for the organization on post-it notes, which were then tacked all over the room and voted on. And like that, their  strategic plan was born.

  • A good strategic plan forces the organization to articulate its value proposition, i.e. how the organization uniquely uses community inputs to create significant social value (change to a social problem). A poor strategic plan fails to articulate a value proposition and assumes that everyone outside the organization loves it and understands its value just as much as everyone inside the organization.

  • A good strategic plan puts everything on the table and allows no sacred cows. Board members with pet interests are reigned in and staff members who are not contributing are encouraged to realign themselves with the new plan. A poor strategic plan only deals with the easy or non-controversial issues and leaves the difficult questions aside.

  • A good strategic plan makes sure that the strategy for programs is aligned with the organization’s business and financial model so that the resulting strategic plan includes programs, financing and operations in an integrated way. A poor strategic plan focuses only on programs and assumes that the money will somehow follow.

  • A good strategic plan includes a tactical plan so that the broad goals are broken down into individual steps to get there. This allows the organization to monitor and revise the plan on an on-going basis. A poor strategic plan has no tactical plan or monitoring system attached to it. Once approved, staff or board don’t see it again and it certainly doesn’t drive the day-to-day activity of the organization.

  • A good strategic plan is inspiring and compelling to potential funders. It sets forth a bold vision for the future and a specific road map for getting there, which inspires confidence and investment. A poor strategic plan is boring, maintains the status quo, and elicits only nominal external support.

It’s not enough to go through the “strategy” motions. A real strategic plan is bold, compelling, tactical, well-financed, integrated and inspiring. It gets everyone (staff, board, funders, volunteers, clients) moving forward in a common direction from which real change flows.

If you want to learn more about the strategic planning process I take Social Velocity clients through, go here.

Photo Credit: HikingArtist.com

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