Strategic Planning

AFP Mid-America ConferenceMay 3, 2010

Topics We Will Cover

• What strategic planning is – and is NOT

• When – and when NOT – to plan

• Three sample planning approaches

• Strategic planning process

• War stories – “planning gone wild!”

What are your impressions of & experiences with strategic

planning?

Strategic Planning Is:

• Long-term (typically 3-5 years)• Both aspirational and achievable• Both externally and internally focused• Leadership-driven• Consensus-based• Recorded using a computer – not carved in

stone• How your board and executives should evaluate

performance

Strategic Planning is NOT a Document!

Most times are a good time to engage in strategic planning

Exceptions

(delay planning):

• Impending executive turnover or no current executive

• Board instability• Financial instability• Media scrutiny/scandal• Significant board-CEO

tension

The key exception is when an organization is in crisis.

What constitutes a crisis?

Three Strategic Planning Approaches

• Peter Drucker

• Amherst Wilder

• Strategic Change Cycle

Peter Drucker FoundationFeatures: The Drucker Model is essentially a business model for planning applied to address the unique

features of public sector organizations. It presents the five most important questions any nonprofit organization must ask: What is our mission? Who is our customer? What does our customer value? What are our results? What is our plan? The planning model seeks to address the planning process at every stage in the context of the what the mission of the organization is and what it should be. It seeks to identify primary customers (those whose lives are changed by the work) and supporting customers (volunteers, partners, donors, and others who must be satisfied). The resulting product is a listing of goals and measurable objectives.

Benefits: The Drucker Model focuses on results - keeping the “bottom line” of changed lives as its key element of organizational success. It seeks to establish clear measures of commitment and competence and targets performance standards as a measure of success. The “business management” orientation of the model is easy for many volunteer leaders to grasp as it often relates to their business orientation in their professional lives.

Cautions: The model spends limited time on analysis of organizational realities of many nonprofit organizations. While highlighting the customer, it lacks formal analysis of the strengths, weaknesses, opportunities, and threats of an organization. Critics of the model believe that the intense focus on the customer fails to allow planners to go outside the model to seek creative solutions to unmet needs.

Amherst Wilder FoundationFeatures: The Amherst Wilder Foundation planning approach was developed and recognized as one of the first

comprehensive planning processes uniquely tailored for public sector organizations. Taken from corporate business planning models that have been in use for over two decades, the model addresses the management processes necessary for organizational survival. The process is very detailed with structured formats provided for each element of the planning process. The outcome report is very detailed and connects fiscal and program resources to detailed operational elements of the plan.

Benefits: The planning process is very thorough, concentrating on development of organizational readiness, taking stock of current climate and future issues identification, offers multiple planning approaches, and a process to evaluate and refine the plan once it is in place. The process offers three different strategies which can be used to approach the plan. These include the scenario approach where planning participants develop possible scenarios based on identified issues and structure a plan of action to meet an agree-upon scene of the future; the critical issues approach where planning participants address planning from the perspective of each identified critical issue identified addressing key actions, finances, and administrative needs necessary to meet these issues; and goal approach which seeks to have participants set a few key goals that they seek to achieve along with strategies to get them to these goals.

Cautions: The Amherst Wilder Model for strategic planning is often criticized because of its strong attention to detail. Critics identify these types of plans as the ones that end up in a drawer only drug out every three years when it's planning time. The elements of the planning process are valuable; however, the resulting plans often are so detailed as to appear prohibitive for management to implement. The process requires a detailed assessment and redesign process many organizations are unable to fit into their ongoing work, resulting in an out-of-date plan with little prospect of providing leadership and direction for the organization.

Strategic Change Cycle ModelFeatures: The ten-step process developed by Bryson provides a thorough sequential process to complete

organizational assessment and a quality strategic plan. Its key uniqueness is its connection of the mission to organizational mandates, making this model especially effective with organizations that deliver services and products heavily subscribed with governmental resources (health care, youth services covered by Medicaid or Medicaid waiver, etc.). The plan development process is simple and straightforward, with the outcome of the plan providing maximum room for ongoing assessment and adjustment of strategies based on emerging issues and needs.

Benefits: The key benefit of the planning process is its flexibility. It allows organizations to come into the planning process at whatever stage they are in their organizational maturity. The process is easily adaptable for organizations both big and small and allows for the development of the level of planning detail that is comfortable for the organization to implement. It offers maximum stakeholder participation and spends significant time on identifying and assessing stakeholders' needs and wishes. The resulting plan development is detailed enough to set the course for an organization yet has flexibility to allow for ongoing modification based on emerging issues.

Cautions: The planning process is heavily weighted with organizational mandates as a precursor to mission development. This can have an effect of lessening the sense of vision and innovativeness in meeting the needs of the target populations to be served. A strong facilitator is needed to assure that mission and vision is not weighted too heavily by the regulatory burdens which are often a consideration of nonprofit organizations attempting to do good work.

Sample Strategic Planning Process

• Initial prospective client meeting – preferably w/board chair and CEO

• Phone interviews w/board members and other stakeholders

• Planning retreat w/board and CEO• Written plan• Work with CEO & managers on annual work

plans• 6-month follow-up with board chair & CEO

Strategic Planning“War Stories”

Conclusion

• Strategic planning is a process, not an event, giving leadership the opportunity to assess the present and plan for the future

• There are many ways to plan strategically

• There are times NOT to plan

• “Begin with the end in mind”

Thank You!

818 S. Hawthorne Avenue

Sioux Falls, South Dakota 57104-4537

(605) 336-0244 or (888) 4-SUMPTION

www.sumptionandwyland.com