How to Know When Your Nonprofit is Ready for a Strategic Plan - and When it Needs Something Else.
At the start of the New Year, just as the clock struck 2022, many nonprofits decided they needed a strategic plan.
Or at least that’s how it felt! Beam Consulting received more requests for strategic plans in the past six months than it did in the previous three years combined – even before Covid.
And I can see why. Two years after a global pandemic derailed every organization’s plan, a large number of nonprofits were finally able to come up for air. And when they did, they immediately realized that the world was a different place. They needed a new guiding light, a new roadmap – a new plan.
When is the Right Time for a New Strategic Plan?
Handing your team a shiny new strategic plan creates clarity, not only of your collective mission, but of their place within it. Strategic plans inject energy, focus, and enthusiasm into the work you do.
Strategic plans aren’t silver bullets, though, and there are times when a new plan isn’t the best tool for moving your organization forward.
So, how do you know when a strategic plan is the right tool – and when it’s not?
At its core, a strategic plan is the right tool to answer questions like: ‘What’s next?”, “Where are we going?” and “How do we get there?”.
If you’re facing one of these challenges, your organization will likely benefit from a new strategic plan:
1. Old Ways of Doing Things No Longer Effect Change
When internal or external factors of your organization change substantially, the methods you deploy to achieve your goals almost always need to change, too. Strategic plans allow you to articulate your organization’s ‘theory of change.’ Ask yourself, ‘How will your efforts and activities work together to move your organization towards the outcomes necessary to achieve your mission?’ If your answer to that question is fuzzy, it’s time for a strategic plan.
2. Your Operating Model Leaves Money on the Table, Weakening Your Impact
Nonprofits must generate revenue to create impact and effect change. If, after an investigation of your operating model, you clearly see that your current revenue and program strategies are falling short, it’s time to seriously consider a strategic plan. A plan will shine a light on operations and how to shift the way you implement programs and generate revenue to increase your impact.
3. You’re Considering a New Opportunity or Evaluating an Unmet Community Need
This is the ‘opportunities’ section of a SWOT analysis that takes place during the strategic planning process. Working with a consultant to identify opportunities and decide if your organization should embrace them is a worthy reason for conducting a strategic plan.
4. You’re Considering a Capital Campaign, Merger, or Other Large Initiative
Before giving their ‘ok’ to undertake a big initiative, your stakeholders will want to know how the initiative moves the organization closer to achieving its long-term mission. A strategic plan shows your thorough and thoughtful consideration of the initiative and that you’ve done your due diligence to vet risks versus rewards.
5. You’ve Just Completed a Capital Campaign, Merger, or Other Large Initiative
Soon after completing a large initiative is another good time to update your strategic plan. Once you catch your breath, it’s time to ask: “Now what?”. A new strategic plan will help you celebrate and affirm past success and guide you as you embark on the next chapter of your organization’s journey.
A Strategic Plan is not a Band-Aid That Heals Deeply Rooted Internal Challenges
Strategic plans are one of our favorite tools for moving a nonprofit organization to the next level and closer to its mission. But when internal challenges are the weight holding back progress, those internal issues must be addressed first.
A strategic plan is not the right tool to solve these three organizational challenges:
1. Your Board is Low-Performing, Dysfunctional, or Both
It’s tempting to think that a low-performing board will begin performing at a high level once you present them with a strategic plan. But this is rarely the case. A better solution is a board governance expert who can help you shape your board into a high-functioning team. Then, after they learn how to work together and become the best version of themselves, you and they will be ready to begin the strategic planning process.
2. Your Culture is Toxic
An unhealthy culture, high staff turnover, low morale – strategic plans are simply not meant to solve these internal challenges. To attack these challenges head on, work with an organizational development expert who can shape a healthy culture with an effective team.
3. Your Staff Members Are Underperforming
Strategic plans shouldn’t be used to justify the termination of an underperforming employee. Don’t get me wrong – there are absolutely instances when it’s appropriate to revise your staff structure or job descriptions to better align your team with a new strategic plan. It’s not appropriate, however, to use that plan as an excuse to address long-standing performance issues. The better approach is to work with an HR professional to either develop ways to help your employees succeed or determine the proper pathway for termination.
“Imagine you have a splinter in your toe, and a doctor decides the best way to get rid of the splinter is to amputate your foot. Sure, the splinter isn’t a problem anymore, but now you have a bigger, more serious problem to contend with.”
Like that pesky splinter, I often see leaders of organizations hoping that their strategic plan will magically fix challenges rooted in team dynamics and performance. But when a strategic plan is deployed in these circumstances, leaders can exacerbate existing problems and create new ones.
Strategic Plans are Highly Effective Tools for Nonprofits When Used Correctly
Having the right tools for a job can make or break your success. A strategic plan is no different.
If you’re currently tackling some of these challenges and wondering if the time is right for a fresh strategic plan, my team and I are always here and available to help!
My best,
Dani
About The Author
For the past 25 years, Dani has helped nonprofits at local, regional, and global levels find sustainable solutions to tricky growth and funding issues. She works with leaders and teams to optimize their approach to fundraising, strategic planning, marketing, and more! Dani is passionate about helping motivated people build vibrant and effective nonprofit organizations—so they can make a meaningful impact in the world!