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  • Writer's pictureSheena Sullivan

Strategic Planning 101: A Step-by-Step Guide for Nonprofits




A strategic plan is a living document that keeps everyone — the staff, board, volunteers, and other stakeholders on the same page about the organization's major priorities.


This guide will unravel the enigma surrounding strategic plans, shed light on their importance, and equip you with actionable steps to develop your own.


Chess Board

If you lead a nonprofit or hope to, you've undoubtedly heard the term "strategic plans." Though the idea of strategic planning might seem complicated and daunting, it doesn't have to be. In this ultimate guide, I will demystify the concept of strategic plans, explain their significance, and provide you with practical steps to create one for your organization. By the end, you'll realize that crafting a strategic plan is an empowering and essential process for nonprofits of all sizes.



 

What is a strategic plan?


On the most basic level, strategic planning is setting long-term goals for the organization and creating action plans to achieve them. Thus, the strategic plan is a document resulting from the strategic planning process.


As a part of the goal-setting process, strategic planning also involves identifying or clarifying the organization's mission, vision, and values and analyzing its internal strengths and weaknesses, external opportunities and threats, and the nonprofit's broader landscape.


You can think of your strategic plan as a roadmap to reach the organization’s future vision. When developing your plan, there’s no way you could know all the possibilities and challenges your organization will face over the next three to five years. Thus, your strategic plan will change as you gather information along your journey to the organizational vision.



Do nonprofits need strategic plans?


Research has shown that strategic planning significantly benefits nonprofit organizations. It plays a crucial role in developing adaptability to environmental changes, enhancing organizational decision-making processes, and prioritizing development initiatives.


While organizations often engage in formal strategic planning because a funder requires it, its impact extends well beyond potential funding benefits. Implementing strategic planning can trigger positive changes in a nonprofit's mission, structure, board, and management roles. The top three benefits of strategic planning, based on my experience, are:


  1. Unity of Purpose: Strategic planning aligns all key players, including the board, staff, volunteers, and other stakeholders, towards a common goal. By charting a clear and well-defined course, strategic planning ensures everyone is on the same page, working harmoniously to achieve the organization's mission and vision.

  2. Enhanced Oversight: The strategic planning process provides the board with a valuable lens through which they can effectively oversee the work of the executive director and the entire staff. It creates a structured framework to evaluate the organization's progress, ensuring it remains on track and aligned with the strategic objectives.

  3. Focus on Long-Term Objectives: Amidst the daily hustle and bustle of managing the organization, it's easy for the executive director to become entangled in day-to-day operations. Strategic planning acts as a guiding system that empowers the director to concentrate on the big-picture, measurable goals and the overall mission. By outlining a roadmap of strategic priorities, the director can dedicate efforts to crucial aspects that drive the organization's long-term growth and impact.


Overall, strategic planning is a valuable tool that can empower your organization to thrive in a dynamic environment, achieve your goals more effectively, and strengthen your impact on your communities.



Common Mistakes in Nonprofit Strategic Planning


The strategic planning process doesn't have to be overly complex, but there are some common slip-ups to be aware of. Here are twelve of the most common mistakes:


Mistake 1: Lack of Inclusivity. Failing to involve key stakeholders, such as board members, staff, volunteers, beneficiaries, and community partners, can result in a plan that lacks diverse perspectives and buy-in from those essential to its successful implementation.


Mistake 2: Neglecting Data and Research. Strategic plans should be based on thorough data analysis and research. Skipping this step can lead to uninformed decisions and unrealistic goals.


Mistake 3: Setting Unrealistic Goals. Establishing overly ambitious or unachievable goals can lead to frustration and demotivation among stakeholders when expectations are unmet.


Mistake 4: Ignoring Implementation Challenges. Failing to consider the resources, capacity, and expertise required for plan execution can lead to difficulties in achieving goals and objectives.


Mistake 5: Neglecting Communication and Transparency. Not communicating the strategic plan clearly to all stakeholders or being transparent about the decision-making process can result in confusion and resistance to the plan.


Mistake 6: Overlooking External Factors. Neglecting to consider external factors, such as changes in the nonprofit sector, economic conditions, or shifts in community needs, can render the plan obsolete or less effective over time.


Mistake 7: Disregarding Organizational Culture. A strategic plan that does not align with the organization's culture and values may encounter resistance from staff and hinder successful implementation.


Mistake 8: Focusing Solely on Fundraising. While fundraising is essential, concentrating solely on financial goals can overshadow other critical aspects of the nonprofit's mission and impact.


Mistake 9: Neglecting Evaluation and Review. Failing to establish a system for monitoring progress and evaluating the plan's effectiveness can prevent the organization from learning, adapting, and improving its strategies.


Mistake 10: Adopting a Static Approach. Viewing the strategic plan as set in stone rather than a living document can limit the organization's ability to adapt to changing circumstances.


Mistake 11: Relying on a Consultant Alone. While consultants can provide valuable expertise, relying solely on external consultants without involving internal stakeholders can result in a lack of ownership and commitment to the plan.


Mistake 12: Inadequate Resources for Planning. Allocating insufficient time, budget, or human resources to the planning process can lead to rushed or incomplete strategic plans.


To avoid these mistakes, nonprofits should invest time in thorough planning, involve diverse stakeholders, and maintain a flexible approach considering internal and external dynamics.


Reviewing and updating the strategic plan can also help address emerging challenges and opportunities effectively.



Building a Strategic Planning Committee


The nonprofit strategic planning team should include diverse stakeholders interested in the organization's success who can provide valuable insights. This ensures that the strategic plan is well-informed, aligned with the organization's mission, and supported by those responsible for implementation. Your strategic planning committee members could include the following:

  • Nonprofit Board of Directors: The board plays a crucial role in setting the organization's direction and ensuring the plan aligns with its mission and values.

  • Executive Leadership Team: Senior leaders, including the executive director or CEO, bring expertise to develop realistic and achievable strategies.

  • Staff Members: Involving team members from different departments ensures the plan reflects the collective wisdom and expertise of the organization's operational workforce.

  • Volunteers: Volunteers offer unique perspectives and experiences, especially regarding beneficiaries and community needs.

  • Donors and Funders: Engaging major donors and funders helps align the plan with their priorities and may increase funding opportunities.

  • Beneficiaries and Service Users: Involving representatives of the communities served provides insights into their needs and preferences.

  • Experts or Consultants: External experts or consultants contribute objectivity and best practices to the process.

  • Community Partners: Collaborating with other nonprofit organizations, government agencies, or community groups strengthens the overall impact.


Inclusive and collaborative engagement of stakeholders fosters open communication and leads to a more comprehensive and effective strategic plan for the nonprofit organization.


If your organization is new and you’re creating your first strategic plan, your committee will likely only include a few people. At a minimum, the founder and board chair should work together to determine the organization’s goals, then solicit and implement feedback from the rest of the board and any key stakeholders.



Step-by-Step Strategic Planning Process



Developing a strategic plan for a nonprofit involves a systematic and comprehensive process to set clear goals, define strategies, and allocate resources to achieve the organization's mission effectively.



There are several strategic planning models, but the best approach is one that works for you and your organization. If you plan carefully, avoid the common pitfalls discussed above, and create a realistic plan for your organization, you can’t go wrong. You can always adjust your plan as you gather more information and pursue your strategic goals.


The following steps outline a typical process for developing a strategic plan:


Step 1. Mission and Vision: Form, reaffirm, or revise the organization's purpose (mission statement) and the desired future state (vision statement) it aims to achieve.


Step 2. SWOT Analysis: Conduct a comprehensive analysis of the organization's internal strengths and weaknesses and external opportunities and threats in the operating environment.


Step 3. Goal Setting: Establish specific, measurable, achievable, relevant, and time-bound (SMART) goals aligned with the mission and vision. Typically, you’ll want to stick to 3-5 specific goals for the coming years.


Step 4. Strategy Formulation: Develop strategies and an action plan to achieve goals with a clear timeline. These strategies should capitalize on the organization's strengths, address weaknesses, and take advantage of opportunities while mitigating threats.


Step 5. Resource Allocation: Identify the resources (financial, human, technological, etc.) required to implement the strategies effectively.


Step 6. Implementation: Put the strategic plan into action and assign responsibilities to individuals or teams for various tasks and initiatives.


Step 7. Communication: Engage stakeholders, including board members, staff, volunteers, donors, and the community, to ensure alignment and support for the strategic plan.


Step 8. Monitoring and Evaluation: Regularly measure progress toward achieving the goals and make necessary adjustments to the plan. This step ensures the organization stays on track and learns from its experiences.


The strategic planning process helps nonprofit organizations become more focused, efficient, and effective in pursuing their missions. It also allows them to respond to changes in the external environment and adapt to new challenges and opportunities. By having a clear strategic direction, nonprofits can make better decisions and allocate resources to maximize their impact and bring them closer to their ultimate vision.



Key Insights


This article explored what a strategic plan entails, why it matters, and how to create one. Your strategic plan will be a living document that evolves as your organization gathers information along its journey toward its vision. It will act as your roadmap, guiding you toward your desired destination, even when facing detours and unexpected adventures. The benefits of strategic planning for nonprofits are numerous, ranging from developing adaptability to enhancing decision-making and fostering teamwork.


You might already know nonprofits often undertake strategic planning to meet funder requirements, but its positive impact goes beyond just funding benefits. The process can initiate positive changes in your mission, structure, board, and management roles. By fostering a strategic mindset, providing clarity on your organization's direction, and improving overall performance, strategic planning empowers nonprofits like yours to thrive in a dynamic environment and significantly impact communities.


However, be aware that the strategic planning process can be complex, and you should be cautious to avoid common mistakes. Inclusivity is paramount, involving key stakeholders such as your board members, staff, volunteers, beneficiaries, and community partners. Neglecting data and research, setting unrealistic goals, and overlooking implementation challenges can hinder successful strategic planning. Open communication, transparency, and consideration of external factors are essential for effective plans that adapt to changing circumstances. Avoid a rigid approach and prioritize evaluation and review to ensure continuous improvement.


In conclusion, strategic planning is vital for guiding you toward your goals and strengthening your impact on the communities you serve. Developing and implementing a strategic plan with inclusivity, flexibility, and careful consideration allows you to chart a course toward success and fulfill your mission effectively.


Need help with your strategic plan? Contact me to set up a consultation.

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