The Strategic Planning Process

by Paul Sehmer, CPA

Over the years, I have had the privilege to serve on a number of nonprofit organizations' board of directors. If there is one central theme present in the successful organizations, it is the board's dedication and adherence to establishing and maintaining its strategic plan. In this month's edition of the Not-for-Profit e-Newsletter, I would like to touch on what I see as essential components of a strategic plan and share some of my experiences in establishing a plan.

First of all, what exactly is a strategic plan? Strategic planning can be defined as an organization's process of defining its strategy or direction, and making decisions on allocating its resources to pursue this direction, including its capital and people. A strategic plan is forward-thinking and attempts to clearly define:

1) What do we do?

2) For whom do we do it?

3) How do we excel?

A plan not only looks at its upcoming year of operations but in many cases it looks 3, 5, 10 or sometimes 20 years out. It has been my experience that many organizations develop a comprehensive plan that covers a period of three to five years. The key factor to keep in mind with any strategic plan is to realize that the plan is a living document that needs to be revisited and modified throughout its life. The common practice I tend to see is an annual update to an organization's strategic plan that extends the plan's life one or two more years out.

Secondly, how does an organization go about establishing its strategic plan? As stated in my earlier comments, strategic planning is a process. Successful organizations begin this process by clearly defining its mission, vision and core values. When all members of an organization's board of directors and strategic leaders are on the same page when it comes to its mission, vision and values, the likelihood that the strategic plan will be successful is much greater. For instance, I recently participated in the development of a strategic plan for an educational institution that began with the strategic leaders (i.e. the CEO, CFO and the schools' principals) putting into words the organization's mission, vision and values. If the organization's board of directors and other key stakeholders were not given the opportunity to provide feedback to these leaders, the organization could have easily gone down a path that would be in conflict with those that provide support to the organization as well as the students and parents that they serve.

The next step in establishing a strategic plan is to set up a strategic planning committee consisting of several board members, the organization's strategic leaders, and possibly an outside consultant that serves as the team's facilitator.   Whether an organization uses an outside facilitator or someone within the organization, the important thing to remember is to use an effective and experienced facilitator to keep the team on task. Once the strategic team has developed a draft of its written plan, it is highly recommended to bring the team and the organization's board of directors together for a full day to review the comprehensive plan and to strategize on how to effectively implement, maintain and monitor the plan.

In conclusion, the strategic planning process is an essential element of ensuring the success of a nonprofit organization's ability to meet its goals in fulfilling its mission. By bringing the strategic leaders, board of directors and key stakeholders together in developing this plan, the organization ensures that its vision stays on course while sticking to its values.   

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