When is it Time for A New Strategic Plan?

Imagine this exchange between a nonprofit CEO and a strategy consultant:

CEO: “We need a strategic plan.”

Consultant: “Why do you need one now?”

CEO: “Because our current one expires at the end of the year.”

Let’s unpack this.

First, strategy does not come with an expiration date. Nor is progress toward a strategic vision always linear. Specific strategic initiatives may stall at times and accelerate other times. But there is no finish line when it comes to creating the most mission impact in the most sustainable manner.

Implementation plans, however, are created to expire. Some expire because all the tasks have been completed. Other plans expire as soon as they see the light of day because of unexpected changes in circumstances. In the words of Mike Tyson, the flight plan goes out the window the first time your opponent hits you in the mouth. Either way, it is important to recognize the difference between visioning and planning.

Second, strategic progress does not adhere to arbitrary planning cycles. Just because your current “plan” has a three-year time horizon does not mean that strategic progress will adhere to that arbitrary timeline. In fact, it is possible to accomplish everything on the plan and have no discernable progress toward the strategic vision that drove the planning.

If not the passing of time or internal cycles, what should drive formal strategic planning for nonprofits? The answer is that the focus and timing of formal strategic planning depends on the lifecycle stage of your organization.

Like humans, nonprofits advance through various stages of development (my go-to resource is Nonprofit Lifecycles: Stage-Based Wisdom for Nonprofit Capacity, by Susan Kenny Stevens). Advancement from one stage to the next is marked by the achievement of specific milestones. For example, a startup nonprofit that has reached full and quality implementation of its program model now faces a different set of questions that will help it manage growth. From there, the strategic focus is on finding equilibrium between aspirations, demand, and resources. Building on this foundation, the strategy of a mature organization is driven by long-term sustainability of key programs and services.

In short, the strategic needs of a nonprofit differ by organizational lifecycle. Achieving one set of strategic milestones introduces a new set of considerations that must be addressed to continue in its development. These milestone achievements are one indication that formal strategic planning may be in order.

But as we know, life doesn’t always unfold so smoothly or predictably. Progress toward strategic milestones sometimes is disrupted by unexpected circumstances. For example, an organization in the growth phase may lose a major funding source that forces it to make deep cuts in program budgets. Or a mature organization may need to undertake a major facilities renovation or risk losing client referrals. These disruptors are another indication that a formal strategy process is necessary.

An infographic showing organizational movement through the various phases of strategy, along with includes a list of milestones and sample disruptors for each phase, is available at strategybystone.com. Click on Resource Library and then Infographics.