January 16, 2023
One of the challenges in strategy development is that there are no fixed definitions of the fundamental concepts of strategy. Consequently, key terms are used interchangeably (or worse, randomly), thereby draining them of their value in shaping strategic thinking. For the purposes of this article, let’s agree on a vocabulary for the fundamental elements of nonprofit strategy. Consider these:
The vision, by definition, extends beyond the scope of your organization. Its value is in clarifying the scope of the role your organization will play and the difference you hope to make. We refer this as the mission.
Which brings us to strategy. In simple terms, strategy is about how you will use your available resources to enact the mission. Being strategic requires choices about who you will serve, what you will do for them, and how you will differentiate yourself, among other things.
The central paradox of strategy is that while it is aimed at creating the greatest mission impact, it is also true that mission does not drive strategy. If it did, the purpose of strategy development would be to identify everything that can be done to advance the mission. But strategy moves in the opposite direction. To quote Michael Porter, the essence of strategy is deciding what you will not do to meet your mission.
Consequently, mission is not a filter for strategic decisions. This occurs when program and decisions are made based solely on how well something “fits the mission”. But the mission was not designed to bear this much load. Consider the mission example above. On what basis would you decide what not to do if your aim is to prepare people to deal with conflict in everyday life? We need something more.
Staying In Your Strategy Lane
To be clear, mission plays a vital role in setting nonprofit strategy. But that role is limited: mission provides the context for strategy. Think of mission as the swimming pool you have chosen to enter. The first thing you will notice is that the pool is crowded with others whose purposes are similar to yours. Developing strategy – determining how you believe your organization can contribute to this greater purpose – is your way of defining the lane in which your will swim.
To illustrate the value of lanes, suppose that your youth-focused conflict resolution training in the example above is so successful that you are approached by the city about establishing a fully funded community-based conflict resolution center to handle workplace, family, and civic conflict. Would you do it? Should you do it?
Returning to the mission statement, the initiative can easily be justified. Afterall, how better to prepare people to deal with conflict in everyday life than by opening a community conflict resolution center. Therefore, we can say with confidence that we have cleared the first hurdle, which is that it does, indeed, fit the mission.
But not so fast, my friends. Mission fit is necessary but not sufficient. There are two more hurdles that need to be cleared before moving forward with planning for the new project. They are represented by the two questions below.
Question 1: Will the initiative keep us in our strategy lane?
Question 2: Is this the right time for us?
The answer to the first question is a resounding ‘no’. The development of a community-based center, while potentially touching youth, is not aimed primarily at youth. Therefore, taking on this new initiative may keep the organization on mission, but it takes them out of their strategy lane.
The fact that it is fully funded is…wait for it…beside the point. As my parents taught me, just because you can do something does not mean you should. Though tempting from a financial standpoint, the community center creates no strategic value for the organization. (Jumping out of your lane just to keep your doors open is not a strategy. It is a crisis response, which is by nature the product of short-term thinking. Strategy is about the long-term.)
Even if the project could be justified strategically (for example, the center will work primarily with youth), there is the question of timing. A successful initiative results from a confluence of the right opportunity, for the right organization, at the right time. Everything takes time and even fully funded programs require operating support. If the addition of a new program will take time, effort, or funding away from existing core programs, the net strategic value is neutral at best.
Is it ever strategically sound to swim outside of your lane? Sure, but it depends on a number of other factors. For example, an initiative may provide ancillary benefits to your organization, such as introducing you to a new collaborative partner or funder. As a one-off opportunity, an initiative may allow your organization to explore a new area of service with minimal risk.
In the end, strategy is about consistency, not purity. The point is that leaving your strategy lane is not to be taken lightly. Viewing opportunities from within your strategy lane will keep the organization focused on where it is needed most and what it does best, while resisting the temptation to satisfy a CEO’s restlessness or chase a few dollars.
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