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IMPORTANCE OF STRATEGIC PLANNING IN NON-PROFIT ORGANIZATIONS
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By Scott Prentice, CPA, CFE - Manager
Strategic planning is commonly defined as an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy. In order to determine the direction of the organization, it is necessary to understand its current position and the possible avenues through which it can pursue a particular course of action. Strategic plans can incorporate goals over the next year or the next five years. Some believe that strategic planning is not vital for a non-profit; however, a non-profit must think ahead and strategically in order to sustain itself and grow.
In March 2012, a national survey was conducted by the Association for Strategic Planning (ASP) and the University of Arkansas Department of Political Science. The survey focused on successful strategic planning practices for non-profit organizations. Initial findings of the 1000+ responses were reported during the May 2012 ASP Annual Conference. These findings included the following three items of significant interest to advocates for the strategic planning process in the nonprofit sector:
- The driver for strategic planning in high success organizations is "Routine periodic process in our organization." Whereas in low success organizations, the driver for planning is "Driven by significant risks/challenges"
- Successful organizations report having successful plan implementation practices; low success organizations report that they do not have successful implementation practices. Thus, implementation and follow through are keys to success.
- Highly successful organizations report that strategic planning has high impact on overall organizational success. Low success organizations do not report strategic planning as key to overall organizational success.
The most useful tools for successful strategic planning include; SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats), defining desired performance outcomes, assessment of programs, and focus groups to name a few.
In today's economy it is extremely important for non-profits to devote time to strategic planning.
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