Strategy Development is a Process, Not a Retreat

Part I

Strategy development is an ongoing process, not something that occurs every three years. Yes, a strategy development retreat is a critical component of a healthy organization and a necessary element of nonprofit strategy development, but developing good strategy requires thinking strategically at every turn (strategic thinking culture) and an ongoing, institutionalized strategy development process.

A comprehensive strategy development process consists of many components. Utilizing the components throughout the year will ensure solid market position awareness, contribute to the development of good strategy and build the strategic capacity of the organization. The component outcomes can then be fed into the strategy development retreat. Ultimately, the goal is to continually have your hand on the pulse of the market to ensure market awareness and make strategy adjustments, as appropriate, along the way.

The following are some of the components of a strategy development process:

Core Ideology (CI) Development: “Core ideology defines an organization’s enduring character.”[i] Understanding your organization’s identity is paramount to good strategy development. Core ideology is comprised of the organization’s values and purpose. Values are the guiding principles of an organization; they are timeless. A core purpose is stated in one succinct sentence and defines the organizations reason for being. Significant time and input go into the development of core ideology; however, if properly developed, core ideology can last for a hundred years. Core ideology is not regularly reviewed, but it is regularly referred to as a north star when developing strategy and making strategic (and operational) decisions. If you don’t have a core ideology, you might want to consider forming a task force to develop one.

Mission: A mission statement defines what an organization is presently. It identifies the organization’s customers and the critical processes used by the organization, and defines the level of expected performance. Although a copy of the mission statement should be included in every board meeting briefing book, as part of the strategy development process, mission statements are typically reviewed every three years. However, significant events can create the need to update the mission during such 3-year period. As part of a typical review, your mission statement may need to be revised if it seems that your organization’s actions aren’t correlated with the mission or the organization’s board / constituents believe the organization needs to go in a different direction. Further, an organization’s life cycle stage may warrant mission statement revision. It is suggested that a board task force be created to undertake an in-depth mission statement review and present options for revisions to full the Board for dialogue and discussion.

Stakeholder audit: With the amount of disruption in today’s business environment, it is suggested that a stakeholder audit be undertaken on an annual basis. Stakeholder audits are composed of stakeholder identification and analysis. Stakeholders are defined as anyone or any organization that could be affected by or that could influence your organization or its outcomes. It is important to understand stakeholder needs and issues, and the degree of potential influence stakeholders hold. Likewise, it is important to define what your organization wants from the stakeholder groups. Again, a task force can be created to conduct a stakeholder audit. It is important the care is given to create an optimally diverse task force and it is also often helpful to use a professional facilitator to conduct the audit session.

Environmental Scanning: Formal analytical environmental scanning should take place throughout the year in order to continually understand your current operating environment and market for the purpose of anticipating changes in a timely manner. This is best undertaken by creating an environmental scanning framework and by dividing the data collection duties amongst staff. A common framework that is used for scanning the external environment focuses on social / demographic, technological, environmental, economic and political categories. In addition, social intuitive scanning often takes place at a strategy development retreat.

Competitor Analysis: Organizations should regularly (every quarter or six months) analyze their competition to ensure that they have a clear and current understanding of the market place. In analyzing competitors, the focus should be on key areas that are important to your organization’s success, such as members, customers, human resources (staff and volunteers), media publicity, funding, programs and services and advocacy voice. Typically, organizations analyze and compare themselves to their top three toughest competitors. Competitors are considered entities that compete on the key areas important to an organization’s success. The analysis consists of evaluating what makes the competitors strong in each of the key areas as well as your organization.

Competitive Advantages: “Nonprofit competitive advantage is a nonprofit’s ability to sustainably produce social [or member] value using a unique asset, outstanding execution, or both.”[ii] An organization’s competitive advantages are what powerfully differentiate it from its competitors. They are determined, in part, by conducting a competitor analysis. It is important that organizations understand their competitive advantages prior to engaging in strategy development, as competitive advantages can be wisely used to inform strategy. In today’s rapidly changing environment and the onslaught of disruptors, it is suggested that competitive advantages are reviewed and challenged every year and more frequently is a competitor analysis surfaces a need to do so.

[i] Jim Collins  [ii] David L Piana

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