Traditional strategic planning requires not-for-profit leaders to perform a lot of guesswork about what might happen in the future. This approach also asks decision-makers to explicitly shut down options and possibilities. Real-time strategic planning (RTSP) is a more flexible approach. It enables nonprofits to identify, understand and act on today’s challenges and opportunities.
A Coordinated Set of Actions
RTSP was first introduced by nonprofit consultant David La Piana in The Nonprofit Strategy Revolution: Real-Time Strategic Planning in a Rapid-Response World. According to La Piana, RTSP is “a coordinated set of actions designed to create and sustain a competitive advantage.” A successful plan requires organizational, programmatic and operational strategies and uses four building blocks of strategy formation.
The first building block is identity. RTSP is rooted in a firm and honest understanding of your organization’s identity. What is your mission and impact? What do you do, where and for whom? And how do you pay for it?
Competitive advantage is the second. What strengths do you leverage to differentiate your nonprofit from others and compete effectively for resources and clients? Analyze other organizations in the same geographic area that offer similar programs, to similar constituents, with similar funding sources.
The third is decision-making. Develop a “strategy screen” composed of the criteria you’ll use to choose strategies or courses of action. A strategy screen might consider, for example, whether an option advances your mission and enhances its competitive advantage as well as whether you can carry it out and pay for it.
The last is strategic questions. You need to differentiate operational questions (for example, “Will we be able to hire more employees to do this?”) from strategic questions (“What are the implications for our mission?”).
Important Component of Strategic Planning
La Piana identifies competitive advantage as perhaps the most important component. Competitive advantage must be something clients and funders value — for instance, a unique asset or strength. This can be a better program design leading to better outcomes or powerful partnerships and a well-connected board of directors.
Execution is also critical. Examples of execution advantages include lower costs to funders or customers, greater efficiency per dollar spent, faster delivery of programs or services, or better accountability and public reporting.
To make comparative judgments, you further need to identify and understand your competitors and their strengths. In the nonprofit arena, “competitors” often are collaborative partners. However, you likely compete with them for donors, media coverage, board members, employees, volunteers and clients.
Take a Look
If your current strategic plan seems ineffective or uninspiring, take a look at RTSP. Contact us for help assessing your organization’s financial position and competitive advantages.
© 2022
Director
HW Nonprofit Advisors
helen.weeber@hwco.cpa
