Ah-Ha Moments in Strategic Planning with Non-Profit versus For-Profit

Recently, I had the opportunity to facilitate AJC’s Strategic Deployment / Prioritization Matrix and Implementation Plan process for a non-profit.  This process aligns Strategy and Execution for organizations using the classic Hoshin Kanri (Strategy Deployment Matrix), coupled with the AJC-specific tools: Prioritization Matrix and Implementation Plan template, and was originally published in this article.  

A Family For Every Child is a nonprofit organization focused on finding permanent and loving adoptive homes for waiting Foster children, specializing in assisting special-needs/challenging-to-place foster children in finding their own Forever Families.  It was a true privilege to help this organization, with it’s amazing focus on children, align their 3-year strategic goals with action to begin today.  There were many key learnings on my part, however, in how performing this process differs for a non-profit versus a for-profit business.  AJC is now working with another non-profit, and is seeing this pattern emerge again.  Here are three differences that I’ve seen so far, summarized as: Drive, Data, Dollars.

Drive

Many US workers suffer from lack of engagement, up to 51% in this freely available 2015 Gallup poll release.  The same release stated that only 32% of employees self-report as “engaged.”  This is actually also a problem in non-profits, but according to the statistics cited from Quantum Workforce for 2015, 58% of employees in non-profits were engaged.  While 58% is not a staggeringly high majority, it still is almost double that of “all” workers, and sets the tone for this difference seen in for-profit and non-profit Strategic Alignment work.  I often refer clients to Simon Sinek’s 2010 Ted Talk “How Great Leaders Inspire Action” before conducting the Strategy Deployment sessions, or at least start with the CEO/leader’s “Why.”  It is often helpful to the entire Leadership Team to hear why the company owner/founder/top executive wants to improve, and that sets the stage for everyone to enthusiastically embrace the goal setting and planning work to be done.

In the case of non-profit work, however, the “why” is typically quite clear – that is, after all, the mission or vision that the non-profit purports to the world in general.  The people in the leadership and managerial teams at non-profits are aligned to this sense of purpose, and feel driven by it.  While there can always be stronger alignment to a clear purpose, it does not seem quite as relevant to spend as much time motivating the team in this area as there is in a for-profit business.

Data

For all the drive in the world, however, it has so far been my experience that non-profits may suffer from the lack of clear data presented in a format that intuitively fosters understanding.  Pareto charts, funnel statistics, financial metrics, or even number of people served and some quantitative impact the non-profit is having on these people – this information is harder to tease out, and many people do not seem to have the engineering, statistical, and/or financial background to organically collect, compile, and communicate out this data and use it to drive programs, initiatives, or monitor success.  It was actually really fun to talk about how understanding “drop-off” percentages through the AFFEC workflow could help drive recruiting and retention of potential adoption families!  When explained using the simple tools of white board and pen, the team really seemed to understand what the data could show them, and expressed enthusiasm for wanting to start looking at data in that way going forward.  This is a place where analytical consultants may really be able to add value to non-profits, especially when the vision is clear and the team can agree on which metrics indicate success for the organization and its mission.

Dollars

This was probably my biggest tactical “ah-ha” when conducting the Strategy Deployment facilitation sessions in a non-profit, and one that I should have expected.  Other than wanting to increase their endowment in order to fund operating expenses, the non-profit world is not concerned with increasing financial revenue or dollars coming in!  Obviously, I’ve been operating in the for-profit sector so long that the basic concept of “making money” was so ingrained in my brain that I was caught a bit off guard when the 3-year and 1-year goals had nothing to do with money.  Clearly a learning for me, but possibly there could be a happy medium here.  After all, when Dan Palotta gave his Ted talk on “The Way We Think About Charity is Dead Wrong,” he discussed that there are some big gaps in financial incentive for good people to go into non-profits.  Also, money is often a good metric for accomplishment.  “Bang for the Buck” is a phrase that comes to mind.  In a non-profit more than a for-profit, it seems to me that one should consider the impact of work completed by limited resources.  A possible means to measure how much good the non-profit is doing given the expense of work done is in some kind of financial ratio.  Not sure what the right answer is, and my experience is admittedly quite limited!  However, it does seem reasonable that there is a place for Dollars to be considered, while not obsessively so, in non-profits. 

Conclusion

All in all, it was a great experience to work with A Family For Every Child, and continuing that with the new non-profit is rewarding as well.  Here’s hoping that for-profit and non-profit best practices can combine into harmonious best practices which are used effectively across the board to make this world will become a better place for all who inhabit it.

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