Strategic Thinking in Non-Profit Corporations

1. Strategic Thinking in Non-Profit Corporations Mark A. Ewer MSW RSW

2. Strategic Thinking in Non-Profit Corporations • 1. Corporate “Genesis” – Letters Patent, Objects, Bylaws • 2. Guiding Statements – Vision, Values, Mission • 3. Strategic Thinking vs. Strategic Planning • 4. Annual Planning • 5. Planning Considerations – CCAS of Hamilton • 6. Putting Planning in its Place • 7. Questions

3. Corporate Genesis (beginnings!) • Non-Profits that incorporate provincially, are regulated by The Corporations Act (Ontario). They are created by filing, and having approved, the proposed Corporation’s “Letters Patent”. These can subsequently be amended by filing “Supplementary Letters Patent”.

4. The Objects of a non-profit called the Hamilton Family Network

5. Bylaws • Bylaws are the “rules of governance” for a Corporation; they define the membership, the operating structure of the board of directors, the Officers, the role of the “senior staff person” and requirements concerning the financial affairs and records of the organization. • Bylaws can be amended from time to time by the board but must be approved by the “membership”.

6. 2. Guiding Statements – Vision, Values, Mission

9. 3. Strategic Thinking vs. Strategic Planning Strategic Thinking(skillful planning and managing) a) Management Direction • do we operate in a way that mitigates risks to the organization? • does everyone know what they are doing (and why)? b) Relevance • do our activities continue to make sense in terms of the conditions, needs or problems to which they are intended to respond?

10. 3. Strategic Thinking vs. Strategic Planning Strategic Thinking c) Appropriateness • what choices have been made between alternative means used to respond to the conditions, needs or problems of those served? • are the investments in people, programs, technology, facilities in the right balance, under the circumstances d) Achievement of Intended Results • what are our results, against performance standards, for the whole organization? (an approximate estimate of an accurate indicator is better than an accurate estimation of an irrelevant one!)

11. 3. Strategic Thinking vs. Strategic Planning Strategic Thinking e) Acceptance • do we have an acceptable level of public or customer/client respect, loyalty, recognition and trust? f) Secondary Impacts • what unintended impacts (positive and negative) are occurring as a result of our work (health and safety, environment, community) and should this cause reconsideration in any areas of operation?

12. 3. Strategic Thinking vs. Strategic Planning Strategic Thinking g) Cost and Productivity • are we using our resources to their best advantage? • should there be current or future “investments” that will have a longer term benefit? h) Responsiveness • How well are we anticipating and responding to change? • Have we planned for the future in terms of leadership, staffing. product/service development and crisis management?

13. 3. Strategic Thinking vs. Strategic Planning Strategic Thinking i) Financial Results • How good are the financial results in terms of matching costs with revenues and financial assets with anticipated obligations? j) Working Environment • Is there a happy, healthy and constructive working environment where staff are motivated to work together, adapt to change, and to develop their skills?

14. 3. Strategic Thinking vs. Strategic Planning Strategic Thinking k) Protection of Assets • do protect our most valuable assets and ensure that they will be available in the future to contribute to future results • this includes intellectual property as well as human and physical resources l) Monitoring and Reporting • does management have the information it needs to support its decision-making and accountability, and is it used appropriately? • are we meeting applicable standards and regulations adequately?

15. 3. Strategic Thinking vs. Strategic Planning Strategic Planning a) a popular, yet demonized form of long range planning that provides a framework for organizational direction setting, over a longer time frame, based on a study of internal and external factors b) various “stakeholders” participate in discussions of “strengths and weaknesses” (internal) and “opportunities and challenges” (external) which provide the “data” on which the plan is founded

16. 3. Strategic Thinking vs. Strategic Planning Strategic Planning c) analysis and consensus building is used to develop a plan that capitalizes on strengths, minimizes the impact of weaknesses and provides direction towards areas of opportunity. d) the plan is approved by the governing body for implementation, via a multiple year action plan/schedule

17. 3. Strategic Thinking vs. Strategic Planning Strategic Planning e) periodic reports (at least annual) are used to measure progress against the plan and provide leadership where there are competing priorities f) after a significant period of time (3 to 5 years), the process is repeated

18. 3. Strategic Thinking vs. Strategic Planning Strategic Planning Commentary: • this form of planning is common in non-profits but is not used exclusively. The extent of this type of “multi-year” planning in a directed fashion is limited due to the lack of multi-year funding and lack of emphasis at the “governance” (Board) level. • It is also very time consuming and potentially very costly, depending on the scope of the project and use of consultants.

19. 4. Annual Planning Major and Minor Capital Planning • Major Capital spending for the year could be in keeping with a multi-year Capital Plan • the definitions of “Major” and “Minor” will vary with the funding source(s)

20. 4. Annual Planning Operational Planning • a comprehensive annual operating budget is always required, usually in a required format, as are periodic reports (monthly or quarterly) • it is common to have function specific plans in areas such as: technology, minor capital replacement, public relations, fundraising, staff recruitment, foster parent and volunteer recruitment, etc.

21. 4. Annual Planning Operational Planning • In child welfare, current reporting is done using a sophisticated gov’t supplied Excel Spreadsheet used quarterly to report expenditures, and project revenue and expenditures for the balance of the fiscal year • It contains many confusing pages with similar sounding titles, which are mainly undecipherable due to small font size!

22. 5. Planning Considerations at CCAS of Hamilton SWOT Chart

23. 5. Planning Considerations at CCAS of Hamilton

24. Putting Planning in its Place! (Stephen R. Covey) • Understanding “Quadrant II … the Quadrant of Quality” (increasing the “ability to do”, reduces time spent on crises and reactive activities of Quadrant 1)

25. Putting Planning in its Place! (Stephen R. Covey)

26. Putting Planning in its Place! (Stephen R. Covey)

27. Putting Planning in its Place! (Stephen R. Covey) b) Keeping the Production/Production Capacity (P/PC) BalanceThe trick is ensuring that each day, you contribute to “capacity building”. If you do not plan for the future, you will never know when you get there … and you will not be ready when it arrives!

28. 7. Questions Planning isn’t as much knowing the correct answers as it is knowing the correct questions!