THE BLOG
05/03/2015 11:02 am ET Updated May 03, 2016

Strategic Planning: Nonprofit Board Orphan?

Updated viewer favorite.

According to a 2015 BoardSource study, nearly 35 percent of over 836 nonprofit chief executives gave their boards a C, D or F grade in strategic development efforts. In addition, only 35 percent reported, extensive use of "meetings focused on strategy and policy."* This is further evidenced in the frequent absence of long range planning items on nonprofit board agendas. What are the root causes of such a deficit in an area that is of critical importance to the future of the organization? One or more of the following challenges may apply:

Reviewing the Outcomes of Operations Is More Interesting
Strategy discussion can be tedious, requiring a slow and careful process of analysis, forecasting and hypothesis development. Conversely, the board director in a nonprofit can often respond easily to the fascination of the current narratives from staff and how they operate to help clients. Discussing outcomes is also more managerially satisfying because they deal with current reality. A common result of these types of distractions is that a full agenda at board meetings discourages inclusion of strategy discussions. Studies show that for-profit boards also have these same types of strategic issues.

What to Do. Create and maintain a process for planning ahead. It may be a one to two year plan with a goal for the retirement of a chief executive officer, and a review of all management positions and personnel. Also the nonprofit might consider positioning a "lead director" to jump-start and maintain the strategic process. The idea of "lead director" has been effective in corporate boards and can be used successfully with nonprofits, making the long range plan an agenda item at most board meetings! (Learn more here.)

Directors Join a Board for Different Reasons
A board benefits from the diversity of its members. Every nominated director has a different reason for accepting the commitments of board service. Some directors may be altruistic, while others can have self-serving reasons. However, all types can make a contribution when properly motivated and be given meaningful assignments. No board can expect every member to have strategic planning experience. A priority focus of the board chair and chief executive is to make certain that all can work with directors who have a strategic orientation and understand the mission, vision and values of the organization.

What to do: Make sure that among the board nominees there is a reasonable portion with relevant planning talent and/or experience. Just having lower level strategy experience is not enough. Knowing processes, like Management By Objectives, is fine. But this knowledge provides little bases for developing insights on how to apply it creatively. An example would be the professor serving on a nonprofit board who confuses a nonprofit's management and staffs by having the board install a mandated unwieldy MBO program.

Schedule Frequent Meetings between the Chief Executives and Individual Directors
A Chief Executive should meet privately with several different directors on a quarterly basis, so that all directors are involved in at leases two private meeting annually. The sessions serve as a forum for updates on operations and emerging challenges. It also provides a personal connection with the individuals and an opportunity for questions and comments that they might not feel comfortable airing at a scheduled board meeting. These meetings are also opportunities to present embryo strategy ideas for discussion and to subsequently discuss strategy implications once the ideas come before the board.

What to Do: Make the organization's future a part of each of these meetings. Report on the planning progress. Allow the director a chance to articulate his/her vision of what the organization can do or be in the years to come, and what trajectory could make that happen. These types of informal interchange will invite participation and strengthen common goals.

Summary: The absence of a strategic planning process endangers a nonprofit's future growth and stability. Making that process a priority in nonprofit board operations involves selecting and training board members to appreciate its importance to the ongoing success of the organization. It is the Chief Executive and Chairperson who must keep that subject alive among the members of the Board by raising and maintaining awareness of the necessity to keep looking ahead and to keep the strategy process on track.

*BoardSource (2015) "Leading With Intent -- A National Index of Nonprofit Board Practices," January.