David La Piana

I returned recently to Stanford Law School to give a guest lecture on nonprofit strategy to a class on social entrepreneurship taught by Suzanne McKechnie Klar. Suzanne founded Build, an amazing organization that provides real-world entrepreneurial experience for at-risk youth.  It was inspiring to meet a group of our most promising future lawyers and to learn how deeply they care about social justice. We had quite a lively discussion that reinforced the thoughtfulness of smart young people and the positive impact they are going to have on the world.

Following up my recent Merging Wisely article in Stanford Social Innovation Review, I will be discussing the practical issues involved in merging nonprofit organizations at the next SSIR Live! webinar. From Nonprofit Partnerships to Mergers: How to Restructure for Success will take place Tuesday, April 6, 2010, from 11:00am – Noon PT. I plan to leave plenty of time for questions, so bring yours and join us. Register today!

A January 25, 2010 article in the Wall Street Journal caught my attention.  Entitled “Strategic Plans Lose Favor, Slump Showed Bosses Value of Flexibility, Quick Decisions” by Joann S. Lublin and Dana Mattioli, the article describes several big companies’ efforts to find a better way, in the current economic uncertainty, to plan for the future.

Walt Shill, head of the North American practice for Accenture, is quite blunt: “Strategy, as we knew it, is dead. Corporate clients decided that increased flexibility and accelerated decision making are much more important than simply predicting the future.” Corporate planners are increasingly revising their forecasts monthly, but this too is the wrong solution in my opinion. It consists of continually moving the goal posts. When you first miss your numbers, recast them. Next month, repeat.

It is great to see corporate America, and consulting giants like Accenture, beginning to see the problems with long-term static planning approaches to strategy. We identified similar problems in the nonprofit sector years ago and prescribed a better approach to strategy, our Real-Time Strategic Planning methodology, which was described in The Nonprofit Strategy Revolution in 2008. Sometimes our sector leads the way! In this work we describe an ongoing strategy process designed to anticipate and respond to challenges and opportunities as they emerge.

Our new research initiative NonprofitNext and recently published monograph Convergence: How Five Trends Will Reshape the Social Sector has inspired a lot of talk about how to prepare for a future.

We are clear that the trends we study will have a profound impact on the sector’s work but we don’t know how they will evolve, interact, and respond to other economic, social and political developments. What can a thoughtful leader do in this constantly changing landscape?

One thing is certain: traditional strategic planning with its 3-5 year timeframe is not up to muster in this dynamic environment. That’s why we created Real-Time Strategic Planning to create an atmosphere where futurists can flourish.

What is the best way to find something? What’s the fastest and most efficient way to get something done? Using the internet and social networks?

Those are some of the questions asked in a recent DARPA (Defense Advanced Research Projects Agency) Network Challenge competition. All around the country the Pentagon hid (in plain sight) 10 eight-foot diameter red balloons. One was in Union Square in my nearby San Francisco. Then DARPA offered a $40,000 prize for the group that first found all ten.

The winners were the M.I.T. Media Lab’s Human Dynamics Group. They didn’t use GPS, they used email, Facebook and YouTube. Basically, they offered to pay money to people with leads. The effort spread virally through the Internet and the team located all ten balloons in an amazing eight hours and 56 minutes!

Can crowdsourcing to your networks help you achieve your goals faster?

The current unpredictable economic environment for nonprofits is making the traditional three-year strategic planning time frame obsolete. One approach that makes a lot of sense is business model analysis. How well does your current business model meet the need for keeping your organization is the black?

For example, a theatre company traditionally relied on ticket sales for 60% of its revenue and donations from individuals, foundations and events for the remainder. Now, fewer people are buying tickets and the theatre believes the mix needs to shift to 50/50. Business model analysis would test this assumption and if necessary, adjust it. Perhaps ticket sales will fall more precipitously, or perhaps donations will fall even further.

Business model analysis allows an organization to consider every input into its “economic logic” arriving at the best set of alternatives and choosing the most likely path to success. In this environment three-year projections can be misleading, but you still need a roadmap to your organization’s future.

My colleague Jo DeBolt and I recently completed a two-day training program for the national YMCA’s Resource Directors. At one point one of the Directors got up and reported that she had searched the Bible for references to planning.

Here are some of the best she found:

“Where there is no vision, the people perish.” Proverbs 29:18

“What a shame – yes, how stupid! – to decide before knowing the facts.” Proverbs 18:13

Here is one every capital campaign consultants could use:

“Suppose one of you wants to build a tower. Will he not first sit down and estimate the cost to see if he has enough money to complete it? For if he lays the foundation and is not able to finish it, everyone who sees it will ridicule him, saying ‘This fellow began to build and was not able to finish.’” Luke 14:28-30

And my favorite:

“A wise man thinks ahead; a fool doesn’t, and he even brags about it!” Proverbs 12:16

In 2006, a Yahoo executive wrote a memo that I think many nonprofits would do well to heed. It became known as the Peanut Butter Manifesto. I just came across it in an article in the New Yorker.

We lack a focused, cohesive vision for our company. We want to do everything and be everything – to everyone. I’ve heard our strategy described as spreading peanut butter across the myriad opportunities that continue to evolve in the online world. The result: a thin layer of investment spread across everything we do and thus we focus on nothing in particular.

Sound familiar? In good times there are resources enough to try new ideas, experiment, spread the nonprofit peanut butter far and wide in an effort to “do everything for everyone.” That could be the mission statement for a few nonprofits I know. But during tough times, you must focus, you must decide what is most important, what is your unique contribution, where you have the best chance to accomplish your mission. This may mean cutting back in some areas to strengthen others. It may mean job reassignments or even layoffs. But your strategy, now more than ever, must be clear and focused.

Pile the peanut butter thick on a smaller slice of bread.

For many years I have been giving talks on various topics at the annual Craigslist Foundation Nonprofit Boot Camp. I usually feel these sessions are pretty well received and several of them live on as podcasts at the Craigslist Foundation web site.

Recently I was very pleasantly surprised to learn that one of these talks, from 2007, entitled “How to Succeed as a Nonprofit Executive Director” is the most popular podcast from all past Boot Camps. In fact, it has been downloaded more than 5,000 times!

And if that isn’t enough for you, my most recent Boot Camp presentation, from this past summer, on Real-Time Strategic Planning, was just uploaded on the site as well.

Check it out and tell me what you think!

The White House recently called for Americans to donate relief aid to Pakistan by text message. I doubt this is a first for the Obama White House, but it sure makes sense. Americans are generous to a fault, and these days, they seem to be texting like it is going out of style. So why not combine the two?

Has your organization incorporated cell phone texting as a fundraising medium? Let us know and we might feature your campaign in our latest research initiative, Nonprofit Next.