We have discovered a number of important insights over the years spent worked with a range of not for profit organisations. The challenges that not for profit organisations face are very similar to the struggles that many for profit organisations encounter, however, there are often less hands, less resources, and a lack of collective capability among many not for profits to be able to meet their strategic and operational requirements.
Board Composition and Selection
Board composition can be a tough thing to get right in any sector. However, the not for profit sector has the added struggle of dealing with a voluntary board structure. This means Board or Committee members are not paid for their time or expertise, and often, with any luck, are there because they believe and care about the cause or purpose of the organisation. Unfortunately, this means that there is often a lack of accountability regarding Board member performance, a lack of regard for the composition of the Board overall in having the appropriate skills and competencies to meet the organisations objectives. Quite often these organisations are having to "take what they can get".
Board selection in any sector is very important, however, in the not for profit sector perhaps even more so, as there is often a lack of operational infrastructure below the voluntary Board to actually carry out the tasks and strategies in order to meet the associations objectives. That is, they don't have an expert executive team or c-suit to operationalise the organisations strategies, nor the staff to carry out the tasks. It is therefore vital to the success of a not for profit that they have the necessary mix of skills and competencies on their voluntary Board or Committee to ensure the success of the organisation. Board recruitment and selection processes are integral in this regard, so is understanding the competencies and skills required to efficiently and effectively operate your association.
Like all other organisations, stakeholder engagement is a critical component for not for profits in assisting them to meet their strategic direction and objectives. Stakeholder engagement involves a range of data gathering methods used to gauge and deeply understand the perception of key stakeholder groups. These stakeholder groups could include customers, clients, industry groups, community members, employees, Board members and others.
Information should always be gathered using a broad variety of techniques including surveys, interviews, focus groups, market analysis, internal process and documentation evaluations, and others as the context dictates. This ensures that you are not reliant on one type of data e.g., surveys which may not give an accurate or complete picture. Rather, you can collect more pieces of the same puzzle to get a complete picture of the perceptions which exist regarding your organisation and its operations.
As with every sector, strategic planning is the crux to ensuring your business goals are effectively defined, communicated, and achieved. The intricacies of not for profits, often being run by a voluntary Board, with few resources to achieve success, sometimes means that strategic planning is either not being done or being facilitated internally as best as possible. Often voluntary Boards consist of a range of individuals from diverse industries, experience, and backgrounds. While this may have many benefits, it can also impede the strategic planning process.
Strategic planning is commonly seen as a process that comes easily to people working in large businesses or organisations themselves, and can have a heavy focus on the financial or compliance components of an organisation's operation. On the contrary, strategic planning requires specific skills, knowledge, and experience to ensure that the strategic direction of the organisation is appropriately informed by all necessary stakeholder groups - not just the opinions of Board or Committee members. It is important that a best-practice strategic planning approach is considered by not for profit organisations, as this will ensure that all tangible and intangible resources are being utilised for the achievement their goals, and not misdirected or highjacked. While the financial aspects of the organisation are important, more often than not it is actually the needs of the stakeholders that must be used to inform strategy as financial success hinges on these being adequately met.
Action Panning and Implementation of Strategies
The next step after strategic planning is action planning and implementation of your strategic plan into operational tasks and steps. Formal action planning for a not for profit organisation is vital to ensure that resources, including Board member time and skills can be utilised appropriately toward the achievement of your organisations goals. Not for profits do not tend to have troves of employees who are able to undertake a range of tasks across the spectrum of business areas, instead they often rely on a few (if any) paid employees and the support of their voluntary Board. Having a clear action plan therefore allows for accountability of voluntary Board members as tasks can be allocated with clear expectations for outcomes and timeframes.