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Question One: What Are You Doing?

John Bauer May 16, 2017 blog, News

So begins the journey into self-discovery and planning your preferred future.

I have been mildly surprised to hear nonprofit clients tell me, “We don’t have to mess around with reviewing the mission statement. Our board just went through that exercise. We’re fine with our current statement. Let’s just get on with writing a strategic plan.”

I certainly don’t wish to denigrate the efforts of CEOs and boards to evaluate their organizations’ mission statements, but the strategic planning process really does need to begin with a careful analysis of what the organization is doing, with whom, how, and why. Ideally, these questions have already been answered in a pithy, one sentence statement. It’s just that I’ve seen too many organization’s treat this exercise as nothing more than a necessary but annoying task that boards periodically conduct. On the one hand, it may be viewed as an opportunity by a few to contrive a grandiloquent slogan. On the other hand, the exercise may be greeted with disdain as if it has no relevance to what the organization does. One college president told me, “We don’t need a mission statement. Our mission statement is what we do every day.”

Let me suggest that “mission” for a nonprofit organization is the same as “profits” for private sector companies. Thought of in this manner, having a clear and effective mission statement for a nonprofit is as important as knowing product demand for a for-profit company. “If mission accomplishment is as important as profit attainment, why do most nonprofits not spend equivalent time in mission creation and monitoring? In reality, nonprofits often completely mess this up. As important as missions are, nonprofits frequently go off in ineffective directions by relying on mission statements that can be little more than slogans” (Pandolfi, 2011).

So, in the interest of launching strategic planning at the correct starting point, indulge me for a few minutes as I dig a little deeper into this first question: “What are you doing?” It seems to me that the starting point for strategic planning must be a consensus understanding of what the organization strives to accomplish by fulfilling its mission. Conversely, failure to seriously address the organization’s mission not only can undermine the strategic planning process, but will likely contribute to ambiguity of purpose in the minds of significant stakeholders. Without careful analysis of the organization’s mission, strategic planning itself will likely become an unprofitable academic exercise incapable of providing the focus and discipline needed to achieve the organization’s preferred future.

To understand the significance of such an analysis, consider a few mission-related questions: Why was your organization founded? Who started it and why? Are you doing the same thing today that the founders did on day one? With whom do carry out your mission? Do you serve the same population? What will this population look like in the future? Who supports your mission? How do they perceive your mission? What impact is your mission having? Can you demonstrate that you are fulfilling your mission? Can you measure the impact it has on the target population? What do you think your mission will look like in five or ten years? Is your mission sustainable? The mission statement of a nonprofit organization is the critical starting position from which to answer all those questions and upon which to build strategies to proactively prepare for the future.

So what is a mission statement and what are the attributes of an effective mission? Koenig suggests that every good mission statement has three pivotal elements:

Our cause: Who? What? Where?
Our actions: What we do.
Our impact: Changes for the better.

He goes on to graphically illustrate the attributes of good and bad mission statements (figure 1).

(figure 1)

The most effective mission statements are written in a single sentence of 15 words or fewer and contain all three of those elements. Here are a few examples to make the point.

Public Broadcasting System: To create content that educates, informs and inspires.
Environmental Defense Fund: To preserve the natural systems on which all life depends.
CARE: To serve individuals and families in the poorest communities in the world.
And of course, TED: Spreading ideas.

More than just serving as an inspirational slogan that employees and donors can get behind, Pandolfi argues that “an effective mission statement must be a clear description of where an organization is headed in the future that distinctly sets it apart from other entities and makes a compelling case for the need it fills.” In other words, there are critical business reasons tied to the organization’s strategy. In the same way that a clear and effective strategy in the private sector attracts more customers which result in more profit, a nonprofit’s clear and effective strategy facilitates attraction of funds and provides the ability to take smart action.

And if you think mission statements are old fashioned, consider this. Recent research at Ohio University shows that Millennials especially are drawn to a strong mission. “Young employees want to believe their work is making a difference, whether they are in the for-profit or nonprofit sector. Good mission statements place the organization in the wider social context, and show how the work of the organization contributes to making society a better place” (Fritz).

An effective mission statement also allows a nonprofit organization to operate with focus and discipline by providing consistency in decision-making. It also suggests the means for measuring success and creates a shared understanding among all stakeholders that transcends time and place. In other words, an effective mission statement is translatable into measurable actions that everyone in the organization can understand, monitor, and influence.

One might also ask the question: “What would the world look like if we actually fulfilled our mission?” Would hunger cease? Would discrimination be eradicated? Would every child succeed in school? Contemplating such “mission exits” should lead organizations to think deeply about how they measure their success. A good mission statement should suggest what that world would look like if completely fulfilled.

Finally, I believe that the process of creating a mission statement is of equal importance to the end result. In the nonprofit world, boards of directors are the caretakers of the mission. CEOs are hired to advance the mission and make sure it is carried out. Staff are directed to manage processes which support the mission. Donors provide financial support for the cause described by the mission. All these participants have a stake (hence, the term “stakeholder”) in the success of the organization, either morally (boards, donors and volunteers) or practically (staff who are paid for their services). Engagement of all these stakeholder groups in the creation/review/analysis of the mission statement is one of the most effective ways available to build support and loyalty.

As a consultant, ever eager to serve my nonprofit clients, I have found it occasionally challenging to insist that the process begin with a thorough discussion and review of the organization’s mission statement. Invariably, however, when such a review conducted, it serves as the foundation to developing a robust and effective strategic plan.

Once the organization is clear about what it does, it can proceed to do a deeper dive into the remaining nine questions. Up next week: How well are you doing?

References Cited:

Fitz, Joanne. How to Write an Amazing Nonprofit Mission Statement. (online article at: https://www.thebalance.com/how-to-write-the-ultimate-nonprofit-mission-statement-2502262. (January 20, 2017)

Koenig, Marc. Nonprofit Mission Statements – Good and Bad Examples. (online article at: https://nonprofithub.org/starting-a-nonprofit/nonprofit-mission-statements-good-and-bad-examples/.) (2013)

Pandolfi, Francis. How to Create an Effective Non-Profit Mission Statement. Harvard Business Review. March 14, 2011)

Coherent Strategic Planning: Ten Critical Questions

John Bauer May 8, 2017 blog, News

It has been a while since I have written about strategic planning. In two previous articles, I expressed my academic concerns about traditional strategic planning methodologies, especially in the current climate of rapid change and uncertainty. I suggested a middle ground between long-range strategic planning and the need for immediate strategy, execution, learning and nimbleness. (see Strategic Planning: What’s the Point? and Strategic Plan or Strategy Execution?)

For the past year, I have been busy working with several clients on strategic planning projects that have given me a real-world laboratory in which to test some of my ideas. I’d like share some of what I have learned and suggest a pathway you can follow to create a more dynamic and practical approach to strategic planning. Because it appears that strategic planning is still of significant concern to CEOs and boards, and because I am being contacted almost exclusively to work as a consultant in that area, it is more than timely to become more explicit about what works and what doesn’t.

A strategic plan can be thought of as a story. It has a past, a current reality, and a future that has yet to be written. In other words, a strategic plan provides a narrative context for understanding the organization and its movement into a desirable future. Because the story is still being written, it is sometimes useful to step back and ask a few simple questions in order to establish meaning and purpose for the activities that comprise strategic planning. I have found these questions to be particularly helpful with boards of directors who may not always see the complexity of organizational processes or have the capacity to digest large quantities of information. While there are myriad tools, systems, methods and models of strategic planning, not all of them address all of these foundational questions. My experience has shown me that any plan that doesn’t somehow answer these questions does not serve the organization well.

There is nothing magic or exclusive about these questions. They occurred to me because I have had to explain why I was recommending certain activities in the planning process. In fact, I have found that they often elicit additional questions, either for clarification or further analysis. Feel free to add or subtract in order to serve your needs. For my purposes, I focus on these questions to help boards understand what we are ultimately trying to accomplish.

What are you doing?
How well are you doing it?
What will your environment look like in the future?
What does your environment look like right now?
Where would you prefer to be in the future?
Can you get there?
How will you know if you get there?
How will you address unexpected challenges and opportunities along the way?
How will you support continuous learning, thinking and acting?
How will you tell the story, to whom, and for what purpose?

I’ve decided to write a short article on each of these ten questions. I’ll be posting these every Monday for the next ten weeks. I hope you will find them helpful as you think about your organization and the future you would like it to achieve. At the end of ten weeks, I will also provide a bonus article which will describe my attempt to visually depict this model. Hopefully, by the end of ten weeks, I’ll have refined my schematic so that it is easily understandable. The difficulty has been in trying to integrate a largely linear long-range process with periodic cyclical activities, all the while implementing tools to remain nimble and responsive to unanticipated challenges and opportunities. I think I have found a way to illustrate these three concerns in terms of measures of time, but you’ll have to be the judge.

In the meantime, I’d love to hear from you about your experiences doing strategic planning in your organization. Please share the good, the bad, and the ugly. We all learn from each other’s successes as well as failures.

Lonely at the Top: Redux

John Bauer September 30, 2016 News

It does not have to be “lonely at the top.” The notion that chief executive officers must come from a species of super-independent, self-sufficient, emotionally rock-solid, wise, socially comfortable, and confidently decisive leaders is delusional. Nobody in the chief executive role that I have met qualifies in all areas. CEOs are human beings with both strengths and weaknesses. That they may possess qualities that set them uniquely apart to lead organizations can’t be argued. Why else would search committees and boards of directors go through the candidate evaluation process when hiring a new CEO? Skills, attitudes, personal qualities, good judgment, previous experience, education – all are considered in the screening and hiring process. Every organization wants to believe that they have chosen the best of all possible candidates to be their leader. But to think that they are somehow impervious to the foibles of being human? Well, that just does not align with reality.

The unfortunate fact is that many CEOs end up feeling isolated and very alone. As I have previously written, there are many factors that contribute to isolation and which insulate the chief executive from his or her staff and board. (See my article entitled “Lonely at the Top.”) With no peers in the organization, the CEO often finds that there are very few, if any, reliable confidants with whom to share ideas, concerns and fears. Notwithstanding the fact that a “work spouse” may provide a sympathetic ear, both subordinates and supervisors (usually the board) are ill-advised sources for emotional, social, professional and psychological support. And not all CEOs have spouses who can provide that kind of support.

It doesn’t have to be that way. Drawing upon the experiences of people in religion, recovery and higher education, I would suggest that CEOs can benefit significantly in their professional and personal lives if they have at least one individual they can utilize as a mentor or guide. Many religious traditions suggest using a spiritual guide, that is, someone who is wise and accepting, with whom deep spiritual concerns can be shared, and to whom questions of faith can be addressed. Alcoholics Anonymous suggests that recovering alcoholics get a sponsor, usually someone with a sufficient number of years of sobriety, who can guide the person through the 12-Step program and provide encouragement and support. And it is very common for graduates of doctoral programs to reminisce fondly about the cherished hours of dialogue with their advisor and mentor, and the intense intellectual stimulation and growth that came from such wise guidance.

While one’s intelligence may have been part of the reason for getting the job and for being able to lead and accomplish great things, it is also true that many of the problems CEOs face are the products of their own thinking. As Albert Einstein observed, to believe that the thought processes which created a problem can be used to solve the problem is insanity. Everybody needs an external check against egoistic self-reliance.

A cherished colleague of mine who is a psychotherapist contends that healthy human beings need at least five true friends in their lives, not including a spouse or significant other. She defines such a friend as one who, if they had to watch the entire video of your life – revealing every thought, word and action – would not run screaming out of the room. Or, as St. Augustine said, “A friend is someone who knows everything about you and still accepts you.”

I’d like to believe that the large majority of CEOs have a solid circle of such friends who can help them maintain sanity and balance in their personal and professional lives. I just don’t happen to know too many. And I certainly wasn’t one of those fortunate few, either. I wish I had been. My experience has shown me that CEOs have a great need for holistic support from others who care deeply for them and who can provide honest, trustworthy and confidential advice. But this requires a certain amount of vulnerability, something which doesn’t come naturally for many executive leaders. As one of my spiritual guides, Fr. Richard Rohr, recently wrote:

Did you ever imagine that what we call “vulnerability” might just be the key to ongoing growth? In my experience, healthily vulnerable people use every occasion to expand, change, and grow. Yet it is a risky position to live undefended, in a kind of constant openness to the other—because it means others could sometimes actually wound us. Indeed, vulnera comes from the Latin for “to wound.” But only if we take this risk do we also allow the opposite possibility: the other might also gift us, free us, and even love us. (CAC.org, Daily Meditation, September 28, 2016)

To address this need for growth and support through vulnerability, some CEOs hire an executive coach to provide objective, dispassionate advice and counsel. That’s fine at the professional level, but doesn’t usually address personal issues. Others utilize the services of a psychotherapist to manage emotional challenges. Still others use a spiritual guide with whom they can “confess.” I even know of one retired CEO who for years had his own private board of directors. This was a relatively small, diverse group of individuals who held him accountable in every aspect of life. Their pledge for total confidentiality only cost him several dinner meetings each year – a very small price to pay for the benefit he derived. He told me that he both looked forward to and dreaded those meetings. They made him better. They kept him whole. And they made him accountable.

It doesn’t have to be lonely at the top. But the first step has to be taken by the CEO – first, to acknowledge his/her need for such counsel, but second, to actually put such a practice into effect. Boards can suggest. Consultants can encourage. Coaches can prompt. But CEOs must put their egos aside and create their own circles of support. Their very careers may well depend on it.

Your thoughts around the need for this kind of vulnerability are encouraged. If you would like to talk more about this with me in an absolutely confidential manner, just give me a call.

Strategic Plan or Strategy Execution?

John Bauer September 10, 2016 blog, News

This past June there was an interesting exchange on the Blue Avocado website between its editor, Jan Masaoka and Michael Allison, author of one of the most widely accepted books on nonprofit strategic planning. Like many others recently, Masaoka called into question the value of strategic planning for nonprofit organizations, pointing out numerous flaws that often beset the process. Numerous organizations have wasted considerable time and money developing a comprehensive long-range strategic plan, only to have it lose relevance as internal and external conditions change for the organization, fail from lack of translation into operational plans, or die from lack of attention or resources.

Allison argued in return that strategic planning which reflects thoughtful and accurate understanding of the environment and incorporates ongoing performance measurement, still provides the best framework for organizational growth and advancement.

I argued for a middle ground in my last blog article on this subject, Strategic Planning: What’s the Point? I believe that a strategic planning process which is suited to the culture and character of the organization, leads to clarity of mission and vision, and provides a framework for ongoing strategic decision-making based on continuous performance measurement and environment scanning is the best way for nonprofit leaders and their boards to achieve their preferred future.

However, missing in this debate is the single biggest factor which can either drive success or failure, regardless of the approach to strategic thinking/planning. I’d like to suggest that the factor which is often overlooked in this debate is the extent to which the chief executive officer actually executes the strategic initiatives described in the plan. In other words, regardless of the scope or duration of the plan, regardless of the format, the benchmarks, the style or any of the other variances in how good strategic thinking and planning can occur, it falls on the shoulders of the CEO to make sure that the plan is turned into action and that the strategies are not only implemented, but evaluated and monitored.

It has become common knowledge that CEOs are rarely fired for failing to do planning. In fact, the attribute often admired in CEOs is their ability to see the big picture, to think globally, to cast a large vision, to fly at 30,000 feet, to converse with angels…. well, you get the point. I used to say that my job as a CEO was to stare out the window and think profound thoughts. Of course, that isn’t all CEOs do, but they are expected to be the chief architects of the organization’s vision for the future. And that’s what strategic planning is all about. Notwithstanding the potential pitfalls inherent in the way much traditional strategic planning is conducted, CEOs are expected to present a coherent vision for the future which not only advances the organization’s mission, but does so in a financially sustainable manner.

Allison certainly agrees with this point, as witnessed by the fact that the third edition of his book, Strategic Planning for Nonprofit Organizations (2015) includes the articulation of a business model using the sustainability matrix mapping exercise described by Bell, Masaoka and Zimmerman (2010) and updated by Bell and Zimmerman in 2015. And although he includes a very short final chapter on how to use the plan, including a few words on how to monitor changing trends, he basically ignores what I believe is the most important factor in successfully implementing the goals and objectives that together describe the organization’s preferred future.

So, how can CEOs make sure that their organization’s strategic plan is and remains a living and dynamic document which moves the organization forward? Micro-managing the process is not the answer. Implementing any of a number of common sense systems, however, can ensure constant attention to the plan and actually provide greater nimbleness to respond to changing conditions. Let me offer up a few ideas.

The first way to ensure the CEO’s attention to executing the strategic plan is to couple his or her annual compensation to fulfillment of the its goals and objectives. Some organization’s establish a base salary and then identify which portion of that base is dependent on achieving the plan’s goals. Other organizations set aside a certain amount of bonus money that can be awarded if goals are achieved. Regardless of the method, it only makes sense that the CEO’s annual performance review should be tied to the extent to which he/she tangibly moved the organization toward the preferred future, as defined by the strategic plan.
Lest you think that I am contradicting myself from my previous calls for dynamic strategic decision-making as opposed to traditional strategic planning, let me clarify. Boards adopt strategic plans and have every right to expect their CEOs to execute those plans. But Boards also approve changes to the plan as appropriate, support decision-making that comes as a result of changing conditions, and should reward leadership which reflects responsiveness to changing trends or conditions. A merit-based compensation plan which takes into consideration the fluid nature of strategizing may be more complex, but should be considered as part of the board’s expectations for its CEO.
Board engagement in supporting the plan can be achieved by structuring regular board meetings around the major themes of the strategic plan. Envision a board meeting in which the majority of time is spent evaluating the progress of the organization toward achieving its goals. Gone are boring operations reports. Financial reports are related to the plan, complete with scenarios and forecasts. I used this approach to good effect, not to keep the board unware of other operational matters (we published a board briefing book between board meetings which shared such information), but to help them fulfill their primary strategic, legal and fiduciary responsibilities. Boards can help their CEOs remain focused on strategy by explicitly demanding more board meeting time on strategic trends and issues.
Explicit decision-making processes should be developed and utilized. There are many models to choose from. I happen to like David LaPiana’s model of strategy and execution, but there are others. His approach can be used as an execution tool to actually drive forward the goals articulated in the strategic plan, while allowing for shifts in thinking that naturally come about in dynamic and changing environments. The CEO has to model this kind of continuous strategic decision-making and expect it of all other executives in his organization. The filters or lenses for making value judgments about strategic issues that arise can flow directly from the environment scan, business model analysis, and capacity assessment that should be part of the strategic planning process.
Let me interject a word here about consultants. It should be an expected part of every consultant contract for strategic planning facilitation to include the development and implementation of decision-making processes that support execution, implementation, learning, and adaptation. It may be necessary to utilize additional periodic consulting to advise the board and the CEO on how well its plans are being executed and to offer additional coaching and guidance. No organization should be satisfied with a “one and done” approach from a consultant. The ideal deliverable is an embedded process of strategic thinking, planning and decision-making that extends way beyond the publication of a slick planning document.
Let the entire organization know where it is headed. Through newsletters, video messages to employees and stakeholders, posters and other media, the CEO is not just the visionary who sees the future, he/she must also be the story-teller-in-chief. Dreams are shared through story. The strategic plan is a dream, albeit one that may change over time, as do all dreams. But the dream will stay locked in the corner office if the story isn’t told.

Do you have any suggestions on how the CEO can ensure execution of the strategic plan’s goals and objectives? I’d love to hear your comments and ideas.