planning

PLANNING
The Planning Process

Planning is one those things that we all know is good for us, but that no one wants to take the time to do. While it may seem that planning only takes time away from running your business, operating a business without a plan is like going to a grocery store without a list and trying to remember all the items that are needed. One comes out of the store having forgotten something critical - and having purchased a number of items that are totally frivolous and may never be used. It is the same for a business operating without a plan. Critical issues do not get addressed - and some tasks get done that have no relationship to the direction the business needs to go. For a business, however, the consequences of these unaddressed issues can range from inconvenience to bankruptcy.
Part of this reluctance is due to how complicated the process is viewed. Yet a complicated plan is almost as useless as none. The real question is how to make something simple that fits your business' needs. Can a good grocery list system be devised that isn't unnecessarily burdensome for all involved? Of course. Let's take a look as what planning really entails.
The word "plan" originated from then Medieval Latin word planus which meant a level or flat surface. This evolved in French into being a map or a drawing of any object made by projection upon a flat surface. In English this has become a more general sense of a scheme of action, design or method. Planning in its current usage in business implies a consciousness of what is happening in the business. It does not preclude creativity or instinct, but it does add a layer of awareness that spells the difference between survival and extinction in a changing environment. Planning does involve:
an understanding of the business' history
an examination of the business' environment
an assessment of the business' mission
goals
a process for reaching those goals
a process for gathering information
a realization that planning is a continuing process that is constantly evolving
Planning does not necessarily mean trying to project the future, but being aware of a range of likely futures and being prepared for them as occur.
Business PlanA business plan is used when one is starting a new business or a new process or product within a business. It includes not only a description of the new business, process or product, but also a discussion of how one plans on managing the marketing, development, production, and financing of this new venture.
Organizational Plan
Organizational planning, when it does occur, too often is spurred by crisis, focused on the short term, and not well thought out. To create healthy futures, organizations must construct processes for creating their futures that are not fueled by crisis and turmoil. It can be done.
One of the most confusing aspects for those who want to plan is the variety of terms that are used in conjunction with planning. How do you differentiate between a business plan, a financial plan, a marketing plan, a human resources plan, an operations plan, a strategic plan, a long-range plan and just plain general planning? The simple answer is that each area of your business needs planning so each area should have its own grocery list of what it wishes to accomplish in the future.
Planning Principles
Any plan should include who, what, when, where, how, and why.
Who is needed to accomplish this task?
What needs to be done?
When does it start and end?
Where will it take place?
How will it happen?
Why must we do it?
Along with the answers to these questions there needs to be some operational scheme to organize the tasks needed to achieve the goal.
A helpful approach is to work backward from the goal to decide what must be done to reach it. The backward approach is a way of looking at the big picture first, and then planning all tasks, conditions, and details in a logical sequence to make the big picture happen. From this a to-do list can easily be made. This list will become a checklist to ensure everything is progressing as planned. Adjustments can be made based on changing circumstances. The plan (list) should be referenced often as a set of signposts on the journey towards the goals.
For many of us who left corporate America in favor of a smaller work environment, the idea of drafting a plan may seem offensive. After all, isn't frustration with all that busywork one of the reasons we left in the first place? We all have an aversion to doing anything on our job that doesn't immediately help the situation we are now experiencing. However, isn't it also true that a little foresight and action before the fact can help eliminate many of the problems we face each day. Wouldn't it be nice to anticipate something like a price cut by your major competitor or a rise in the interest rate on your credit line? Of course it would. And with that anticipation comes an organized and effective response. That is what planning is really about.

I. IMPORTANCE OF PLANNING
There is broad agreement among nonprofit leaders and experts that planning is a critical component of good management and governance. Planning helps assure that an organization remains relevant and responsive to the needs of its community, and contributes to organizational stability and growth. It provides a basis for monitoring progress, and for assessing results and impact. It facilitates new program development. It enables an organization to look into the future in an orderly and systematic way. From a governance perspective, it enables the Board to set policies and goals to guide the organization, and provides a clear focus to the Executive Director and staff for program implementation and agency management.
Most organizations understand the need for annual program objectives and a program-focused work plan. Funders require them, and they provide a basis for setting priorities, organizing work, and assessing progress. A growing number of Hispanic community-based organizations go beyond funder requirements to develop annual objectives and operating plans which also include a systematic plan for resource development, organizational development, and in some cases Board development. Most groups find it practical to define objectives for a 12-month period, and to design strategies and programs to meet them.
Longer-range planning – planning beyond the next year or two – often seems more difficult and less rewarding. With the external environment changing so rapidly, Board members and senior staff ask, how can we expect to develop plans that will remain relevant? With so little control over external events, how can we hope to influence them in a way that benefits our community?
In fact, planning is no less important in a changing environment; it may well be more important. Most Hispanic community-based organizations exist to serve a specific community. To do that, they need to be very clear on community needs and then work to address them through similarly clear organizational missions, priorities, target groups, and objectives. If the external environment – funding, the economy in general, government enforcement of civil rights laws, etc. – is changing or hostile, then our organizations must be that much more effective in defining needs and marshaling internal and external resources to meet them. The community's needs will change over time, but the most basic ones – such as access to high quality educational services, job training, employment opportunities, safe and affordable housing, sufficient financial resources to meet basic needs, human services directed at various age groups and special needs populations, and a secure environment – remain fairly constant. The challenge of meeting them can become greater with changes in the local or national environment, such as a poor economy or a hostile or unresponsive government, however; and it is here that strategic or long-range planning can be most helpful. Planning is designed to help an organization define its vision for the future and then determine systematically how it will get there, understanding obstacles and figuring out ways to overcome them.
There is an important caveat: Longer-range planning requires some level of organizational stability. It is very difficult to plan in a crisis, and unrealistic to look five years ahead unless an organization has some confidence that it will exist next year, and that most of its key staff and its Board leadership will continue to be affiliated with the organization. Board and staff also need the time to plan, which means that they must not be using every minute to carry out functions required for survival. Moreover, while planning provides increased organizational definition, a sound base for planning is consensus concerning a well-defined mission statement and/or organizational goals – these must often be developed as a foundation for longer-term planning. It is also difficult to plan if the organization is so young or its leadership so new that they do not have a good sense of the community and of the broader external environment. Most new organizations, or groups which have undergone major institutional difficulties or change, find that they do best by first attempting to reach consensus on an organizational mission statement and then doing shorter-range planning, usually for a single year. Learning from that experience, they can begin a longer-term planning process.
Planning that focuses on a period of three years or more requires an organized, serious effort which takes time and energy. There may need to be a formal community needs assessment as input to planning. This is extremely valuable, but also demanding. Moreover, planning is not a one-time effort; any plan needs to be reviewed, monitored, and updated. The benefits to an organization can be significant -- a clear focus, a sense of joint purpose and agreed-upon priorities, consensus on strategies, and a basis for measuring progress and impact.
II. DEFINING LONG-RANGE AND STRATEGIC PLANNING
The term strategic planning has become very popular in recent years. Many nonprofit organizations now talk about doing strategic planning rather than long-range planning. Yet the difference between the two is not intuitively obvious, nor universally agreed upon. Following are typical definitions and explanations of the two terms:
Long-range planning: The process by which the leaders of an organization determine what the organization wants to look like at the end of a specified period of time – usually three to five years – then use that vision to establish multi-year goals and objectives which describe what the organization wishes to accomplish, and develop programs, tasks, and timelines for achieving them. Long-range planning predicts future conditions and realities, internal and external, and plans how the organization can function effectively within them. Because it involves multi-year projections, it cannot be as specific as short-term or operational planning, which generates a work plan with detailed annual objectives, tasks, methods, timelines, and responsibilities. However, it tends to be more focused on specific objectives and timelines than strategic planning.
Strategic planning: The process by which leaders of an organization determine what it intends to be in the future and how it will get there. To put it another way, they develop a vision for the organization's future and determine the necessary priorities, procedures, and operations (strategies) to achieve that vision. Included are measurable goals which are realistic and attainable, but also challenging; emphasis is on long-term goals and strategies, rather than short-term (such as annual) objectives. Strategic planning assumes that certain aspects of the future can be created or influenced by the organization. Strategic planning is ongoing; it is "the process of self-examination, the confrontation of difficult choices, and the establishment of priorities" (Pfeiffer et al., Understanding Applied Strategic Planning: A Manager's Guide). Strategic planning involves "charting a course that you believe is wise, then adjusting that course as you gain more information and experience" (Wilder Foundation, Strategic Planning Workbook). Differences between strategic and long-range planning: While closely related to long-range planning, strategic planning is generally considered to place a greater emphasis on strategies .
III. A STRATEGIC PLANNING PROCESS
There are many different models and action steps for strategic planning. One approach is summarized below. It assumes a cooperative effort between Board and staff, perhaps with a special strategic planning committee of Board members and staff taking responsibility for the effort. Some of the work can be done in committee, while Board and staff planning sessions or retreats are also likely to be required, both early and late in the planning process. Typical steps are described below, along with some suggested approaches for carrying out each step.
Frequently, Steps 1-3 occur before a strategic planning retreat, Steps 4-7 during the retreat, and Steps 8-10 after the retreat.
1. Agree on a strategic planning process. This may be done at a Board meeting with key staff present, or may require a special meeting or retreat, including Board, key staff, and some external stakeholders. At the session:
􀀹 Provide an understanding of what strategic planning is and how it is done;
􀀹 Discuss its potential value to the organization, in terms of providing a common vision and focus, with agreed-upon goals and strategies;
􀀹 Consider the costs of doing strategic planning, in terms of staff and Board time and other resources – and what might need to be given up in order to develop a plan; if the organization is in crisis or is financially or organizationally unstable, it may be difficult or unwise to enter into a strategic planning process until the immediate problems and needs have been successfully addressed;
2. Carry out an environmental scan. This helps provide an understanding of how the organization relates to its external environment. The scan usually includes an external component -- identifying and assessing opportunities and threats in the external environment -- and an internal component -- assessing organizational strengths and weaknesses. This process is often referred to as "SWOT": strengths, weaknesses, opportunities, and threats.
• The external component of the environmental scan should include a review of the target or service community and the broader environment in which the organization operates, to identify the opportunities and threats facing the organization. This might include the following:
􀂅 Consider forces and trends in the broader community, political, economic, social, and sometimes technological (See Bryson, Strategic Planning for Public and Nonprofit Organizations). Look at changing demographics, political trends, community values, economic trends, the implications of new or changing laws and regulations affecting the organization, communications and other technological trends -- and consider their impact on your organization and the population it serves
􀂅 Look carefully at the immediate target community or service area to determine its status and needs, and specifically those of current and potential clients and beneficiaries of the organization's services and advocacy.
􀂅 Consider opportunities and challenges related to resources and funders.
• The internal component of the environmental scan includes an assessment of the organization's strengths and weaknesses. This may include a number of components or approaches.
􀂅 You may want to assess current organizational performance in terms of financial and human resources (inputs), operating methods or strategies (processes), and results or outcomes (outputs). If the organization does not have extensive objective measures of its outcomes, perceived performance can be partially determined through asking clients and stakeholders. Try to understand how key players or stakeholders in the broader community -- as well as constituents or clients -- view the organization. Sometimes, brief written forms are sent to, or interviews conducted with, key stakeholders; interviews are best conducted by a consultant, to assure frank and honest responses. Once you have this information, be sure to further analyze the reasons -- in terms of inputs and processes -- for perceived weaknesses in outcomes.
3. Identify key issues, questions, and choices to be addressed as part of the strategic planning effort. This may mean specifying "strategic issues" or questions that the organization should address, and setting priorities in terms of time or importance. If there is little disagreement about issues and priorities, it may be possible to move immediately to the organizational vision and then goals. If there is no agreement on general directions and organizational goals, it may be important to explore issue priorities and identify critical choices. This might be done in several ways. For example:
• Board and staff might be asked to identify strategic issues from the environmental scan, with individuals identifying a specified number of such issues and indicating why each is strategic, including the benefits of addressing it and the negative consequences of not addressing it. These issues might involve a wide range of program or other issues – e.g., the need for new programs to address a particular community need such as education or housing, expansion of the organization's target area from particular neighborhoods to the entire city or county, agreement on who constitutes the organization’s constituency, or a decision as to whether the organization should consider merging with another group.
4. Define or review the organization's values, community vision, and mission. Be sure there is consensus on why the organization exists, what goals or outcomes it seeks to achieve, what it stands for, and whom it serves. If it has specific mandates –things it must do or not do based on its articles of incorporation or bylaws, or long-term contracts or grants – then these should be clearly defined. Consider beginning your strategic planning by agreeing on the following:

• Organizational core values or operating principles – those beliefs or principles that guide the organization; these values are shared by Board and staff, strongly held, and not easily changed.
• Community Vision – your vision for the community; it might be viewed as your image of what the community you serve would be like if your values were shared and practiced by everyone. Note that this is your vision for the community, not your vision of what the organization will look like in three to five years or more (that comes later!).
• Mission – the stated purpose for your organization’s existence; it might be viewed as your organization’s public statement of the contribution it promises to make to help accomplish the community vision.

5. Develop a shared vision for the organization. In some strategic planning efforts, a vision for the organization is developed after a vision for the community has been discussed -- with the assumption that a shared organizational vision may be dependent upon a shared vision of what society should become. Whenever this is done, it is important to agree on where the organization wants to be in three to five years (It is often helpful to focus on where you want to be at the end of the period covered by the strategic plan).
For many Board and staff members, it makes sense to first develop a vision of where the organization wants to be in a specified number of years, and then define strategies that will help it get there. The vision might describe the organization broadly, in terms of its mix of programs, reputation or status inside and outside its primary target community, key accomplishments, and relationships with stakeholders; specific descriptions might be included in relation to service/target area, program scope and depth, funding, governance, staffing, relationships with other entities, visibility, etc. This form of "visioning" can be done in many ways
6. Develop a series of goals or organizational status statements which describe the organization in a specified number of years – assuming it is successful in addressing its mission. It is usually a short step from the vision to goals – sometimes the statements describing the vision are essentially goal statements. It is extremely valuable to transform the vision into a series of key goals for the organization, preferably in the form of status statements describing the organization. For example, goals might cover a variety of categories, stated as follows:
􀀹 Program: "El Centro will operate an alternative high school with public school funding that will have a student body of 250"; "El Centro will provide comprehensive services to youth from pre-school through college age";
􀀹 Resources: "El Centro will have a budget of $3 million and a staff of 40";
􀀹 Status: "El Centro will be the largest and most respected nonprofit housing development corporation in Lake County";
􀀹 Relationships: "El Centro will be represented on major coalitions in its program areas and on the Boards of at least three major mainstream organizations";
􀀹 Institutional Development: "El Centro will own its own headquarters building, which will also have space for rent to other community-based organizations"; "El Centro will have a fully computerized financial management and management information system, with all staff connected through a network"

7. Agree upon key strategies to reach the goals and address key issues identified through the environmental scan. The major emphasis should be on broad strategies, including current and new program, advocacy, collaborative, or other approaches. These strategies should be related to specific goals or address several goals. The process requires looking at where the organization is now and where its vision and goals indicate it wants to be, and identifying strategies to get there. The Board needs to provide a broad view to guide this effort, while the planning group or staff can do much of the detailed analysis.

Whatever the specific approach used, specific criteria for evaluating and choosing among strategies should be agreed upon. They might include such criteria as the following:
􀀹 Value – Will the strategy contribute to meeting agreed-upon goals?
􀀹 Appropriateness – Is the strategy consistent with the organization's mission, values, and operating principles?
􀀹 Feasibility – Is the strategy practical, given personnel and financial resources and capacity?
􀀹 Acceptability – Is the strategy acceptable to the Board, key staff, and other stakeholders?

􀀹 Cost-benefit – Is the strategy likely to lead to sufficient benefits to justify the costs in time and other resources?
􀀹 Timing – Can and should the organization implement this strategy at this time, given external factors and competing demands?

8. Develop an action plan that addresses goals and specifies objectives and work plans on an annual basis. Once the longer-term elements of a strategic plan have been developed, it is time to ensure a specific work plan to begin implementation. Strategic planning recognizes that strategies must reflect current conditions within the organization and its environment. Thus it is rare to attempt to develop detailed annual objectives except for the first or perhaps the first and second year covered by the strategic plan. However, annual action plans are needed. Annual program objectives should be time-based and measurable. The annual plan may be a part of the strategic plan or may be an annual addendum to it.
9. Finalize a written strategic plan that summarizes the results and decisions of the strategic planning process. There is no set format, but be sure to include the outputs of each major step. The box at the end of this document provides one possibility.
10. Build in procedures for monitoring, and for modifying strategies based on changes in the external environment or the organization. Be sure progress towards goals and objectives and use of strategies is monitored regularly, with strategies revised and annual objectives developed yearly, based on the progress made, obstacles encountered, and the changing environment. Have procedures for taking advantage of unexpected changes such as more sympathetic elected or appointed officials, improvements in the economy, changes in local funder priorities, or changes in the target population. Define annual objectives at the start of each year. Look back to see what progress has been made in critical success factors. Use the plan as a compass, but not an inflexible blueprint for action.

References
Ø This article does not cite any references or sources.Please help improve this article by adding citations to reliable sources. Unsourced material may be challenged and removed. (June 2009)
Ø * Prepared by Emily Gantz McKay. Based on materials originally prepared for use with SHATIL, the technical assistance project of the New Israel Fund. Modified for the National Council of La Raza, and further modified for MOSAICA, May 1994 and July 2001