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Strategic Planning

Strategic Planning – What it is and Why it is Important

Strategic planning is critical to a nonprofit organization’s future direction and survival. As such, it is important to understand what strategic planning is and why it is so important. This article provides a definition of strategic planning and why it is important to nonprofit organizations.

Wikipedia defines strategic planning as “an organization’s process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people.

” Strategic planning is the formal consideration of an organization’s future course. All strategic planning deals with at least one of three key questions:

1. The first key question is “What do we do? ” This relates to the organization’s vision and mission. An organization’s vision is broad… it is the final goal the organization aspires to achieve. The organization’s mission is a statement describing how the organization is going to meet its vision. For example, an organization’s vision might be to employ all persons with disabilities.

Its mission might be “Through the provision of vocational counseling, job seeking skills training, and job development and placement, assist persons with disabilities to gain or retain meaningful employment. ”

2. The second key question is “For whom do we do it? ” The organization needs to be clear about who its clients are in order to develop or modify programs and services to meet their needs.

3. The third key question is “How do we excel? ” This question relates to how well the organization is doing and what it could be doing better to best meets the needs of its clients. It also reminds the organization to assess its competition and develop a strategy to be the premier agency in its field.

Although these three questions should always be considered when developing, modifying, or deleting programs and services, it is also important that they be addressed before and during the strategic planning process.

The answers to these questions will help the organization to determine its direction, exactly where it stands, where it wants to go, and how it will get there. The resulting document is called the “strategic plan. ”

Strategic planning is a process organizations should engage in on an ongoing basis, regardless of the length of the plan. Some organizations engage in tactical planning, which is essentially a one year strategic plan. Tactical plans are developed when an organization is brand new or develops a new program or service that wasn’t included in the original strategic plan.

Generally, however, most strategic plans are 3-5 years. Although some plans could be longer, it is difficult to predict opportunities, threats, and trends in the field beyond three years. Whether the plan’s duration is one year or longer, the important thing to keep in mind is developing a plan that strategically moves the organization in the right direction.

Without strategic planning and a resulting plan of action, the organization will not have a clear idea of what it is doing, why it is doing it, and where it is going. If there are no goals and objectives in place to address stakeholder issues/concerns, improve programs/services, or grow the organization, it may not be able to continue meeting the needs of the very people it is supposed to serve.

In addition, the lack of a plan could compromise public trust, result in a loss of funding, or prevent the organization from pursuing new funding opportunities and partnerships. Without planning, an organization becomes stagnant.

 

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Strategic Planning

Strategic Planning – What it is and Why it is Important

Strategic planning is critical to a nonprofit organization’s future direction and survival. As such, it is important to understand what strategic planning is and why it is so important. This article provides a definition of strategic planning and why it is important to nonprofit organizations.

Wikipedia defines strategic planning as “an organization’s process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. ” Strategic planning is the formal consideration of an organization’s future course. All strategic planning deals with at least one of three key questions:

1. The first key question is “What do we do? ” This relates to the organization’s vision and mission. An organization’s vision is broad… it is the final goal the organization aspires to achieve. The organization’s mission is a statement describing how the organization is going to meet its vision.

For example, an organization’s vision might be to employ all persons with disabilities. Its mission might be “Through the provision of vocational counseling, job seeking skills training, and job development and placement, assist persons with disabilities to gain or retain meaningful employment. ”

2. The second key question is “For whom do we do it? ” The organization needs to be clear about who its clients are in order to develop or modify programs and services to meet their needs.

3. The third key question is “How do we excel? ” This question relates to how well the organization is doing and what it could be doing better to best meets the needs of its clients. It also reminds the organization to assess its competition and develop a strategy to be the premier agency in its field.

Although these three questions should always be considered when developing, modifying, or deleting programs and services, it is also important that they be addressed before and during the strategic planning process. The answers to these questions will help the organization to determine its direction, exactly where it stands, where it wants to go, and how it will get there. The resulting document is called the “strategic plan. ”

Strategic planning is a process organizations should engage in on an ongoing basis, regardless of the length of the plan. Some organizations engage in tactical planning, which is essentially a one year strategic plan. Tactical plans are developed when an organization is brand new or develops a new program or service that wasn’t included in the original strategic plan.

Generally, however, most strategic plans are 3-5 years. Although some plans could be longer, it is difficult to predict opportunities, threats, and trends in the field beyond three years. Whether the plan’s duration is one year or longer, the important thing to keep in mind is developing a plan that strategically moves the organization in the right direction.

Without strategic planning and a resulting plan of action, the organization will not have a clear idea of what it is doing, why it is doing it, and where it is going. If there are no goals and objectives in place to address stakeholder issues/concerns, improve programs/services, or grow the organization, it may not be able to continue meeting the needs of the very people it is supposed to serve.

In addition, the lack of a plan could compromise public trust, result in a loss of funding, or prevent the organization from pursuing new funding opportunities and partnerships. Without planning, an organization becomes stagnant.

Copyright 2010 © Sharon L. Mikrut, All rights reserved.

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Strategic Planning

Funeral Home Marketing – 5 Strategic Planning Myths

It’s that time of the year again… planning time.

It happens every year. Business slows down around Thanksgiving and we coast through the Christmas season. I like that predictable cycle because it gives me a chance to focus on my family and the spirit of the season.

As soon as we hit January all heck breaks loose as many funeral home owners suddenly decide that they were not satisfied with their 2010 numbers and it’s time to develop a new plan.

This year I received the first “I need some strategic help” email on New Years Day!

Even with the economy picking up a bit, 2010 was still a rough year for most funeral home owners. If their call volume was good, the margins were still smaller than they wanted and the bottom line suffered.

It’s pretty obvious… it’s time for a new plan.

In this article I am going to describe 5 strategic planning myths that are common among funeral home owners and managers.

Myth #1 – Families don’t have any money

There is no doubt that the economy has hurt a lot of families. Rampant unemployment, stock market ups and downs, and the crash of the housing market have combined to wipe out the nest egg of many families.

Why is it then that the average amount spent on a wedding in 2010 an all time high of $27, 852? That’s a 100% increase since 1990.

Why is it that while Chrysler and GM were in bankruptcy, the sales of luxury cars like Ferrari and Rolls Royce were at an all time high?

The reality is that some families do not have money. But an awful lot of families have plenty of money they simply don’t understand the value of a visitation and memorial service so they won’t spend their money on it.

The point is that designing your business assuming that no one has any money is a huge mistake. There are still lots of people with money and one of the goals of strategic planning is to figure out how to attract as many of those people as possible to your funeral home.

Myth #2 – If I just give it time… the business will come back

This is sometimes called the ostrich approach to business management… stick your head in the sand and hope the problem goes away.

I believe the funeral home market has fundamentally, and irreversible, changed over the past decade. This change is primarily driven by the fact that baby boomers are now making the decisions in the arrangement conference.

The basic nature of a baby boomer is that they always challenge traditions. They did it in the 1960’s, the 1970’s and they continue to challenge traditions today.

The fundamental problem is that most baby boomers do not understand the value of a funeral service. If they do not understand it…. they cannot embrace it…. and they will not spend money on it.

Very few businesses have the power to dictate the direction of the market (Apple is one of the rare exceptions these days). The rest of us have no choice but to constantly reinvent ourselves to satisfy the changing needs of our target market.

The first baby boomers just turned 65 and there are 76 million more on their way. It’s going to take 20 years for this wave to pass through the funeral home industry.

You could plan on just giving it some time. But a better plan may be to figure out how to serve the baby boom market so that your business survives to see the next generation.

Myth #3 – I just need to plan my advertising budget

Well you could… but you’ll probably end up wasting the money.

Many business owners think that marketing and advertising are the same thing. That couldn’t be further from the truth.

Advertising is a small subset of the overall marketing process. Advertising’s job is to make your phone ring. But marketing is focused on the entire revenue generating process. You don’t make money because someone called your funeral home. You only make money if you actually serve the family.

I like to start any strategic planning meeting by asking for the numbers. How many times did the phone ring? How many of those became a call for your firm? How many of those choose to have a visitation and/or memorial service? How many of those families referred others to your funeral home?

Studying these numbers tells you where the biggest problem exists.

Rather than planning your advertising budget you really need to plan every step in your marketing process and then determine what budget you need to support the entire process.

Making your phone ring is a nice first step… but it’s not going to pay your mortgage.

Myth #4 – All I have to do is copy the industry leaders

Every industry has their leaders. In the funeral home market there are a handful of very successful private firms that serve 1, 500 to 2, 000 or more families every year and operate a highly respected and profitable business.

As the recognized funeral home market leaders, these firms are studied carefully by the rest of the industry. Every move they make gets copied dozens or hundreds of times all over the country.

There’s one critical flaw in this process… what works in St Petersburg Florida may not work in Racine Wisconsin. And what works in Columbus Ohio probably won’t work in Portland Oregon.

We like to think of ourselves as a melting pot society but the reality is that we are far from being homogenous. Granted there are many similarities but there are also many significant differences. This is especially true when it comes to how a family deals with the death experience.

Direct cremation rates vary from state to state. But they also vary from city to city and even neighborhood to neighborhood (especially when you factor in the preferences of different ethic groups).

Copying the leaders in the industry will only work if their market and your market are identical. Otherwise, it’s a recipe for disaster.

The leaders are successful because they developed and implemented a strategic plan that was specifically designed for their local market. It may be an excellent plan but it will still have be customized in order to be successful in your market.

Myth #5 – Strategic planning can only be done at a resort

Why do the well-established funeral home marketing firms only make matters worse by encouraging their clients (i. e., you) to combine their strategic planning with a vacation?

Don’t get me wrong, I LOVE a good vacation. I also like it when I can make a portion of it tax deductible by combining it with an educational event (that’s not tax advice please consult your cpa).

Learn a little in the morning, join the family on the ski slopes in the afternoon… it’s not a bad way to spend a few days. The problem is that this is a horrible way to do strategic planning!

An effective strategic planning session requires three important elements.

First, it is always best to do your planning with the help of an outside facilitator. When owners try to do this by themselves, or with their management team, they always get bogged down on the details of one controversial topic and never complete the planning process.

The second important element is that the facilitator needs to have a game plan or agenda for developing the strategic plan. Creating a plan is a step by step process of defining your target market, analyzing this market, and designing your business model to deliver value to that market at a reasonable profit. Next, you have to define a marketing message and implementation strategy that will attract the right kind of families to your funeral home. Without a game plan for the meetings you may have some good ideas but you will never end up with a complete strategic plan.

The third element of a successful planning session is that the participants must be able to focus.

You absolutely MUST be able to focus on your business without interruptions in order to develop a new strategic vision and a plan for getting you there. As Michael Gerber says in his book The E-Myth it’s time to work “on your business” instead of “in your business”.

The vast majority of funeral home owners I have met are consumed working in their business; meeting families, conducting services and managing staff.

Creating a strategic plan requires you to work on your business; studying your market, designing your message and defining exactly how you will deliver something of value to your customers. Since this isn’t something you do every day, it is going to requires a focused effort.

When I’m working one on one with a client, I will typically suggest that we hold a two day planning session off site at a nearby hotel or conference center.

The goal is to get you away from your funeral home so that you can focus on the planning process rather than being distracted every time you hear the phone ring. I like to take a tour of your funeral home so that I get a better sense for your business but we should only hold the meeting there if you have a truly private area where you won’t hear the phones.

I have facilitated strategic planning sessions at resorts and it simply does not work. The participants all start out with the best intentions but by mid afternoon they’re thinking about what their family is doing outside of the room and planning their evening.

You can take your facilitator to the resort with you, he or she can bring their proven process with them, but expecting your management team to focus for two straight days in that environment is unrealistic.

To recap… the five big myths of creating a strategic plan for your funeral home are…

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Strategic Planning

Implementing Strategic Planning: Getting The Thing To Work

Strategic Planning has developed a bad name. Many organizations do strategic planning, but few are satisfied with the results. It seems that somewhere between the conceptualization and the execution, a serious melt down occurs.

Strategic Planning is an activity undertaken by an organization to identify priorities, and to develop and implement action plans to achieve those objectives. For the process of Strategic Planning in an organization to be successful, it must have the commitment of, and be driven by, the executive group.

The executive group not only must commit sufficient time and energy to the process, but also must make available the necessary resources required to implement the plan.

Developing A Strategic Plan

Strategic Planning begins by assessing the competitive landscape and identifying forces that will impact on the organization. Considerations might include changing technology, government regulations, ethics, customers’ requirements, suppliers’ capabilities, cost and quality pressures, substitute products, competitors’ behaviour, and human resources.

Emerging from this analysis, the organization will identify the factors deemed to be priorities and will formulate how it will perform in that future environment. This is the organization’s vision or desired state. Thus, the strategic plan is intended to transform the organization – to move it holistically to something different than what it is today.

A gap analysis then is conducted, in order to identify existing conditions that either will enable or constrain the achievement of the strategic priorities. At this point a detailed action plan can be developed. The action plan addresses:

what has to be done
who is responsible
when it is due
the resources required
how it will be measured
This action plan becomes the operating contract for the organization and its members. Unfortunately, at this point management often seems to think that all the hard work has been done, as the strategic plan is passed down to the departments for implementation.

Although management probably engaged the services of a consultant to facilitate the development of the strategic plan, rarely is such a provision considered for the implementation phase.

The Barriers To Implementation

Experience demonstrates that strategic planning initiatives often break down at the implementation stage. There are numerous reasons for this phenomenon:

the organization’s vision is too generalized
the organizational objectives are vague and unmeasurable
the organizational objectives fail to become translated into deliverable departmental objectives and activities
strategic priorities are stacked onto, instead of integrated into existing operations
there is no relief of workload
staff are unable to internalize the strategic priorities
there is a lack of consequence related to performance
inter-departmental barriers are not resolved
there is insufficient staying-power
Because of these factors, at the departmental level, the strategic plan becomes perceived as extra work.

In order to meet the organization’s requirements, departments spend time and energy inventing ways to demonstrate that they are contributing to achieving the goals of the plan. Thus, at the departmental level what often occur is counting. The strategic plan becomes transactional, rather than transformational.

The Departmental Approach

An integrated approach to implementation will ameliorate the barriers identified above and provide an organization with a platform for success. The recommended approach engages a single department in the process of implementing the strategic priorities in its area, with the assistance of a consultant to facilitate the process.

By working with a single department first, the activity can be singularly focused; peripheral issues can be identified, but actioned later; an early and visible success can be attained; and a model for implementing the strategic priorities in other departments can be developed.

The department to be involved should reflect the following:

leading edge orientation in relation to the strategic priorities
willingness of staff
capability for change
visibility and credibility within the organization
The Process

A facilitated team approach needs to be used. Team training probably will be a preliminary requirement, in order to ensure that the department achieves high performance.

The first step in the implementation process will be to define and detail the desired state for the department. This is the process of translating the organization’s strategic priorities into departmental objectives and actions.

Sufficient time and thought need to be dedicated to this activity in order to ensure that the strategic priorities are reflected and aligned properly and effectively. Performance indicators then can be developed.

A gap analysis then is conducted, as well as a business process improvement exercise. The business process improvement exercise examines existing and required business functions, always asking the following questions:

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Strategic Planning

Strategic Planning and Effects-Based Thinking: Part 1

As the name implies, effects-based thinking (EBT) is an approach to strategic planning and decision making where the effects of specific actions are assessed, not in a narrowly defined and time-limited way, but through a perspective that is sensitive to broad-ranging and lasting impacts.

Effects-based thinking is the opposite of short-sightedness or myopia.

Sadly, we have the ability to think about effects, yet we often don’t. In our fast-paced personal and work lives we tend to think more about today’s issues rather than tomorrow’s. Strategic planning objectives get pushed back further and further to accommodate those immediate concerns.

Modern organizations tend to exacerbate our naturally myopic tendencies by planning in small executive teams and passing down narrowly defined objectives and goals with little connectedness to overall goals.

Ironically, narrow strategic planning sparks our natural capacity for effects-based thinking. In the wake of some failed corporate plan, the water cooler conversations buzz with effects-based criticisms like, “Didn’t they realize that was going to happen? ” or “I saw that coming a mile away. ”

To some extent we are all effects-based thinkers. If you ever said to yourself, “I’m not going to stay up to watch the rest of this game because I won’t get enough sleep and I have a busy day tomorrow.

” Or, if you decided to enroll in graduate school to get an MBA so that you would have better career options, then you are certainly thinking about effects. In this sense, effects-based thinking is a fundamental human trait in our strategic planning processes.

We envision some future or some goal, or we analyze some set of choices or actions and we think forward through a chain of cause and effect to make decisions. Thinking about effects is part of our nature as humans.

However, few individuals or organizations utilize effects-based thinking systemically. Such an organized, process-oriented approach is what we mean by effects-based thinking. We partially define effects-based thinking as strategic planning and decision-making directed to shape an organization’s picture of the future.

This is only a partial definition because we must additionally consider what we know about complex systems – that they are inherently unpredictable and subject to rapid, even destructive change. Furthermore, actions can produce unpredictable effects and unintended consequences within complex systems – even with a comprehensive strategic planning initiative.

In complexity, the cause and effect sequence will always have some degree of ambiguity. Unfortunately, we’re stuck with the fact that no person or group of people has completely reliable predictive abilities about complex systems.

We also know that within complex systems, root causes of effects can be obscure. So, even with the benefit of hindsight, we may not know precisely what forces are at work to yield any given effect. Therefore, we must be ever vigilant about what is happening around us. We must also continually assess cause and effect in our internal and external systems.

Effects-based thinking is about more than just strategic planning by mentally projecting through a series of causes and effects. It is also about assessing the effectiveness and accuracy of our predictive planning. To truly think in an effects-based way requires us to think cyclically rather than linearly.

To be more accurate, effects-based thinking can be defined as a continuum of strategic planning and assessing the effectiveness of actions directed to shape an organization’s overall goals and objectives.

In other words it’s “how do we get what we want and how do we know we’re making the right choices to get it”. And that seems pretty simple and straightforward if it were not for this pesky problem within most organizations known as “execution”.

Organizations create plans that span the course of years. They call these plans “strategies. ” But leaders in organizations struggle to coordinate or orchestrate the execution of these strategies and utilize effects-based thinking.

One of the many reasons for this is that the strategic planning is often not well connected to the operational plans, or what military planners call “tactical plans. ” The strategic plan often spans a period of years while the tactical plans may only span a period of days, weeks or a month.

There is a missing strategic planning tier needed to bridge that gap – one that spans the multiple-month to multiple-year gap. Without effects-based thinking, the plans we carry out on a daily basis are hard to connect to the overall strategy that spans a year or more.

In that case then, how do you measure your progress in support of the strategy? And, even more importantly in this rapidly changing complex world, how do we know our strategy is still a viable one? Complex phenomena obscure our ability to determine whether our chosen course is correct.

So, what do we do? Do we just keep plugging along for months or even years until it becomes painfully obvious that our strategy is ineffective or needs adjustment, and then employ effects-based thinking?