By: Shawn Casemore
Have you found that sustaining a not for profit business model that is reliant on membership dues or private investment is becoming increasingly difficult to predict and manage? If so, you are not alone. With steadily increasing competition for member and sponsorship attention and interest, the predictability of these revenue streams is quickly eroding, taking along with it this once sound business model.
In my discussions with Executive Directors around North America I’ve found that the most significant question this evolution presents is how to achieve a vision of growth in the coming months, years and decade? Not a simple question, but it does point to a longstanding problem that many not for profits struggle with. Setting an agile and achievable vision.
As I’ve pondered this question I’ve dug deeper into understanding what the differentiators are between not for profits that are thriving versus those who are merely surviving. These two fundamental differentiators appear to be:
- Retaining and using their vision as a decision-making tool, and
- Pursuing their strategy as a “how-to” guide to achieving their vision
Interestingly these practices remain the same regardless of the size, region, or member demographic.
As I’ve researched deeper into this approach, I’ve found that the first step in this process is to overcome five significant roadblocks.
The diversity of a board brings value in the form of perspectives, but it also creates an increasing disparity between what board members believe members value and exactly how that value should be achieved. The most effective boards that I have worked with are very strategic about ensuring a balanced composition between senior board members (those of a longer tenure) and junior board members (those who have recently joined the board), ensuring an inbound trickle of new board members who naturally bring fresh perspectives, while still retaining the knowledge and experience of more senior members for stability and a historical perspective.
The second roadblock that I’ve found impacts a board’s ability to achieve its vision is spending too much time on introspection, or navel gazing. This is easily recognizable when a board spends the predominance of their time focused on improving how the association is operated, rather than considering what it is that members of the association desire both today and tomorrow. Getting better at doing the wrong things is not a recipe for success.
The future is, to a large extent, unpredictable. That is, unless you are willing to make educated decisions about what “might be” supported by prudent investments in pursuing what may lie ahead. Before Steve Jobs ever dominated the market with Mac, they brought the NeXT computer to the market. NeXT was, by all intensive purposes, a flop. An overpriced product that didn’t fit the niche it was intended to serve. But much of the software and hardware development that formed the NeXT computer platform went into improving Mac computers. NeXT was not a sunk investment, but an investment in the future of the business. As a not for profit it’s near impossible to be at the forefront of offering members value if you are unwilling to invest in prudent risk.
Lack of Strategic Strings
It’s typically not difficult to reach board consensus on the strategic objectives for an association. What’s difficult is reaching a consensus on where energy should be invested in order to deliver the results desired in as little time as possible. In order to transition from a strategic objective to a specific action, it’s necessary to identify strategic strings. These are the high level areas that require consideration in order to achieve the objective. Consider that an objective of “growing membership” may have Strategic Strings, including “identify what members value,” “improve speed by which member value is delivered,” and, “optimize how value is delivered.” All of these strings have different meanings, require different investments of time and resources in order to support the achievement of “growing membership.” Fill the gap between objectives and actions with strategic strings in order to bring clarity to what needs to be done, and how it is best approached.
Reduced Shelf Life
It used to be that grocery shopping was once per week, car shopping was once every five years, and career changes were once every decade. Those days have changed as our demands for “what we want and when we want it” have changed – significantly. We have grown impatient as a culture, and as a result our demands continue to evolve. This signals a need for a reduced shelf life of our strategy. We can no longer rest on a strategy that is three years old, as the pace of change is considerably higher than it was only five short years ago. Today, revisiting a strategy annually is necessary to ensure that we are investing our time and resources in the right areas in order to best serve our members.
In light of the best practices above, what are you doing to ensure that your nonprofit is positioned to thrive in the coming years? The way you developed and delivered your strategy previously is no longer acceptable.
Shawn Casemore is the President and Founder of Casemore and Co Incorporated, a management consultancy helping privately held companies and not for profits build a business that their customers and employees value. For more information you can visit www.casemoreandco.com or follow Shawn on Twitter @ShawnCasemore.