It’s Strategic Planning Season: Make 2015 About Sustainability

‘Tis the season to be planning…
or budgeting…
or … wandering …
Summer holidays already seem a year ago and the planning and budgeting season is no longer something that’s coming ‘next year’. It’s that time of the year where we typically all try to keep business as usual ticking along, keep pushing along those special projects, and settle in to some good old fashion budget setting and planning.

For some its ‘last year plus 20% more please’…. A little Augustus Gloop-ish.   For others, the call of ‘there must be a better way’ sweeps us off our feet and off to strategic planning retreats. Hopefully there’s one tidbit we can latch on to but are often resigned to the creation of another PowerPoint deck.

However, this year is a little different.For all of us who work in and with the NFP sector we know “the times they are a-changin”. There is no point regaling you with all the factors at play. Suffice it to say, funding is hard and getting harder. So what’s changing?

The sector is now not just talking about, but investing in, the exploration of sustainable business models. That’s what’s changing. There is a real sense of momentum. It’s at the point where the conversation turns from ‘what if’ to ‘how to’ – Where it becomes harder to swim against the tide than move with it.
So catch this wave. Make this season the one to start seriously addressing long-term financial sustainability. Don’t only talk about funding models or fundraising this year. Talk about your business models. If you only do one thing differently – talk about your business models.

Whether your company hosts a formal planning session, a 2-day retreat or just updates last year’s numbers, dedicate a minimum of 25% of your planning time to exploring and stress testing your future business model and sustainability and see what funding models appear.In a recent editorial of mine I ran through a few tools and techniques that will help you guide your team on the sustainable business model journey:

1. It’s time to start from a different place

Put some things on the bench – don’t do SWOT, PESTEL, environmental analysis yet. Also bench quantitative analysis – revenue lines, price per service, funding per person. We will go through these – but later on.

2. Redesign around what social problem you will solve

  1. What’s your Value Proposition? What’s your Impact Goal? Question what problem you exist to solve (or will have solved in 5 years) with your customers, stakeholders, partners. This will generate modifications to existing services and may uncover new ones. Be prepared to let go (in the workshop at least) of the major current funding source in pursuit of delivering value (the key to sustainability).
  2. Using tools like the acclaimed Business Model Canvas, develop a business model around these value propositions & services.

3. Go even further

  1. See if digital innovation can fundamentally transform either the external or internal dimensions of your organisation – or both.
  2. Run same logic over partnerships. Outsource, co-source etc.
  3. Look to innovative payment models to not just alter your funding stream but as a way to keep you afloat.

4. Break your new model

  1. Use old school strategic planning tools to try to break your shiny new model. These tools have a place and it’s right here.
  2. Get your Excel on! Model our your changed and new income lines, weave in your expenses and use your innovative payments ideas to massage the cash projections.
  3. Develop an appropriate budget. Run through some scenarios: shoestring, surplus, steady.

5. Find, and then Line up, the ducks …

  1. Create your roadmap/action plan. Try a simple three step mode for creating usable roadmaps
    • Get down all the projects you need to do to reach a sustainable model
    • Sort them into the four rows Financial Projects, Client Projects, Internal Projects and Growth & Development Projects (thanks, Balanced Scorecard!)
    • Sequence them into three columns, this year, next year and later. No one really keeps the roadmap past two years anyway so this little technique keeps the team happy that they have been heard but pushes less important projects backwards.
  2. Chose no more than 2 projects per year per category… doing less can be more
  3. Most NFP’s don’t have one or both of these skills: Commercial / Business development OR Technology. Find them. Secure them. Put them to work.

Set the cultural tone and tempo to one of change and engage already well-documented change management techniques.The transformational journey to sustainability is as uncomfortable as it is inevitable.  Delaying the outset isn’t just lazy – it’s irresponsible. 2015’s planning season is the one to be taking the first step towards a sustainable business model. There is a large and growing community of organisations that have already begun. It’s time for you to embark.

 “It’s a dangerous business, Frodo, going out your door. You step onto the road, and if you don’t keep your feet, there’s no knowing where you might be swept off to.”
J.R.R. Tolkien, The Lord of the Rings

Step out with purpose. Keep your feet.

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