A Step by Step Guide to Strategy and Business Planning
Our most recent Skills Survey showed some interesting results when it came to strategic and business planning with 31% of the charities responding reporting not having a formal business plan. Business planning was also the area which was identified as requiring the most development for small charities in the management section of the survey.
There are obviously numerous benefits to having clear strategic goals but sometimes this gets subsumed by the day to day work of an organisation. At a recent conference when presenting on this subject I asked the room how people had started a business plan and never finished one. About ¾ of the room (including me) raised their hands.
There are different strategies you can have, and whilst there is no right or wrong way, we would recommend the following structure:
The organisational strategy sits at the top and shows the longer term plans for the organisation. The business plan and budget detail how this will be delivered year to year. It is important that the fundraising strategy underpins the business plan and not the other way around i.e. you raise money to deliver your strategy, and don’t raise money and then consider what you can deliver with it.
Below is a simple 10 point plan which will help you with the process of developing a strategy and business plan:
1. Get the team together
Gather views and opinions far and wide. Think about who will be involved in delivering the plan, getting them involved will be a great way to empower them to help deliver it.
City Bridge Trust have gone through a really engaging and interesting process during their strategic review which you can see here including some excellent blogs by Sufina Ahmad who ran the process
2. Define the process
Why are you doing this? Who is responsible for producing the plan and who will be responsible for delivering various areas of it? Think about timescales, processes and any outside help you might need.
3. Set the mission
Now set the overall direction of travel and make sure this aligns with your charitable objectives. What is your overarching objective for your organisation over the next 3 to 5 years?
4. Explore the current situation
Think both internal and external. A SWOT analysis (Strengths, Weaknesses, Opportunities and Threats) is a good way to think of both sides, and the good and the bad.
Also look at the need for your work and your beneficiaries. Has this changed? Do you need to adapt?
When considering external drivers, the Facing Forward report from Lloyds Bank Foundation asks how charities can adapt to survive and considers the ten trends to watch (ranging from technological changes to Brexit) and also gives tips for charities when preparing for the future.
5. Set the goals to reach the vision
Put together SMART (Specific, Measurable, Accountable, Realistic and Timebound) objectives to deliver against the mission. The majority of these should be focussed on your charitable work with one or two focussed on your organisation in areas such as finance, governance or workforce.
Now it is time for a little more detail. How will you deliver these objectives? What are the specific tasks and activities which will help you achieve them?
7. Gap analysis
What are you missing? Are there areas you should be covering? Do you need more resources to deliver this?
Probably a whole blog in itself but this plan can be used to develop a detailed budget (including full cost recovery budgets for projects) which can then be used to develop the income generation plan
Risks will underpin a lot of the areas above so ensure you have considered both their likelihood and impact. You can then look at what you will do to address these. There is excellent guidance on risk management from the Charity Commission here.
10. Monitor and review
Now you have written the plan (!) make sure you have a process to check against it. It should be a ‘living document’ and updated against the situation going forward.
Hopefully, this will help with the process. There is no right or wrong structure for a business plan or strategy but if you cover all of these points we believe you will have considered everything you need.