Creating a Non-Profit's Strategy

Introduction

The following is an example of Mind-Mapping and prioritizing strategy.

I’ll use a real example to illustrate the process. Please note though that this is just an illustration, since the future direction of this project is still an active community discussion--no definite direction has been set for the project. But, I though it was a good illustration of how the process could be used on a non-profit project.

North Star House exterior, 1904 designed by Julia Morgan (photo courtesy of the Foote Family Archive)

North Star House exterior, 1904 designed by Julia Morgan (photo courtesy of the Foote Family Archive)

This is the North Star House, designed in 1905 by the famous Julia Morgan, California’s first women architect and designer of over 800 buildings, including the Hearst Castle at San Simeon. The North Star House was built in Grass Valley as the Foote Family home at the North Star Gold Mine. The house was designed and built for the North Star superintendent Arthur De Wint Foote and Mary Hallock Foote, the well-known author and illustrator of the West

North Star House interior, 1904 designed by Julia Morgan (photo courtesy of the Foote Family Archive)

North Star House interior, 1904 designed by Julia Morgan (photo courtesy of the Foote Family Archive)

The problem statement is simple... the house and historic site fell into disrepair in the 1980’s, it has been placed in caretaker status by a local non-profit, and there are ongoing discussions about the future use of this important historical asset. What are the possible end-use alternatives and what process could be used to reach consensus?

The decision process I’ll illustrate involves deciding on a possible end-use or end-state for the project, this is based on a set of overarching objectives for the project... Then I’ll show how an execution strategy might be formed, and where to focus the limited resources based on the strategies that generate the greatest benefit. We’ve applied this process to corporate strategy formulation, but this is the first time we have used it in a non-profit application.

Determine direction

First, lets choose a direction to head in terms of a ten year vision for future use of the historic site. Again, this is just an example and the future of this project has yet to be determined. For this to work in practice, all the stakeholders will need to participate in the process.

I have set the goal for this decision model “to select a direction in order to secure funding.” It is hard to raise the estimated 10 million dollars for this project until the end use is defined. In a sense, this has been the problem the board has faced for the past five years.

Next I’ve defined five broad objectives for the project. In order to give these objectives a weighted value, I have gone through a process of pairwise comparisons for each objective.

In this case I have favored economic value over the arts venue objective. This comparison was done for each objective. This is critical to get right, since this is what influences the ranking of the alternatives later in the model.

I’ve brainstormed a list of seven end use alternatives. There are most likely 15-20 of these that need to be considered. This is an important brainstorming step where we use many creative thinking techniques, such as lateral and challenge methods.

I’ve chosen a simple QFD 1, 3, 9 rating scale to determine how much each alternative contributes to each objective. This then gives me a priority for each alternative. In this case 100% is the winner. It shows me the proportional relationship between the alternatives. My winner is almost twice the next alternative candidate. This is a fascinating process to facilitate with a large group of passionate stakeholders.

Now I can do sensitivity analysis to see what happens when I change the weight of each objective. Notice that if the local arts venue was the key project objective, then the end use changes to restoration (versus preservation) and it becomes a community center for the arts rather than a state park. The winner is a function of the objectives that are sought. Get the objectives right and the solution is clear. Most people can agree on the objectives, but disagree on the alternative choices. This process focuses people back on reaching agreement on the objectives first.

Map the execution strategy

Assuming my “winner” is the state park alternative, here is a strategy execution map that outlines the ten year vision for the project. The vision is where you are going, the goals are the incremental steps to getting there, the strategies are the way in which we will get there, and the programs are the specific actions to generate results.
You can see my overall project objectives are presented here again for reference. This is what I am trying to achieve through this strategy.

I’ve defined a set of goals to be achieved. Each goal is broken down into a series of strategies, and then programs to execute the strategy. This is a critical team building and consensus process to brainstorm these elements of the model. Ownership is also important to identify for each of these goals. In this case, each board member would own one of these goals and would engage a small team of volunteers to work with, in order to make them happen. Later, this information would be the basis for a schedule to track progress.

This is what the high-level view looks like with the ten-year vision in the center, surrounded by the six goals, and overall project objectives to be achieved. Most projects we see lack this basic framework and as a result, lack direction and focus. This is especially critical for public projects like this--to have this level of visibility and transparency in decision making and direction is critical.

Prioritizing the strategies

These are the end-use alternatives, and in the same decision model I have prioritized the strategies using the same set of project objectives.

These are the various strategies, organized by goal, from the mindmap. Then I followed the same procedure of ranking the alternative strategies as to how well each met each project objective. This gave me a prioritized list of strategies with the winners being the strategies that best met the highest ranked project objectives.

Now, lets look at the impact of constraints on the model. In this case I used cost estimates for each strategy. Cost is always the primary constrain in any non-profit venture. Like all resource constrained projects, especially non-profits, the challenge is to do more with less--and make sure you use the limited resources where you can get the greatest value.

In this case my estimates roll-up to 10.8 million dollars. If I had this money and could fund all of this work, I would have achieved 100% of the project objectives and realized 100% benefit.

Looking at this on a curve, I can see that at about 3.8 million dollars I get about 85% benefit with only 35% of the proposed budget. I have a lot of lower cost, highly ranked strategies.

Notice that the next jump in project spending does not really get me more benefit. Clearly these programs can be delayed until later in the project. But this funding schedule follows my proposed strategy of restoration and local use for the first five years, followed preservation and transfer to park status during years 5-10 of the project horizon.

I can also play the game of constraining the budget to see which strategies and programs get funded with the constrained budget. In this case I set the budget constraint to 2 million dollars. This drops my benefit to about 70% and I need about 1.8 million dollars to do the strategies in yellow. The white ones must be delayed until more funding is obtained.

I have a dynamic model to simulate alternative directions for the project, and then once the project direction is selected, a way to map the execution of the strategy and a way to show how funding constraints guide the priority of work flow on the project, i.e. where to focus to get the greatest benefit.