A look at mission plans vs. business plans for nonprofits

There is so much discussion in and outside the nonprofit community about “running the organization more like a business.”  I heard a very interesting comment about this by David Greco of the Nonprofit Finance Fund while attending the Grantmakers For Effective Organizations (GEO) annual conference in Seattle.

He said that nonprofit organizations exist because the “For Profit” world has not met certain needs or there isn’t a sustainable business model to warrant capital investment in the need. As an extreme example, it would be challenging to create a for-profit business model eliminating homelessness.

I have also heard reservations that nonprofits struggle to create "business plans". After listening to David and others, it occurred to me that a much more appropriate annual document and process would be the creation of a Mission Plan.

I then came across an alliance of three organizations called Charting Impact. This alliance includes BBB Wise Giving Alliance, Guide Star USA and Independent Sector. At the heart of Charting Impact are five deceptively simple questions that require reflection and promote communication about what really matters, both the Mission of the organization and results.

Those five questions are:

1. What is your organization aiming to accomplish?
2. What are your strategies for making this happen?
3. What are your organization’s capabilities for doing this?
4. How will your organization know if you are making progress?
5. What have and haven’t you accomplished so far?

The process of answering these questions as well as determining the underlying funding known to be available and creating a strategy for the unfunded portion of the needed resources would constitute a “Mission Plan.”

The very process of engaging staff and board members in answering these questions will bring clarity to the roles and allow board members in particular to know how best they can either volunteer or help bring resources to the organization.

An easy acronym for goal-setting is SMART, which stands for:

• Specific – What do we want to accomplish, exactly? An example of a general goal is, “we hope to improve our top-of-mind awareness among the public.” An example of a specific goal is, “60% of the public will be aware of our organization by the year 2015, as measured by public opinion polling.”

• Measurable – The second is measurable, meaning your organization would know when you had achieved the goal. Ask yourself questions like, “How many?” “How much?”  “How will we know we achieved it?” when determining if a goal is measurable or not.

• Attainable – The most important question to ask to ensure if a goal is attainable or not is, “Can we figure out ways to make it come true?” If an organization can figure out the ways to make it come true – the strategies – then it will be able to attain the goal within a timeframe that allows the organization to work toward the goal, even if it is several years in the future.

• Realistic – To be realistic, a goal must represent something you are willing and able to work on as an organization. Remember that goals that are not sufficiently challenging represent “low motivation” in organizations. Frequently, it is easier to achieve goals that appear more aggressive because they capture the imagination, energy and excitement of the people within the organization and these stakeholders are motivated to work toward the goal.

• Timely – Without a timeframe, there is no sense of urgency to reach a goal. In order for an organization to be high performing it must continually focus on improving. I hope the information above and the links provide useful tools for you to help those organizations and causes you care most about to thrive.