Business Planning for Nonprofits

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Business Planning for Nonprofits

• Mount Wachusett Community College
• May 24, 2005
• Presented by Lisa Derby Oden

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Business Planning for Nonprofits

• Strategic Planning Business Planning
• Purpose
• Components
• Overlap and differences
• Organizational Lifecycle
• Business Plan Core Elements
• Marketing Public Relations
• Operations
• Human Resources
• Financial
• Nonprofit Business Plan Examples
• Break-out Sessions
• Resources
• Evaluation

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Strategic Planning v. Business Planning

• Strategic Planning
• Adaptive activity by which a nonprofit
  continuously tries to assure its
• future relevance.
• Ongoing process whereby those responsible for a
  nonprofits success
• attempt to define its desired future and
  set the course for making it
• happen.
• Usually intended for internal users, and are
  seldom shared with outsiders
• except in publicly funded entities.
• Encompasses nonprofit as whole entity.
• Alice in Wonderland asks the Cheshire Cat, Which
  way should I go?
• That depends a good deal on where you want to
  get to, said the Cat.
• I dont much care where, said Alice.
• Then it doesnt matter which way you go, said
  the Cat.
• If you dont know where youre going, then any
  road will take you there.

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Strategic Planning v. Business Planning

• Business Planning
• Usually for an external audience primarily
  used when seeking funding.
• Business plans assume the presence of a
  strategy and are more concerned
• with action consistent with a strategy.
• Typically more centralized in terms of
  participants than strategic planning.
• Business planning may be concerned with a
  single program or with the
• provider's entire services mix.
• Business planning is a lot cheaper and more cost
  effective than trial and error.
• Mike Burns BrodyWeiserBurns

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Graphic by Lisa Derby Oden
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What is your Strategic IQ?

• Give yourself "10" for each unequivocal YES, "5"
  for each equivocal YES, "0" for each NO or DON'T
  KNOW.
• a. You have a clear mission statement, a
  challenging vision statement, and a meaningful
  and practical statement of your agency
  philosophy.
• b. You have a current strategic plan based on
  your mission, vision, and philosophy and on a
  realistic assessment of your competitive
  environment.
• c. You routinely involve owners, board and PAC
  members, consumers, staff, and other pertinent
  stakeholders in your strategic planning process.
• d. You use your strategic plan in meeting
  competitive challenges, in considering business
  opportunities, and in responding to changes
  within your market.
• e. You demonstrate accountability for achieving
  as well as not achieving stated strategic
  outcomes within the defined time frame.
• Thanks to HCMA, Ltd. for this Strategic IQ
  assessment

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Organizational Lifecycle
From the Enterprise Foundation
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Business PlanComponents
Vision
Mission

• Executive Summary
• Vision Mission Statements
• Objectives
• Operating Environment
• Target market
• Competitive Analysis
• Marketing Plan
• Operations Plan
• Human Resource Plan
• Financial Plan
• Appendices

Objectives
Market Research Target Market Competitive
Analysis
Operations Plan
Marketing Plan
Human Resources Plan
Financial Plan
Diagram from Managing the Double Bottom Line by
Sutia Kim Alter
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Business Planning
What you aim to achieve through your marketing
plan Attributes that set your nonprofit
apart Features and benefits of your services,
programs, or products How you get your services,
programs or products to your clients -
distribution How you establish price or
fee Your promotion plan and the marketing PR
tools you use How you turn prospects into
clients -sales

• Executive Summary
• Vision Mission Statements
• Objectives
• Operating Environment
• Target market
• Competitive Analysis
• Marketing Plan
• Operations Plan
• Human Resource Plan
• Financial Plan
• Appendices

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Business Planning
Operations process, capacity and
productivity Analysis of human resources,
equipment, time and space needs and
costs Quality control through staff performance
evaluations, client satisfaction surveys, needs
assessments Evaluate market response by
determining outcome measurements Scheduling,
MIS, internal financial controls

• Executive Summary
• Vision Mission Statements
• Objectives
• Operating Environment
• Target market
• Competitive Analysis
• Marketing Plan
• Operations Plan
• Human Resource Plan
• Financial Plan
• Appendices

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Business Planning
Organizational chart showing management
structure, line managers and support staff Job
descriptions for key staff and management Determi
ne all human resource needs Determine where
leadership lies board, senior management, lead
organization, other Role of board of
directors Performance and incentive plans for
staff Training needs for staff Human resource
budget

• Executive Summary
• Vision Mission Statements
• Objectives
• Operating Environment
• Target market
• Competitive Analysis
• Marketing Plan
• Operations Plan
• Human Resource Plan
• Financial Plan
• Appendices

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Business Planning

• Executive Summary
• Vision Mission Statements
• Objectives
• Operating Environment
• Target market
• Competitive Analysis
• Marketing Plan
• Operations Plan
• Human Resource Plan
• Financial Plan
• Appendices

Funding history Annual budget Quantify social
costs Balance sheet Cash flow
projections Funding source list Sensitivity
analysis contingency plans Exit plans