Nonprofits are more essential than ever before for the communities they serve. In the past year, 71% of nonprofits have seen increased demand for their programs and services, and nonprofit growth is essential to meet the need that exists in communities across America. However, almost half of all nonprofits do not have a strategic plan.
A strategic plan is essential for centering constituents, aligning stakeholders, making effective decisions, and laying the groundwork for sustainable nonprofit growth well into the future. While the sector has increasingly been trending toward shorter-term planning, especially in the uncertainty that has characterized the last few years, stepping back, taking a long view and building a flexible, adaptable plan for the next 2-3 years still has merit.
Here are six best practices for building a long-term plan for sustainable nonprofit growth and expansion. Consider which of these practices you need to put into action as you plan for the future to ensure you continue meeting your community’s needs, growing your impact and building an effective organization that meaningfully advances its mission for years to come.
Align your nonprofit’s growth plans with your organization’s vision, mission and values
Your nonprofit’s strategic plan should be built on the foundation of your vision, mission, and core values. These elements are the heart and soul of your organization, and any pillar, objective, key result or activity plan you choose to focus on should link directly back to these elements.
As you enter into long-term strategic planning, it may be necessary to:
- Ground yourself and your planning team in your nonprofit’s mission and vision. Your organization likely already has these elements in place, but it is essential to make sure they still feel true and current, and that they are top of mind for everyone involved in planning. In some cases, you might elect to refresh or completely overhaul your mission or vision statements before you enter into strategic planning, though this should be done only when absolutely necessary, as these statements are meant to stand the test of time.
- Reevaluate your core values. When you first launched your nonprofit (or when it was first founded), there were likely a set of core principles that guided the start-up process. Or perhaps your organization went through a formal process to establish core values years ago. As with mission and vision, your nonprofit’s values should be re-evaluated and kept top of mind as you enter into strategic planning. In some cases, you may find you need to make adjustments as your organization grows and changes. If you find this to be true, ensure you include a diverse group of internal stakeholders and constituents in the process, as values are meant to represent the principles held dear by your entire staff and universe of stakeholders, not just your leadership team and board.
- Develop a Reason for Being. A Reason for Being is an internal aligning statement that articulates the specific impact only your organization can make; it describes your unique purpose or why your organization exists. Developing a Reason for Being can lend powerful clarity to the strategic planning process, giving your planning team a clear directive about what your organization intends to focus on.
Center constituents and involve other stakeholders into your planning process
Your nonprofit exists to serve your community members, so it only makes sense to involve them heavily in your strategic planning process, learn about their needs, and get their ideas about opportunities for long-term growth. Input and support from your community will help you create a plan that works for them, and isn’t that the whole reason your nonprofit exists in the first place?
The Shared Power Strategy approach ensures that stakeholders are involved at every step of the strategic planning process, allowing them to share insights from their unique perspectives. We recommend using a combination of approaches to center stakeholders in the planning process. You can:
- Survey stakeholders
- Host listening sessions, focus groups, or interviews
- Create a stakeholder committee to weigh in on your strategic planning process and involve the committee in your strategic planning retreat
- Share quarterly impact and progress reports with stakeholders and ask for their feedback
Collaboration with stakeholders should be an ongoing process. For example, you might plan monthly committee meetings with an advisory council or field or quarterly surveys. Use their insights to iterate as needed, and keep your stakeholders informed on how their input is being utilized along the way.
Evaluate your finances and focus on high-return activities that will support nonprofit growth
An honest and thorough financial evaluation should be part of every strategic planning process. Your focus here will depend on your organization’s model and goals, but most organizations can benefit from doing the following:
- Determining the ROI for various programs and events. Assess the ROI of each of your programs, services, events and core offerings by subtracting costs from revenue and dividing by costs. For example, to calculate the ROI of your yearly fundraising auction, deduct the costs of running an event from the total donations raised through the experience, and divide that total by the costs.
- Considering eliminating low-ROI activities or replacing them with more cost-effective, productive options. For example, if you determine that your annual fundraising 5K is a major yearly expense and doesn’t generate a very high ROI, you could eliminate it from your events lineup and replace it with higher-impact activities.
Run ongoing ROI analyses to ensure your programs, projects, and events remain profitable and useful for your goals.
Consider whether you need to diversify your funding streams
The vast majority of strategic plans we’ve worked on recently have included a pillar focused on diversifying and strengthening funding streams. As you enter into strategic planning, consider whether this needs to be part of your long-term plan as well.
Recently, Giving USA 2024 illuminated several trends regarding nonprofit revenue streams that underscored the need to diversify funding sources. Giving by individuals dropped slightly in 2023, according to the Giving USA data. It still remains the largest piece of the total giving pie, with 67% of total nonprofit donations coming from individuals, but that downward trend is a worthwhile reminder that individual giving shouldn’t be your organization’s only fundraising focus.
Your nonprofit’s revenue streams should include all or most of the following channels:
- Individual small and mid-sized donations
- Major gifts
- Planned gifts
- Corporate sponsorships
- Grants (corporate and foundation)
- Event donations, such as gifts from recurring events like silent auctions or galas
- Government funding
- Revenue generating programs and services
- In-kind donations
If that’s not the case, consider how you might build out a strategic plan pillar to address it. The more you diversify your funding streams, the better positioned your nonprofit will be to face challenges with resilience.
Strengthen and empower your team
Your nonprofit’s team of employees, board members, and volunteers work together to advance your nonprofit’s mission. As you enter into strategic planning, consider whether your long-term plan may need to involve any of the following areas of focus in order to better position your team to do their best work.
- Team growth. Is the size and structure of your nonprofit’s staff sufficient to support your goals? If not, what head count and skillsets are necessary to carry out the other pillars in your strategic plan? Once you’ve defined needs, consider whether you must devote more time and resources to ongoing recruiting and hiring. You may even hire a recruitment or hiring manager to help accelerate the process.
- Engagement and retention. Staff members, board members, and volunteers all play unique roles in carrying out your strategic plan. Improve team retention and engagement by recognizing their achievements, both privately and publicly, and empower them to perform their duties at the highest level with comprehensive training and support.
- Career pathways and succession planning. As you plan for the future, are you establishing pathways into leadership positions through regular training, professional development, and promotion opportunities? Are you planning for the succession of your executive director or other key leaders? If not, consider whether these activities might need to be elevated to priorities in your strategic plan. Even the best strategic plans fall apart when the people working to bring them to life leave and cannot be effectively or efficiently replaced.
Creating a positive experience for your internal staff, board members, and volunteers is key to retention. 41% of workers who left their jobs in 2023 said poor engagement and workplace culture were the driving factors. By emphasizing effective staffing, team recognition, and succession planning, you can create a more positive workplace environment that exceeds employees’ expectations and reduces turnover.
Make effective use of technology to support nonprofit growth
Your nonprofit’s technology setup and software solutions are also vital for building your organization’s capacity and carrying out its strategic plan. To ensure they’re set up to support your team and plans, take some time during strategic planning to:
- Ensure your software solutions integrate. Bloomerang’s nonprofit CRM resource recommends seeking CRMs that integrate with top solutions like your fundraising platform, event and marketing software, prospect research solutions, and accounting tools. Integrations ensure that you can seamlessly share your organization’s data across platforms, reducing data silos. This connectedness allows you to always have access to the supporter information you need to personalize your communications.
- Use technology to better understand your people. For example, tools like volunteer management software help track volunteers’ personal information, such as their contact details, addresses, and years of involvement with your organization. You can also use this tool to understand volunteers’ preferences and additional interests, such as their preferred programs to volunteer with or past fundraising campaigns they’ve supported. This information allows you to tailor your volunteer outreach to speak to each individual’s interests and motivations.
- Provide adequate training to empower staff members to use your software tools effectively. Your software solutions should support the on-the-ground fundraising efforts your team members are pushing forward. Host regular training sessions to share strategies and advice to ensure employees feel comfortable using these solutions to their fullest extent. For example, you could host monthly CRM debriefing meetings to share best practices and tips across the team.
For more inspiration, review examples of other nonprofit strategic plans to see how other top-performing organizations are preparing for the future and planning for nonprofit growth. Specifically, pay attention to how other nonprofits incorporate stakeholders into the planning process, create opportunities to adjust their plans as needed, and strategize for long-lasting financial sustainability. Then, combine learnings from their successes with these best practices to ensure a successful long-term strategic planning process.
