Five Elements for Successful Strategy Execution in Nonprofit Organisations

The start of the year provides a golden opportunity to check on the health of your strategic priorities and refine practices to more consistently deliver on your long term goals. To be clear, I am not talking about your whole program of work, just the small number of strategic projects that will have a transformational effect on the organisation and your long-term impact.

No matter the type of initiative (e.g. digital transformation, culture change, new service) or size of the organisation, the following five elements are crucial to successful strategy execution in nonprofit organisations.

5 Elements of Successful Strategy Execution in Nonprofit Organisations

1.      Clarity and Agreement

It sounds obvious to say that Executive (or Board in the case of volunteer-led organisations) clarity and agreement is required.

In my experience, while this is often true in terms of the overall portfolio of strategic initiatives, much can be improved in terms of the agreed priority of each based on its contribution to the organisation’s long term goals and the recognition of the trade-offs this will require. In many organisations, this may happen at the time of the strategy development or at best in yearly reviews but is often lacking throughout the year. In the current rapidly changing environment, it is essential to be agile in reprioritising if required.

Where this does not occur, I have often witnessed ever expanding lists of strategic projects, and large divisional projects competing for organisational attention and resources. I also see new priorities being added without reassessment or readjustment of other priorities.

There are multiple ways to prioritise your strategic workload. Stripped down to the essentials, Boards and Executives need to compare and prioritise what will be done when based on alignment to long term goals, feasibility, level of risk, benefits vs costs and estimated time to completion.

At an individual strategic initiative level, the Executive team needs to understand and agree on project sponsorship, deliverables, scope, expected benefits, change impact and investment/resourcing impact for each area. The form this takes is less important so long as it is easily understood, agreed and available for reference. The simpler the better! Insufficient clarity and agreement increase the chance of scope creep, organisational friction, resources not being freed up and mismatch of project outcomes to expectations.

2.      Accountability and Traction

While cross functional steering committees work well for individual strategic projects, the Executive team plays a crucial role in overseeing the performance and make-up of the portfolio of organisation-changing investments. The Executive is responsible for rapid decision making, championing of initiatives, removing road blocks and freeing up resources.

All nonprofit organisations no matter their size can establish regular mechanisms at an Executive team level (or Board level for volunteer-led organisations) to action, evaluate and review progress on the strategic initiatives. These include:

• Regular, succinct dedicated time allocated in meetings to the strategic initiative portfolio (e.g. once a month half an hour to one hour for decisions that affect the whole organisation or roadblock removal)

• Clear roles and responsibilities of the Executive for this portion of the meeting (e.g. brief guiding principles or terms of reference to ensure an organisation and outcomes perspective is kept front of mind)

• Timely, short report that identifies key decisions to be made, progress against outcomes and road blocks to be resolved.

• Regular review of environmental, market, organisational or project changes that require changes to the prioritisation of initiatives (e.g. quarterly review of priorities)

These mechanisms can be customised to fit how your organisation and Executive operate.

Lastly, there should only be one Executive sponsor per strategic initiative to avoid dilution of accountability.

3.      Engagement and Understanding

More than most organisations, non-profits face a complex environment of internal and external stakeholders and are held to a higher social standard. External stakeholders are numerous including clients, communities, peak bodies, partners, collaborators, referrers, funders and government agencies. Therefore, it is key to fully identify all the stakeholders that might be affected, the level of impact of potential changes and their level of interest. From a leadership perspective, the Executive team needs to understand the impacts for each project as well as the cumulative effect of the portfolio of priorities on stakeholders.

The drive for engagement (in addition to communication) needs to be championed by the Executive, starting at the earliest possible stage. For each individual strategic project, the level of engagement and understanding of stakeholder should be consistently monitored with major changes in sentiment brought to the attention of the Executive.

From a practical perspective, prior to project approval ensure that each strategic project has a comprehensive list of stakeholders and major impacts on stakeholders are understood.

4.      Structured and Resourced Execution

Structured execution means using project and change management methodologies adapted to fit the organisation, type of project and key people undertaking the project. These should be as simple as possible, considering the complexity of the project and size of the organisation. For very small organisations, all that is needed is an explicit plan, including timeframes and accountabilities, and a way track the completion of tasks and project outcomes.

Change management is often overlooked and yet by definition, strategic projects bring transformational change. Underinvestment in change management may cause project failure, delays, reduced benefits and broader stakeholder ripple effects. For example, McKinsey[1] indicated that for every dollar spent on digital solutions, another $1 investment in change management is required, increasing to $3 of change management with AI initiatives, to ensure users are engaged and have the capabilities to use the technology.

Non-profits often have senior leaders managing major initiatives as well as their day jobs. Project and change management assistance is often lacking and change management occurs to the best of the leader’s abilities. Subject matter experts are pulled in many directions and may not be available for the strategic project, causing delays. This impact needs to be recognised, managed and monitored by the Executive Team to avoid burnout. For your most transformational projects, effective investment in project and change management, either through skill building or personnel can make a significant difference to organisational outcomes.

5.      Leadership and Workforce Capabilities

Like change management, training for those affected by the project is often underdone and not regularly undertaken after the projects are completed. While this is a known issue with technology projects, it is equally important for other projects such as the implementation of new services where training needs to persist after the end of the project to ensure fidelity to the service design.

Across the nonprofits I have worked with along my career, very little attention has been paid to providing leaders, senior leaders and Executives with skills necessary to develop, manage or sponsor projects. It has been good to see the increasing inclusion of change management training, given the key role played by leaders in undertaking change management activities. These are necessary skills for all leaders and would be helpful to invest in as part of leadership development.

In closing, consistent oversight and active management of these five elements will enable greater progress towards your organisation’s strategic goals.

Dr Estelle McDonald is the Founder and Principal at Growth Seeds Consulting and specialises in growth, strategy and execution for nonprofit organisations.

[1] McKinsey (May 2024). “Moving past gen AI’s honeymoon phase: Seven hard truths for CIOs to get from pilot to scale.” https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/moving-past-gen-ais-honeymoon-phase-seven-hard-truths-for-cios-to-get-from-pilot-to-scale