Every organization wants to survive and prosper. To do so, it must respond and adjust to the social, economic and political environment and the changes therein. Changes in the outside environment occur constantly, even in stable societies, for example as a result of technological advancements or new economic policies (e.g., open market). Strategic planning is therefore a necessity in every kind of organization, be it an NGO, a government, community, political or business institution. The idea of strategic planning emerged in corporations that wanted to have a strategy on how to maximize their profits. Today, the motivation is manifold and differs according to the type of organization.

In Bangladesh for example, NGOs are running the country. After the 1971 war and subsequent independence, foreign funders went directly to the NGOs rather than to the government, which was very unstable and changed every few years. As a consequence, after almost 20 years, NGOs run almost all affairs of the society, including the provision of health and education services. To a certain extent this is good, because NGOs generally and naturally work with the grassroots and, thus, are reaching all segments of society. On the other hand, this made the Bangladeshi government withdraw completely from providing services, including formal education in some areas. Ideally, NGOs should work as a supplement to the government, which must fulfill its own duties by providing health care, formal education, etc.

Bosnia is another example where NGOs ran the country. For four years during the war, they were the government and the only service providers. NGOs in Bosnia did not face any restrictions in bringing into the country whatever was needed simply because the government was far too concerned with defending the country. When the war ended, however, the government wanted to take all its roles back, approve what the NGOs were doing and ensure that they would work through them. The conflict as to who is to do what has not yet been resolved.

Also during the genocide in Rwanda NGOs practically ran the country for at least two years. The Rwandan example shows that if a state is weak, especially in times of war, the government has no time to worry about socioeconomic, educational and related issues, and leaves much room for NGOs to fill the gap. Once the crisis is over, however, it often dislikes the situation created and makes every attempt to force the NGOs to work within its own agenda. In the Rwandan case, the government argued that it had a certain vision and plan for the country’s future, which it intended to accomplish, and not all NGOs were not working towards this goal. Thus, the government ordered the NGOs to coordinate their missions and visions with that of the government, which resulted in a filtering process, as many NGOs were ousted or closed because they were not working along the lines set by the government.

The key questions pertaining to strategic planning are: Why does an organization exist? What is it doing? Why does it do it? And who is it addressing?

According to John Bryson, who is considered to be one of the main experts in the field, strategic planning is a disciplined effort to produce fundamental decisions and actions that shape and guide what an organization is, what it does, and why it does it. To deliver the best results, strategic planning requires broad yet effective information gathering, development and exploration of strategic alternatives, and an emphasis on future implications of present decisions. Strategic planning can help facilitate communication and participation, accommodate divergent interests and values, foster wise and reasonable analytical decision-making and promote successful implementation.

Others, like Emily Gantz McKay, summarize strategic planning as a process of determining what an organization intends to accomplish and how its resources must be directed towards accomplishing these goals in a defined period. In doing so, some fundamental tasks need to be completed, including defining a vision, a mission, and goals, and identifying the stakeholders, the clients, and other people whose needs are addressed. Furthermore, an organization’s role in the community must be clearly defined (e.g., is it the only one in the community or one of many?) as must the kinds of programs, services and products the organization offers to clients, and the resources needed (e.g., people, expertise, money etc.). Then the task is to decide how the resources and programs can be best combined in order to accomplish the mission.

Strategic planning can be applied to many different types of institutions: governments, agencies, cities, non-profit organizations, communities, networks, etc. The size of the organization in question, the stability of its environment, and its overall goal determine the period of time the plan will cover. Governments naturally resort to longer-term strategic planning (up to ten years), while NGOs tend to have two to three-year plans.

While working on a strategic plan, one must bear in mind that strategic planning is not the same as operational planning, which is the step that follows, i.e., the practical work plan for how to accomplish the strategic plan in the coming period. Strategic planning revolves around the vision of an organization, while operational planning refers to implementation, i.e., how the organization gets to where it wants to be.

It is important to stress that strategic planning is not a substitute for leadership. Whether the leadership consists of one person, a committee, or a board of directors, it is crucial to have a plan and direct responsibilities for implementing it. Without leadership, strategic planning will not go beyond a nicely written plan, because no one will be committed to it. If an organization has a visionary leader, he/she should establish the vision and than distribute the responsibilities according to the strategic plan; otherwise, a board of directors or any other body may determine it. How the leadership is eventually set up depends largely on the size of the organization, its work, resources and situation.

Although it is a widespread phenomenon especially among NGOs, it is not advisable to have only one leader, because if everything depends upon this person, the institutions will collapse once the leader leaves. I experienced this in my own organization: during the first two years I had to solve every problem that occurred. Whenever I traveled the phone bill went up drastically, because I was called wherever I was to make decisions regarding even the simplest problem. This example shows that it is important to have a coherent body and a team of people with clearly defined responsibilities, who can handle the situation even in the absence of the leader. Furthermore, the staff should be involved at every level possible and enjoy certain independence - this will encourage their commitment, loyalty and creativity. Without clear organizational structures and a committed staff, strategic planning is meaningless. Strategic planning also enhances the staff’s responses and improves its performance.

John M. Bryson emphasizes that strategic planning is not a substitute for strategic thinking and action but promotes it. Strategic thinking requires a serious commitment to analyzing a given situation, making an environmental assessment, and coming up with a list of requirements. Strategic action is how to implement this plan in the most efficient and productive way. Together these lead to a systematic information gathering about the organization’s internal and external environment. The benefits of strategic planning can be summarized as follows:

Information: Strategic planning provides an environmental assessment that is very crucial for clarifying the organization’s future direction and establishing priorities for action. Strategic planning allows an organization to reflect on known facts and define this knowledge in a new context. It is a gradual learning process that will add up to a larger picture and build a ‘road map’ for the organization that recognizes the impact of the changing environment and helps deal with changing circumstances.

Direction and Focus: Strategic planning also helps develop a rational basis for decision-making by guiding key decision-makers regarding what needs to be done. An organization might have many problems, and employees often get caught up in minor conflicts and do not invest their time in an effective way. Through strategic planning an organization will identify the important problems and clearly formulate its intentions, on the basis of which a coherent basis for solving conflicts can be developed.

Performance: Strategic planning and goal setting can positively influence the organization’s performance as it fosters teamwork and communication both inside and outside the organization. A better performance, in turn, helps convince funders, clients, beneficiaries and staff that the organization or its project are worthy of their attention and services; if an organization is focussed and well-organized, the task of marketing what it is doing or providing will be much easier. Funders and stakeholders like to see a strategic plan that shows that an organization knows what it is doing, why, and where this is intended to lead.

Awareness: Furthermore, strategic planning helps an organization to become aware of its strengths and weaknesses, capacity for growth, other opportunities and potential threats. Thus it provides a focus where no or little attention is usually paid due to the preoccupation with day-to-day activities. An organization might have many conflicting demands and there is a need to set priorities by identifying the services it should focus on. For example, the first program Women for Women organized was sponsorship, whereby women in America sent their ‘sister’ – a female refugee in either Bosnia or Rwanda – a monthly $25 loan and a letter. Once Bosnia and Rwanda were no longer front-page news, the sponsors dropped, and the organization recognized a need to diversify its services. However, we found that sponsorship was what we were best at, inasmuch as it was this activity for which we were most widely known, and we began to increase our efforts to attract sponsors. The need to focus is also evident in organizations that expect or face limitations in their budget, including governments, which requires a reassessment as to how to re-divert the available money in the most beneficial manner. Similar situations arise if the leader is leaving, or if a new competitor comes to the region, or if there is a change in the environment or in the client’s needs.

Staff Involvement: Strategic planning also promotes teamwork, learning and commitment. The staff works towards accomplishing the vision but it is wrong to assume that they will automatically share the vision or even be familiar with the larger picture. In order to motivate staff, everyone must be involved in the design of the vision and feel part of the decision-making, like part of a ‘family’. Many corporations in America, for example, are giving their staff stocks in the company as an incentive to perform well. There are certain limits, though, since not everyone can be involved in everything - this would only delay decisions and lead to chaos. Input and ideas from staff members, volunteers or beneficiaries can be very encouraging, but also quite dangerous as one can easily lose sight of the overall vision and divert from what is actually wanted. Staff involvement, therefore, requires an organized structure, clear roles and duties, and delegation by an authority, which is ready to listen and give the staff the opportunity to express their views.

Empowering the employees means to have them function more or less independently within their assigned responsibilities and encourage them to make own decisions within the confines of their job description. This also promotes creativity, flexibility and commitment. However, in the end, the final decision-making must lie in the hands of a carefully defined body, otherwise the organization will lose its direction.

One of the preconditions for becoming involved in strategic planning is the existence of a functioning infrastructure; without a ‘good government’ – be it on the national or organizational level - strategic planning is useless. In some countries one often faces the problem that planning starts at the apex, with no system, structure or common vision, and with directors that are not appointed on the basis of their individual merit.

In order for strategic planning to be successful, the following preconditions must be met:

The institution is clearly structured;

It has an accurate picture of the environment, including awareness of limitations;

A body of decision-makers exists; preferably representing a variety of expertise (e.g., backgrounds in fundraising, media, management, planning, accounting);

A committed staff and leadership is in place;

All involved must be convinced of the benefits of strategic planning.

According to John M. Bryson, there are two different methods of strategic planning:

The rationale planning model, based on the assumption that in organizations with shared, fragmented power structures there will be either a consensus on goals, policies, programs and steps necessary to achieve the aims, or someone with enough power and authority so that consensus does not matter. The weakness of this model is that it does not matter if people agree or not.

The political decision-making model, which starts with identifying and defining complex issues and conflicts (goals, means, timing, political implications, etc.). Then, policies and programs are developed in order to address these conflicts and choose the most essential issues. Finally, goals are defined accordingly.

Most practical is a mixture of both approaches: identifying problems, then filtering and processing them into a set of goals, putting these goals in the context of the overall situation and finding ways to accomplish them.

Organizations that operate in an unstable environment should limit their strategic planning horizon to a maximum of two to three years in order to maintain certain flexibility. The planning process should try to predict the problems that might occur and provide for alternatives. For example, when the war ended in Bosnia, Women for Women had just finished a strategic plan that addressed war-related issues. The environment then changed drastically and had to be reassessed and reanalyzed. However, since the ultimate goal was the empowerment of women, the vision was also applicable to the post-war situation, only the programs to accomplish it had to be revised and amended. A real problem arises when an organization has to change its goal and not only its projects and the means to achieving its aspirations. Changing a goal means changing the whole organization.

Strategic thinking is evaluating the production, purpose and function of an organization. The underlying idea is to identify the end goal that justifies the organization’s existence. Strategic thinking involves assessing and understanding the needs and environment of an organization, including opponents, allies, competitors, government policies etc., and reaching creative plans that deal with the issues in question. Strategic thinking also involves creativity in developing effective responses to anyone in the external environment – both in terms of providing the suitable services and meeting the needs of the clients.

Strategic management addresses the implementation of a plan. It formulates a future mission in light of all the outside and inside forces that affect the organization, and develops a competitive, sellable strategy accordingly. Strategic management involves creating an organizational structure that utilizes its limited resources efficiently. The entire strategic planning process is about focusing and, thus, requires one to always remember and keep in sight the overall vision.

Strategic management involves one of two approaches:

Operational driven approach: A self-assessment of the environment followed by the formulation of a strategic plan. This makes an organization challenge itself and involves day-to-day/month-to-month activities, i.e., constant updating and dealing with changes according to the vision.

Traditional approach: Following established lines, based on the assessment that the organization is functioning well and there is no need to deal with or change anything. This can only work in a stable environment.