The Role of Nonprofit Boards in Strategic Planning

It’s not uncommon for strategic planning to be treated primarily as a staff exercise, with the board brought in to react to or approve a finished plan. This approach can overlook the important role of nonprofit boards in strategic planning as a core expression of governance. Let’s explore why strategic planning is a shared responsibility of the board and CEO, how board members can be involved throughout the process, and what added value they bring to the planning effort.

What Strategic Planning Is and Is Not

Strategic decisions are fully informed, big picture (often multi-year) and results-focused. 

Business management experts, including Jim Collins, author of “Good to Great and the Social Sectors,” view strategic planning as a mechanism for stimulating disciplined thought. Similarly, Peter Drucker, the consummate nonprofit management guru, said that “strategic planning is the continuous process of making present entrepreneurial decisions systematically and with the greatest knowledge of their futurity.”

Strategic planning is not the same as management or operational planning, nor is it about day-to-day decision-making. Strategic planning does not give the board or its members license to oversee and direct the daily activities of the nonprofit. Those responsibilities are the purview of the CEO or executive director.

One possible exception is when a nonprofit operates entirely with volunteers, without any paid staff. In that case, board members must recognize which “hat” they are wearing. When they engage in strategic planning, they are governing. When they are doing the daily work, , they are not acting in their governing role. The distinction is not always easy in practice, but it can be helpful.

For boards reluctant to begin strategic planning during what many nonprofits consider a crisis, others are less daunted and are moving ahead. In the current environment, strategic issues that may rise to the top include board member recruitment and training; diversity, equity and inclusion (DEI); demand (needs and wants); executive succession planning; HR policies and practices; organizational image; partnerships; program success; and technology.

Why the Role of Nonprofit Boards in Strategic Planning Matters

Including and engaging board members in strategic planning is simply common sense. As the organization’s surrogate owner, the board is responsible for setting long-range direction that reflects both progress toward mission, as well as the current and future environment. This responsibility is central to the board’s fiduciary duty of care.

When a board chooses not to take part in strategic planning, it effectively surrenders its primary responsibility for the nonprofit’s well-being and future. Board members also risk not having the knowledge and understanding they need when exercising oversight of the organization’s programmatic and financial health.

Of course, a nonprofit CEO must play an essential role throughout the strategic planning process. The CEO serves as the primary content and information resource, ensures logistical and scheduling are handled, and often acts as liaison with any planning consultant. The CEO also helps ensure planning decisions are grounded in what is possible and realistic given the organization’s capacity. 

At the same time, while the CEO can influence, they must not lead the process. The board and community “own” the nonprofit. Effective CEOs can take comfort in knowing they have fully informed the board. If they are unsatisfied with the result, they have options.

How and When Board Members Can Be Involved

There are three junctures where the whole board’s involvement in the nonprofit strategic planning process is essential. They include: 

1. Identifying strategic issues and data. 
2. Constructing, reviewing and/or renewing the organization’s theory of change, mission, vision, and values. 
3. Considering and acting on strategic goals and direction based on analysis of the data collected and presented during the process.

Many boards also create a strategic planning task force that includes a few board members and staff. This task force oversees the planning process, vets information, and helps develop and refine language before the plan goes to the full board for consideration and action. Task force members help instill confidence in the process and provide insights as options are weighed and the plan is adopted. 

One of the most tangible ways board involvement adds value is in what members bring to the table. Their knowledge of their respective communities and their core skills and experience all contribute to plans that are more realistic and more likely to be implemented successfully. Additionally, active engagement in planning better equips board members to fulfill their fiduciary duty of care as they oversee implementation and measure results.

Strategic planning is the process that allows a nonprofit to evaluate progress toward its mission and chart its future. Boards have a fiduciary responsibility to take part in this work. Members can serve on a planning task force and participate in full board meetings where key decisions are made. 

The CEO is essential to ensuring the planning process runs smoothly and is grounded in accurate information, and may work with a facilitator or researcher for support. Both board and staff play critical roles in bringing the process to completion and turning directional decisions into a clear roadmap for the nonprofit’s future. When the role of nonprofit boards in strategic planning is taken seriously, the organization is far better positioned to advance its mission in a changing environment.

The preceding content was provided by a contributor unaffiliated with NonProfit PRO. The views expressed within may not directly reflect the thoughts or opinions of the staff of NonProfit PRO.