Inaction has a price. Hesitating to put a new strategic plan into motion can have significant hidden costs, impacting the the foundation’s effectiveness and its ability to make timely and meaningful contributions. Despite the best intentions, many funders fall into the trap of believing that strategic plans need a lengthy incubation period before they can be enacted. This misconception can lead to various detrimental outcomes, each carrying its own set of expenses.
Here are some key costs associated with delaying strategy implementation in philanthropy:
1. Inertia and Loss of Momentum
When strategic plans are delayed, the initial enthusiasm and drive to implement new ideas diminish. This inertia stalls progress, making it harder to regain momentum once the team is ready to proceed. The longer the delay, the greater the difficulty in re-energizing stakeholders. Continuous delays can lead to a culture of complacency, where the urgency to act dissipates, causing a ripple effect of reduced productivity and morale. Furthermore, the psychological impact of stalled initiatives can demoralize staff, reducing overall engagement and motivation.
2. Misalignment of Efforts
While waiting to implement a new strategy, your team continues to work on outdated priorities. This misalignment means that resources, time, and energy are spent on tasks that do not contribute to the foundation’s new goals. The cost here is twofold: wasted effort on obsolete tasks and a delayed start on impactful new initiatives. This not only hampers progress towards achieving new objectives but also frustrates staff who are eager to work on relevant and innovative projects.
One foundation leader told me she anticipated it would take their staff an entire year after developing their strategic plan before they could stop doing all their old activities and shift to the actions required to implement their new strategic plan. She justified this by calling it the Strategy Transition Year! You don’t need a year to change gears. You need to stop doing the things that no longer help you achieve your goals and start doing the things that do.
3. Wasted Investments in Planning
Creating a strategic plan often involves significant investments in terms of time and money, including hiring consultants and dedicating staff hours. If strategy implementation in philanthropy is delayed, these investments yield no immediate return. The strategy risks becoming outdated, making the initial expenditure almost futile. The sunk costs of planning become a financial burden without the payoff of strategic advancement.
4. Vulnerability to Changing Conditions
Delaying the implementation of a strategic plan can render it obsolete before it is even put into action. Both internal and external conditions can shift rapidly, such as market dynamics, political landscapes, and organizational capacities. An outdated plan may no longer be relevant, necessitating a costly revision or complete overhaul.
5. Excessive Focus on Presentation
Often, delays in strategy implementation in philanthropy are due to spending months crafting a comprehensive, visually appealing strategic plan document. One of my foundation clients developed their new strategy and then spent five additional months writing, editing, and graphically designing their strategic plan document before the board could officially approve it and staff could begin implementing it. The true value of strategy lies in actionable steps. Spending excessive time on design detracts from the core purpose—implementing the strategy swiftly. Simplifying the plan into a concise two- or three-page Word document can save resources and expedite execution. This approach ensures that the focus remains on strategic priorities and quick wins rather than on producing an elaborate document that might never see the light of day.
6. Opportunity Costs
Every day of delay in implementing a new strategy is a missed opportunity to achieve potential gains. These opportunity costs can be significant, including delayed impact on community projects, missed opportunities to leverage additional funding, and lagging behind more agile organizations. The cumulative effect of these missed opportunities can be substantial, affecting not just the foundation’s immediate goals but also its long-term vision and credibility within the sector.
To mitigate these costs, foundation CEOs and trustees should prioritize rapid, flexible strategic planning and implementation. Streamlining the process and focusing on immediate action can enhance impact and ensure that resources are effectively utilized.
Ready to take the next step in developing a robust succession plan for your foundation or philanthropic family? Join me for my upcoming free event, The Simplified Succession Plan Workshop. This interactive session, exclusively for foundation CEOs, trustees, donors, and family office leaders, will provide you with practical tools and strategies to create a succession plan that works for your unique situation. Don’t leave your legacy to chance – invest in your foundation’s future today!
