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					A E RIPPON                        A strategic approach for not-for-profit organisations
October 2002




  A STRATEGIC APPROACH FOR NOT-FOR-PROFIT
               ORGANISATIONS




                                 PART THREE




               MANAGING STRATEGIC CHANGE




                                  CHAPTER 5:




   STRATEGY IMPLEMENTATION FOR NOT-FOR-PROFIT
                 ORGANISATIONS




Chapter 5: Strategy implementation for not-for-profit organisations          5-135
A E RIPPON                          A strategic approach for not-for-profit organisations
October 2002



  A STRATEGIC APPROACH FOR NOT-FOR-PROFIT
                             ORGANISATIONS



                                    CHAPTER 5


   STRATEGY IMPLEMENTATION FOR NOT-FOR-PROFIT
                 ORGANISATIONS

                                                                                  Page

5.1     INTRODUCTION                                                              5-138

5.2     STRATEGY IMPLEMENTATION AND STRATEGIC MANAGEMENT MODEL                     5-139

5.3     BUSINESS PLANS AND NOT-FOR-PROFIT ORGANISATIONS                           5-144

5.4     ACTIONS ARE NEEDED TO IMPLEMENT THESE PLANS                               5-148

5.5     ACTION STEPS FOR THE FORMULATION OF BUSINESS PLANS                        5-151
5.6     NOT-FOR-PROFIT ORGANISATIONS STRATEGIC PLANS                              5-157
5.6.1   Strategic audits                                                          5-159
5.6.2   Motivating people to execute the strategic plans to be carried out        5-159
5.6.3   Building a strategy–supportive organisational culture                     5-161
5.6.4   Creating a fit between strategy and culture                               5-161
5.6.5   Creating a results orientation and a spirit of high performance           5-165
5.6.6   Linking rewards to performance                                            5-166

5.7     IMPLEMENTING THESE PLANS FOR NOT-FOR-PROFIT ORGANISATIONS 5-166

5.8     CLOSURE                                                                   5-168




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October 2002

   STRATEGY IMPLEMENTATION FOR NOT-FOR-PROFIT
                 ORGANISATIONS
SYNOPSIS

Implementation of strategies within the fast changing environment of a non-profit
organisation will be determined by the attitude of the management in promptly
making the best of opportunities and timeously taking action. The review and revision
of business plans is ongoing.


Traditionally business plans did not form part of the strategic implementation process,
and many of the problems experienced by organisations in general could relate to this
fact. This was even more relevant in the case of non-profit organisations, which
seldom,   if   ever,   practised   Strategic   Management    principles   and   processes.
Furthermore a reason for this may have been because of the voluntary nature of the
management of these organisations, in that they never translated strategies selected
into results orientated action plans.     Thus a “debate club” syndrome of meetings
rather than actions often evolved. This is still evident in community environments
today.


In many cases, after organisations go through the process of strategic planning in
arranged sessions, often held away in the outdoors, many strategic decision-makers
and managers enter their daily business as usual routines without providing for
efficient implementation of the formulated strategies decided upon at these sessions.
This is especially the case when non-profit organisations’ strategists only meet once
monthly. It is important to follow through to implementation.


This chapter on implementation provides strategy implementation for non-profit
organisations. This includes a brief look at where implementation fits into a Strategic
Management model, who in non-profit organisations implements and carries out
strategic plans, what must be done to implement strategies and how they must go
about implementing these strategic plans. Business plans as a component of the
Strategic Management process and action steps for the formulation of business plans
are also explored.

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A E RIPPON                         A strategic approach for not-for-profit organisations
October 2002



  A STRATEGIC APPROACH FOR NOT-FOR-PROFIT
                             ORGANISATIONS



                                   CHAPTER 5


   STRATEGY IMPLEMENTATION FOR NOT-FOR-PROFIT
                              ORGANISATIONS


5.1   INTRODUCTION


Strategy implementation is not a single event, but is a continuous process of
managing organisational change (Weeks & Lessing 1993: 85). When managing
strategic change of non-profit organisations the key is to transform and translate
abstract visions, missions and objectives into concrete goals, action plans and results.


These plans are formulated around action plans incorporating projects, budgets and
programmes and are often formulated as business plans. Strategy is implemented by
the management of non-profit organisations through efficient planning, organising,
staffing and control.    Often the non-profit organisational structure, culture and
resources limit the implementation of strategy. Planning needs to be bridged with
efficient practices to result in successful performance. In the case of non-profit
organisations, the proper use of motivational tools and incentives is necessary. This is
to motivate, not only management, but also daily operational staff, who are often
solely responsible for the running of such organisations, while voluntary boards or
executive committees work in their primary working environments and only attend
monthly meetings on behalf of the non-profit organisation.




Chapter 5: Strategy implementation for not-for-profit organisations           5-138
A E RIPPON                         A strategic approach for not-for-profit organisations
October 2002

Implementation of strategies within a fast changing environment of a non-profit
organisation will be determined by the attitude of the management in promptly
making the best of opportunities and taking timeously action. Review and revision of
business plans is ongoing. Traditionally business plans did not form part of the
strategic implementation process, and many of the problems experienced by
organisations in general related to this fact. This was even more relevant in the case
of non-profit organisations, which seldom, if ever, practised Strategic Management
principles and processes. It could also have been because of the voluntary nature of
the management of these organisations that they never translated strategies selected
into results orientated action plans.           debate club” syndrome of meetings
                                         Thus a “
rather than actions often evolved. This is still evident in community environments
today.


This chapter on implementation provides for strategy implementation for non-profit
organisations. This includes a brief look at where implementation fits into a Strategic
Management model, who in non-profit organisation implements and carries out
strategic plans, what must be done to implement strategies and how to go about
implementing these strategic plans. Furthermore, business plans as a component of
the Strategic Management process, action steps for the formulation of these business
plans is discussed.


5.2      STRATEGY IMPLEMENTATION AND STRATEGIC MANAGEMENT MODEL


The Strategic Management model highlights the strategy implementation process and
elements that make up the process. This incorporates the formulation of business
plans that provide for detailed planning of action plans concerning projects, identified
budgets and forecasts and procedures to be followed. The question of what needs to
be done, who should do it and with whom, how it is to be done, when it needs to be
done by and where will it be done needs to be addressed.




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A E RIPPON                         A strategic approach for not-for-profit organisations
October 2002

The actions need to be spelled out in detail and communicated to all relevant role
players, stakeholders, interest groups and interested parties as well as those people
responsible for performing these actions. This is to determine timeously performance
results, which can be measured for levels of achieving the set goals.


Figure 5-1: Strategic Management Model




Source:       Wheelen & Hunger 1999: 37


Figure 5-1 highlights the strategic implementation process (standard for all
organisations), which is also applicable to non-profit organisations.


The following constraints highlight some factors pertaining to that of non-profit
organisations, which affect strategy implementation.




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October 2002

•   Service in a non-profit organisation is often intangible and hard to measure. The
    difficulty is typically compounded by the existence of multiple service objectives
    developed to serve and satisfy multiple sponsors.


•   Clients’ or members’ influence may be weak. Often the non-profit organisation has
    a local monopoly and payments by clients or members may be a small portion of
    the revenue or funding generated.


•   Strong employers in professions may undermine the allegiance to the organisation
    employing them.


•   Resource contributors notably fund contributors and governments may intrude
    upon the non-profit organisation’s internal management.


•   Restraints on the use of rewards or incentives and punishments may result from
    the abovementioned points.


It is important to note that Strategic Management processes will be different from
profit-making organisations when considering the implementation of strategy. The
Strategic Management model is still applicable to the Strategic Management processes
relevant to any organisation, profit or non-profit. The five constraints, mentioned
above, affect how a non-profit organisation is organised in both its structure and job
design.   According to Wheelen & Hunger (1999: 300), the following are three
complications that can be highlighted.




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October 2002

o Decentralisation is complicated


A complication, which arises with non-profit organisations, is that the setting of
objectives for intangible hard-to-measure packages of services makes it more difficult
to measure performance and provide for good decision-making. Therefore important
issues of concern to the organisation are usually centralised. Furthermore, top
management (boards or executive committees) often only meet once monthly, which
means lower level managers are often forced to wait until often-critical decisions can
been made. This could lead to delays in taking up opportunities timeously and the loss
thereof, in many cases.


In the case where sponsorships make up a greater percentage of the sources of
revenue for the given organisation, it is important that top management are sensitive
to how the sponsors may view the activities of the organisation. This often leads to
what is termed “defensive decentralisation”, in which top management of non-profit
organisations retain all decision-making authority to avoid any actions which may
offend, or which the sponsors may object to.


o Linking pins of external-internal integration becomes important


A further complication occurs when a heavy dependence on sponsorships is evident,
in non-profit organisations. A special need arises to provide for “buffer” roles, that is
people with relevant expertise and knowledge of both sides (sponsor and non-profit
organisation). These intermediaries should relate to groups, not only inside the
organisation but also to all groups, including sponsors, outside of the organisation.
Often appointing public relations officers, who are chosen specifically to expand on
developing these relationships, performs these functions. This is of utmost importance
when such groups are very diverse in nature. Examples occur where revenue
generated comes from donations, membership fees, and monetary injections by once
off sponsorships annually or government aid and grants.




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October 2002

o Job    enlargement     and   executive     development    may    be    restrained   by
   professionalism.


In non-profit organisations that employ a large number of professional people,
managers must design positions within the organisation that appeal to prevailing
norms. These professional norms, as spelled out in each specific field, may lead to
malpractice in that field if such a job falls outside of the norms of that professional
field. An example is if a non-profit organisation, in appointing its treasurer, does not
take into account professional norms, as spelled out in professional accounting and
auditing practice. For example, if a labour law consultant ignorant of such norms was
appointed as treasurer or marketing specialist, he/she would be restrained by the
professional norms needing to be adhered to for such a position. Furthermore,
appointing a lawyer as operations manager for the overseeing of the daily activities
would undermine certain professional status.


Non-profit organisations tend to deal with these complications differently from profit
making organisations due to the often-voluntary nature of management and
communications, which in many cases are often delayed by meetings being held only
periodically with no constant (day to day) involvement or part-time management.
(Own observation)


A daily operations executive or management committee is often implemented to focus
on decision-making that needs to take place as opportunities or threats arise and
need attending to.


The following figure provides for administrative functions that non-profit organisations
can take cognisance of when decisions need to be taken on strategy implementation,
keeping in mind the intangible nature and constraints on this process.


Figure 5.2 refers to administrative components of strategy implementation needing to
be considered by a no-profit organisation.



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A E RIPPON                         A strategic approach for not-for-profit organisations
October 2002




Figure 5-2: The administrative components of strategy implementation




Source:          Thompson & Strickland 2001: 267


5.3    BUSINESS PLANS AND NOT -FOR-PROFIT ORGANISATIONS


Many non-profit organisations do not follow through with the development of
constructive business planning.     Often the perception created is that what ever
revenues are forthcoming can go out to expenditure on the day to day running of the
organisation, with little effort made in proper businesslike practices and financial
forecasting. It is important to provide for business plans around projects and
programmes envisaged for the organisation. This tool assists with highlighting the
organisation’s intentions in achieving its objectives and planning actions to fulfil
certain goals.




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A E RIPPON                         A strategic approach for not-for-profit organisations
October 2002



The organisation needs to provide for surpluses in a businesslike manner so that
reserves and growth of the organisation can be stimulated. This does not necessarily
mean in financial growth only, but refers to growth in areas of concern that form part
of the main cause for which the organisation is striving. If such organisations do not
translate plans of intent into meaningful action plans, the result is but an organisation,
which is merely a “debate club” rather than a “doer” for solving problems and taking
up meaningful opportunities on behalf of its members or clients. Business plans form
a bridge for translating the future desired state or destination of the organisation
(vision, mission and objectives) into meaningful goals and action plans.


The business unit strategy is often co-ordinated through sub-committees in the case
of non-profit organisations, who need to utilise business plans as a vehicle for moving
the organisation through to a future desired state.         The following figures best
representing this bridging process:


The future desired state of the non-profit organisation is realised by compiling
business plans for each consecutive year, namely from 2001 to 2005. These business
plans are aligned to the organisation’s corporate, business unit and functional
strategies within each unit.


In the case of these non-profit organisations projects and programmes of each sub-
committee around chosen focused areas of concern will need to develop into business
plans.   These plans are excellent tools for presentation to prospective sponsors,
donors and other stakeholders, role players, interest groups and interested parties
when forming partnerships, alliances or mergers with other like organisations or when
piggybacking and inter-organisation linking is proposed.




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A E RIPPON                         A strategic approach for not-for-profit organisations
October 2002



Figure 5-3: Business plans: a frame of reference




Source:       Adapted from Weeks & Lessing 1993: 97


These plans are not formulated or implemented in an isolated state and are directly or
indirectly linked to the future desired state of the organisation. Business plans are a
form of communicating the strategies to be implemented by the organisation annually.


The question of Whom? What? When? Where? and How? are formalised in action
plans. Business plans also spell out all resources required to be able to complete the
project or programme successfully, in spelling out budgets and procedures. These can
be utilised later to evaluate performance results.


Alignment of this process with the non-profit organisation is clearly demonstrated in
the Figure 5.4. All organisational change is strategically directed, thereby ensuring a
commonality of purpose.



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October 2002



Figure 5-4:           Business    plans:     a   component       of    the    Strategic
Management process




Source:       Weeks & Lessing 1993: 98


This process as depicted in the above figure for non-profit organisations is the
responsibility of the management committee or daily management appointed to
oversee that these plans are implemented. If a CEO (chief executive officer) is
appointed, it is his or her responsibility to (with the executive team) ensure that these
action plans are carried out, and to ensure that the organisation has a clear sense of
vision and purpose.


The strategy formulation process ensures that the vision, mission, values, key success
factors and strategic objectives are well defined.



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October 2002



Strategy implementation ensures that these strategic objectives are transformed into
goals and business plans for each project or programme aligned to the future desired
state of the non-profit organisation, and that they are carried out in an efficient
businesslike manner.      Communication of business plans at all levels in the
organisation is important to the actions being correctly carried out, often within the
constraints of the limited resources available to a non-profit organisation.


5.4    ACTIONS NEEDED TO IMPLEMENT THESE PLANS


A final step according to Weeks & Lessing, in the Strategic Management process for
non-profit organisations is to interpret strategic actions, which are incorporated within
each business plan. This results in determining key result areas (KRAs) for defining an
employee’s job and job descriptions for a specific job. These job descriptions, differ
from an organisation’s normal set job description as they are usually set for specific
purposes of developing the action plans required for a business plan. These KRAs are
collated into a key result document (KRD), which, in many organisations, takes the
place of the employee’s job description. Benefits in adopting a KRA approach for the
implementation of action plans are as follows:


•   The clarity of responsibility for the implementation of specific dimensions of the
    business plan is needed


•   Elimination and duplication of managerial effort and grey areas


•   Identification of change agents directing the change process


•   Identification of redundant and overloaded positions creating an opportunity to
    evaluate capabilities of managers and staff at all levels of the non-profit
    organisation




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October 2002

•   Training becomes “needs based” in terms of skills required by staff to implement
    KRAs
•   Alignment of all employee activities to the realisation of the vision and mission
    formulated for the non-profit organisation


•   Nurturing of open discussion and constructive interaction between managers and
    staff


•   Involving of employees as partners in the change process and involving them
    actively in the structuring of their jobs; and


•   Serving as input for implementing a performance appraisal system


Collectively, these benefits constitute nothing less than sound management practice
that needs to be applied to that of non-profit organisations in their endeavours to
construct meaningful business plans. (Adapted for non-profit organisations from
Weeks & Lessing 1993: 97-108)


In the formulating of business plans, the planning team of the non-profit organisation
should always display the organisation’s vision, mission and strategic objectives in a
prominent position. The goals and action plans should be regularly tested to ensure
that they are in line with the desired future state of the organisation. Finally, the
function within which these strategic objectives, goals and action plans are formulated
and implemented must be considered, and their contextual situation regarding the
organisation’s internal and external environments must be observed. The unit must
understand how they fit in with regard to the major strategic issues that need
addressing within the non-profit organisation and furthermore, within the context of
change within the community environment.


Team members need to be creative and focus on the results they wish to achieve and
not only on the process that they need to follow in compiling a business for their unit,
project or programme.


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October 2002

The following factors also need to be considered when compiling a business plan:


•   Financial consequences of each action plan
•   Risks which may affect decision-making
•   Time constraints that must be adher ed to


After all has been considered the best alternatives for the future success of the unit
need to be decided upon, for the project or programme chosen. This often takes the
form of brainstorming sessions by each team. The team may include strategic
partners from non-profit organisations or other profit making organisations through
inter-organisational linking or piggybacking strategies. In is vitally important that,
before presentation of any business plan, it is discussed with potential strategic
partners to be considered for any project or programme. Each potential partner must
first be carefully assessed in terms of having all the necessary resources required to
fulfil the task. The following figure highlights a typical framework for the assessment
of such strategic partners. Figure 5.5 provides for a method of assessment that a non-
profit organisation can consider when selecting the best alternative partnership.


Figure 5-5: Assessing of strategic partnerships to implement joint ventures




Source:       Adapted from Wheelen & Hunger 1999: 279




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5.5    ACTION STEPS FOR THE FORMULATION OF BUSINESS PLANS


The following steps assist with providing for action steps that need to be taken when
compiling or formulating a business plan for non-profit organisations:


•   Ensure that the vision, mission, values, critical success factors and strategic
    objectives are formulated and understood. These should be documented to ensure
    that the plan focuses on the future desired state of the organisation in compilation
    of the business plan.


•   If a CEO is in position, or is to be appointed, ensure that he or she and his or her
    team fully understands and can formulate and execute the above strategic plan.
    Clear set annual goals need to be clearly stated. These strategic directives serve as
    a frame of reference for those involved in compiling the business plan.


•   The sub-committee or business unit managers and their teams translate these
    strategic objectives into unit goals to be achieved in the short term, usually
    annually. These goals form smaller ‘bits’ to be achieved in reaching a strategic
    long-term objective for the non-profit organisation.


•   The team members of each unit or committee now translate the goals formulated
    into action plans. Here all details are incorporated as cost implications, human
    resources required, facilities needed, machinery and equipment and other specific
    resources pertaining to the project or programme or to the unit within the
    organisations ambit. Remember that action plans are results driven, and the
    results to be achieved should be clearly stated giving time constraints and
    schedules.


•   A set of plans in various areas formulated as part of the business plan. Many
    available formats are available to guide the unit in this process. The following
    general set of plans usually needs to include the following aspects:



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o General outline and introduction of the business plan’s objectives and an overview
   of what business project or programme the team has undertaken


o Marketing and public relations plan


o Human resource plan


o Financial plan


o Production plan (if applicable)


o Product or service plan


o Operational plan


The financial plan usually involves financial forecasting and preparing of balance
sheets and income statements for each year’s forecast for at least a three to five year
period. A pro forma financial statement, including projected Profit (surplus in the case
of non-profit organisations) and Loss statements, cash flow projections and a pro
forma balance sheet including a statement of assets and liabilities is required, and
must contain start-up capital inputs and opening balance for cash requirements in the
initial stages of implementing the plan. A business plan needs to be concise and to
the point (no more than twenty pages in total).


It is important to remember that even though profits are not generated, the term
surplus is utilised in the case of non-profit organisations. The same principles apply.
Often the incorrect perception of forecasting a break-even result is forecast (what
comes in can be spent) in the case of the non-profit organisation’s projects and
programmes or for their unit in general. ‘Surpluses’ (profits) generated, are necessary
to build reserves for contingencies and for growing the activities of the organisation,
as deemed fit, as new opportunities arise in the future. The budgets put forward as
part of these plans must make provision for such ‘surpluses’ to be generated.


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The Figures 5-6, 5-7 and 5-8 provide for examples of financial information
requirements needed (standard for all organisations) that are also applicable to non-
profit organisations. Figure 5-6 an example of a pro forma financial statement, figure
5-7 a pro forma balance sheet (this only an example and is not according to the latest
accounting practice) and figure 5-8 an example of a cash flow forecast.


Figure 5-6: Projected profit (surplus) and loss statement




Source:      Adapted from Anderson & Dunkelberg 1990: 114




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Figure 5-7: Balance sheet




Source:      Anderson & Dunkeld 1990: 115


§   The various plans are collated into a concise but informative business plan for the
    unit, project or programme of concern by the unit team; whichever is the case in
    a non-profit organisation. This can be a committee or sub-committee chairperson
    with a team of specialists, managers and some client/members within the
    organisation of concern, who form part of the group. All relevant stakeholders,
    role players, interest groups and interested parties are to partake of the business
    plan in question.




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October 2002

Figure 5-8: Cash flow projections




Source:       Anderson & Dunkeld 1990: 116


•   The various business plans are then integrated into the organisation’s master plan
    by the CEO (if appointed) or by the management team or management committee
    of the prospective non-profit organisation.


•   Executive summaries of the business plans are prepared by each unit management
    team for presentation at corporate level. For non-profit organisations, this could
    be at a special meeting of board members or an executive meeting held monthly
    by a voluntary strategic decision-making or management team operating at a
    corporate level on behalf of the non-profit organisation. Such teams are often
    elected annually at an annual general meeting, where office bearers are in office
    for the period of the coming year.




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It is quite possible that business plans will be sent back to the unit (committee, sub-
committee, project manager or programme leader) concerned for revision, before
being approved by the executive team and finally incorporated into the overall master
plan.


In this discussion the formulation of business plans and key result documents as vital
components of the strategic implementation process was highlighted. The next section
focuses on who carries out non-profit organisations’ strategic plans.      Before this
discussion a specific look at what can be done to motivate people to execute strategy
and eventually achieve desired results would be undertaken. In the case of non-profit
organisations (due to often the voluntary nature of management performed at a top
management level) this becomes a very important reality for many community non-
profit organisations that end up as merely “debate clubs” rather than “doers”.


Further discussion on what can be done to create a fit between strategy and culture
with respect to implementation, creating a results orientation and a spirit of high
performance, the importance thereof and linking of rewards to performance will also
be undertaken. Many non-profit organisations, which traditionally operated loosely
and relied on grants or government subsidisation in the past, will need to change their
thinking around ideas concerning the above, and search for other means for
generating revenue.     By positively motivating voluntary managers and decision-
makers of a non-profit organisation, brainstorming ideas will lead to new avenues.
The following figure indicates potential outcomes if managers are not successful in
applying Strategic Management methodology and orientating the organisation to
accommodate for changes in their environment. This could result in the following
ultimatums.


Figure 5.9 provides for scenarios of potential growth or decline of a non-profit
organisation.




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Figure 5-9: Organisational growth or decline: a management paradox




Source:      Weeks & Lessing 1993: 150


5.6   NOT-FOR-PROFIT ORGANISATIONS STRATEGIC PLANS


Depending on how the organisation is structured, those who implement the strategy
might be different from those who formulated the strategy. In an example using non-
profit organisations, the executive committee may have formulated the strategies but
the daily operational management team may be the implementers of the
organisation’s business unit or project and programme strategies.




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For non-profit organisation decision-makers and managers of business units it is firstly
important to view the organisation as an entity composed of interrelated units and
systems. It is important that managers develop their conceptual skills. This is vital to
successful performance in their community environments as they continually analyse
their environments for opportunities and threats. Skills need to be developed that
manifest in performance.


Effective administration rests on three basic skills as follows:


•   Technical skills pertain to what is done and to working with things. They comprise
    one’s ability to use technology to perform an organisational task.


•   Human skills pertain to how something is done and to working with people. They
    comprise one’s ability to work with people and achieve goals.


•   Conceptual skills pertain to why something is done and to see the organisation as
    a whole. They comprise one’s ability to understand the complexities of the
    organisation as it affects and is affected by its environment.


The optimal mix of these three skills varies at different levels within an organisation.


At lower levels the major need is for human and technical skills. At higher levels the
administrator’s effectiveness depends largely on human and conceptual skills. At the
top of an organisation, conceptual skills become the most important of all for
successful administration of organisation tasks or planned actions to be undertaken.


In non-profit organisations, when deciding on who needs to carry out strategic plans,
it is important to take note of which managers, at what level, need to carry out what
plans or part of the plan.




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5.6.1 Strategic audits


Before any successful new strategic plans are carried out it is important that the team
members selectively audit the organisation’s present situation, and also in terms of
changes that have occurred within the environment. An audit is a checklist of
questions by area or issue enabling systematic analysis of the organisations, units or
project and programme activities presently under implementation. An audit is
completed before carrying out a new strategic plan of activities. This tool is extremely
useful as a diagnostic tool to pinpoint problem areas and to highlight strengths and
weaknesses within the non-profit organisation. The strategic decision-making process
(discussed in previous chapters) provides for eight steps, which, in effect, develops
decision-making into providing for a type of management, audit that concentrates on
the organisation’s strategic situation-the strategic audit.


Non-profit organisations strategic decision-makers and managers, in all strategic
business units, need to audit the present strategic situation of the organisation before
implementing or carrying out any strategic plans for the future desired state of the
organisation.


5.6.2 Motivating people to execute the strategic plans to be carried out


Especially within non-profit organisations and within the organisations sub-units,
individuals need to be committed to implementing strategic plans to be carried out.


Solidifying the organisation’s wide commitment to putting the strategic plan in place
needs doing, and this can only be achieved by good motivation, incentives and the
reward of good performance. This specifically pertains to people of non-profit
organisations who are often motivated to join such organisations because they have a
passion for the cause around the issues of concern. This is especially the case with
those who are elected to voluntary management teams annually to guide the
organisation.



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For non-profit organisations, there are a range of options to get people and
organisational   sub-units to push hard for creative and successful strategy
implementation. Such mechanisms include the following:


•   Salary raises and bonuses


•   Fringe benefits and promotions (or fear of demotions)


•   Assurance of not being sidelined and ignored


•   Praise, recognition and constructive criticism


•   More or less responsibility, increased or decreased job control


•   Decision-making autonomy


•   The promise of attractive location assignments, projects and programmes; and


•   The bonds of group or peer acceptance


The skill is to inspire all decision-makers, managers and employees of the non-profit
organisation to do their best to make a difference within a society and to be winners.
Not-for-profit does not necessarily mean not-for-gain.


Giving them a sense of ownership in the strategy and inspiring the commitment to
make it work by taking action achieve this.


It is understood that if the use of rewards and punishments by management of non-
profit organisations, who are the strategy implementers, induces too much tension
anxiety and insecurity, the results could be counter-productive.          This intended
motivation could lead to de-motivating circumstances, which could influence
negatively on the strategic plans to be carried out by each strategic team.


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As many such organisations encourage voluntary participation, the use of positive
motivating mechanisms are suggested, rather than the use of highly negative “ruling
with an iron rod” motivational methods.


5.6.3 Building a strategy-supportive organisational culture


Every non-profit organisation has a unique culture. It has its own special history of
how the organisation has been managed, its own set ways of approaching problems
and conducting activities, its own mix of managerial personalities and styles, and its
own established patterns of “how we do things around here”. Furthermore, it has its
own legendary set of war stories and heroes, its own experiences of how changes
have been instituted – in other words its own climate and organisation personality.
The leadership task of orchestrating strategy implementation, or strategic plans to be
carried out, involves moving the completely non-profit organisational culture into
alignment with strategy processes and principles.         Building a strategy-supportive
culture hinges directly on the abilities and actions of the strategy manager with
enthusiasm needed at all levels of the non-profit organisation.


5.6.4 Creating a fit between strategy and culture


It is important to choose a strategy that is compatible with the “sacred” or
unchangeable parts of the prevailing non-profit organisational culture. It is the
strategy implementer’s task, once a strategy is chosen, to bring the organisational
culture into alignment with strategy and keep it there.


Creating non-profit organisational culture, which is fully harmonised with the strategic
plan, offers leadership of such organisations a strong challenge. This is an ongoing
process of determination, perseverance and will power.




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The following steps can be utilised to guide this ongoing process:


Step 1:
Decide which facets of the organisation’s culture are in line with the strategic plan and
which are not.


Step 2:
Develop ways to make the needed changes in culture and to recognise how long it will
take to renew the culture once culture-changing actions are initiated.


Step 3:
Use available opportunities to make incremental changes that improve the alignment
of culture with strategic plans.


Step 4:
Insist that managers at all levels within the non-profit organisation take creative
actions of their own, to set an example and to do things that will further install
organisational values and reinforce the culture or changes envisaged within the
existing culture. This encourages managers to take “ownership” of the strategic plan.


Step 5:
Proactively build and nurture the emotional commitment that managers and
employees have to the strategy to produce a temperamental fit between culture and
the overall strategic plan.


Attitude change within the organisation needs to be installed and here the
management of non-profit organisations play’s a key role in inducing such change
amongst, not only employees of the organisations, but all role players, stakeholders,
interest groups and interested parties involved and participating in activities of the
organisation.




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For successful implementation of strategic plans within non-profit organisations the
ability to change aspects of long stranding tradition is imperative to organisation in
fast changing and transforming environments, as are presently being experienced in
the new South Africa. Service levels in South Africa in general pose a great problem
for strategic implementers to focus on, as an ingrained service deficiency seems to be
the trend. This hampers the development and performance of results achieved in
satisfying clients or customers. A cultural change in this respect, at all levels, is also
the responsibility of the strategic manager who carries out the strategic plan and
implements the plan. This includes a non-profit organisation’s members and
relationships held with each of their stakeholders. The following figure 5-10 illustrates
a problem solving process that can assist managers in systematically solving problems
in this regard. Figure 5-11 relates such problem-solving techniques to the service level
output required and the process of decision-making in improving such service levels to
prospective clients or members of a non-profit organisation.


Figure 5-10:         Problem solving process




Source:       Weeks & De Beer 1993: 12


This systematic approach to problem solving has proven to be an efficient and
effective way of solving many service-related problems.


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All services and products or benefit packages for non-profit organisations’ members or
clients need to be designed to meet their needs, in consultation with the members or
clients of the organisation. Implementing strategies that do not meet the needs could
result in the problem of loss of their membership or the loss of these clients
altogether. A culture of service excellence needs to be induced by those who
implement and carry out the organisation’s strategies. This is the case at all levels
within the non-profit organisation. The following service improvement process can
assist in developing a culture of service excellence together with strategy
implementation for a non-profit organisation.


Figure 5-11:        Service improvement process




Source:      Weeks & De Beer 1993: 14



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5.6.5 Creating a results orientation and a spirit of high performance


Creating a results orientation and spirit of high performance with high levels of service
excellence is the ultimatum for success of strategic plans implemented by non-profit
organisations.   The goal is to get everybody, at all levels of the non-profit
organisation, to be involved and committed, and to develop champions out of people
who turn in winning performances.        This is achieved by manager ’s utilisation of
rewards and punishments to create the desired results with high standards of service
excellence.


The ability to instil high levels of commitment to the strategic success of non-profit
organisations, and to create an atmosphere where there is constructive pressure to
perform, is one of the most valuable strategy-implementing skills required by those
carrying out the strategic plans of the organisation.


When the non-profit organisation performs consistently at near peak capability, the
outcome is seen not only improved strategic success, but also in the organisational
climate, where the emphasis is on excellence and achievement a spirit of high
performance prevails.


The successful approaches to achieving a high spirit of performance involve an intense
people-orientation, reinforced on every conceivable occasion in every conceivable way
at all levels of building relationships within and outside of the organisation with all
who interface with the organisation. Strategy implementers need to continually
reinforce positively, to keep motivating and creating an atmosphere of success
through the process of carrying out each strategic plan. Measurement criteria for high
levels of performance should be instilled up front within the plan, and communication
of the desired results to be met with all involved in implementing a plan.


Creating a results orientation and a spirit of high performance is a challenge for
strategic implementers of all non-profit organisations operating in South African
environmental communities.


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5.6.6 Linking rewards to performance


If the non-profit organisation’s strategy accomplishment is to be a top-priority activity,
then the reward structure must be linked tightly and explicitly to actual strategic
performance.    Decisions on salary increases, on promotions, praise and recognition
are the strategy implementer’s foremost attention getting, commitment generating
devices for getting things done when carrying out strategic plans, especially in
voluntary related non-profit organisations.


5.7    IMPLEMENTING             THESE         PLANS       FOR       NOT -FOR-PROFIT
       ORGANISATIONS


Management, the discipline, has also had its fair share of evolution. Management is
indispensable and is extremely important for running any organisation, whether
profitable or non-profit, in whatever form it is practised.      The generic nature of
management to plan, organise, lead and control, features throughout the spectrum of
organisations at all levels. The intensity, however, differs, as does the intent of
management from one organisation to another, and in respect of the different types
of non-profit organisations. These differences are also varied at the various levels
within an organisation. The following figure shows how an integration of various
concepts from the management discipline in relation to other managerial processes
interacts. Figure 5.12 highlights some management functions, which can be seen in
context with other processes.


Figure 5-12:         Management functions in relation to other managerial
processes




Source:        Roux 1996: 108


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The managerial functions can clearly be identified and associated within the Strategic
Management process for non-profit organisations. The control function, according to
Roux (1996: 111) has been expanded to have six steps with fourteen steps making up
the control structure.


The following figure 5-13 refers to the management control system as relating to the
management process.


Figure 5-13:         The management control system as related to the
                     management process




Source:       Roux 1996: 111



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With reference to the management functions of non-profit organisations, managers
need to perform these functions to the best of their abilities so that high performance
results may emerge. This is to ultimately achieve the organisation’s future desired
state, and to provide for long-term sustainability of the organisation’s existence by
effectively implementing all strategies, and by continually striving for high levels of
service excellence to meet the needs of the organisation’s members/clients and to
successfully solve all the organisation’s causes of concern.


5.8    CLOSURE


The implementation of strategies within a fast-changing environment of a non-profit
organisation will be determined by the attitude of the management in promptly
making the best of opportunities and taking timeously action.


In many cases, after organisations go through the process of strategic planning in
arranged sessions, too many strategic decision-makers and managers enter their daily
business as usual routines, forgetting to implement the formulated strategies decided
upon at these strategic planning breakaway sessions. In many cases they fail to
follow through to the implementation phase.


Business plans prepared annually are important to the implementation of action plans.
They bridge the intangible future desired state with actions performed to achieve
results. A reviewing and revising of business plans is ongoing. Traditionally business
plans did not form part of the strategic implementation process, and many of the
problems experienced by organisations in general could relate to this fact.


A specific look at what can be done to motivate people to execute strategy and
eventually achieve desired results was discussed. In the case of non-profit
organisations, due to often the voluntary nature of management performed at a top
management level, this becomes a very important reality for many community non-
profit organisations that end up as merely “debate clubs” rather than “doers”.


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This chapter provides for strategy implementation for non-profit organisations.         It
includes a brief look at where implementation fits into a Strategic Management model,
who in non-profit organisation implements and carries out strategic plans, how these
plans are to be carried out, what must be done to implement strategies and when
they must go about implementing these strategic plans.          A detailed discussion of
business plans, incorporated as an important component of the Strategic Management
process and action steps for the formulation of business plans for utilisation by
managers of non-profit organisations, follows. Business plans play an important role
in the implementation of strategy.




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A E RIPPON      A strategic approach for not-for-profit
organisations
October 2002

				
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