Navigating A New Year And New Plans

The year we have all endured is now over, and 2021 greets us with its own set of opportunities and uncertainties. If 2020 has taught us anything, it would be that sometimes things change so much that what we planned for the beginning of the year may not turn out exactly as we wanted it to. It shouldn’t discourage us from making plans, however. If anything, it tells us that we should take a different approach in annual planning that will give us more time and resilience whatever comes our way. In this episode, Douglas Nelson shares a story of one of the clients he has worked with at The Discovery Group over the last couple of years. This story resonates with leaders across the social profit sector who are now confronting the challenge of setting goals and deliverables for the new year. Make sure to listen in as this episode sets the tone for the rest of the year!

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Navigating A New Year And New Plans

We are excited about the lineup of guests and conversations we have as a part of season four. Before we get to our guest, I wanted to share a story of one of the clients that we’ve worked with here at The Discovery Group over the last couple of years. As you’ll be able to understand as we go through this story, her name has been changed and we’re trying to be a little vague as to our organization so you might not be able to guess. The story is somewhat universal for leaders across the social profit sector.

After we had a very challenging year in 2020 and as people come back excited, what does 2021 mean? What is it going to mean for our organization? As you’re getting ready, there are some lessons to take from this story that I’m going to share about Jan. I’m going to start in March 2020, as most stories will over the next couple of years, as the reality of the pandemic began to hit her organization and her board in particular. It was clear that not only was the world changing, so was Jan’s role as the CEO within the organization.

The board was becoming much more interested in the day-to-day operations, wanting to ask questions about if not actually jump into the workings of the machinery, but was laser-focused on what was going on. Her team was asking different kinds of questions about how the work was going to continue, what it meant for them personally, their own jobs, their own lives, their programs, and for the people that they serve through their organization.

Donors were asking questions whether they were going to be able to keep their commitments that they’d made. Whether their annual gifts were going to be the same or will they be able to honor their campaign pledges. Through the spring, everyone around her was asking, how was the organization doing? Some even stopped to ask how Jan was doing not just as a CEO, but also as a person. The question that was all on their minds came out in one form or another, what’s going to happen? More specifically, what’s going to happen to our organization?

Unfortunately, Jan had not received a crystal ball in her leader’s toolkit as many of you reading. She was guessing, estimating, and hoping just as we all were. There were questions from the board about, do we have the right team? What does the pandemic mean for our organization? Are we still relevant? Do we need to change our mission as a result of the pandemic? Do we have too many people? What’s the right number of FTEs that we should have on our team as we move through this pandemic? What does this mean for our total revenue? What does it mean for expenses? What happens if we’re not able to make our funding commitments?

In a more frequent daily basis, the staff was asking even harder questions. What does it mean for our mission and what does it mean for the people that we serve? What does it mean in terms of working from home? What does it mean for me personally in my job and my family? Those are the questions people were asking. As we all went through it, we realized there were many more questions, sometimes deep and existential questions that we were not saying out loud and we were wearing on our faces.

Even through a Zoom call, Jan could tell that her team, like almost every other organization and every other team in the sector, was struggling to make sense of how to show up as their best person at work, at home or as their best person in general. I could have said this at the start and you will certainly have this understanding by the end, but Jan is great at her job. At first, she and her management team set out to answer all of the questions that the donors, the board, and the staff were asking.

They were reforecasting revenue assuming that some fairly important, even critical events would be canceled or done virtually, though none of us knew what that meant at the time. They’ve made some difficult decisions around the team and reducing the total FTEs. Some members of the team were furloughed, mostly associated with the events that were not going to be able to happen. The board and the management team went through an extended process of scenario planning.

They came up with policies and understanding agreements for what it meant to work from home. Jan spent a lot of her time notifying staff of the changes, what it meant to set up people in their home offices and how they’re going to work. That’s when we all started living the Zoom life, team check-ins. For many organizations, they were daily, and then went on to weekly and bi-weekly as the pandemic wore on.

I remember at the time speaking to another client, who was late for our scheduled telephone call, but he did call. He was calling from his family minivan. He said the front seat was full of keyboards and monitors. The back was full of office chairs he was delivering to people so that they could do a better job of working at home and to support their efforts working from home. As we all and Jan was going through that, she was helping the team and herself to define what will work look like to deliver on their goals, and what goals need to be changed. What necessary changes need to be made to the annual plan, the quarterly plan, and what we do on a daily basis.

The board was interested in the day-to-day. The board started asking for a reforecasting of revenue every two weeks. A committee was struck to monitor the pandemic and its impact on revenue and on the entire organization. Reforecasting and scenario planning became the new name of the game, re-forecasting every two weeks, scenario plans were updated on a weekly, bi-weekly and monthly basis. If revenue was down by 20%, what does it mean if revenue was down by 40%, 60%, 80%?

At one point, two board members were asking, what if we raise no more money for the rest of the year? What does that mean for the organization? That’s a fairly straightforward scenario to plan for. It’s not particularly helpful in a large social profit organization even in the face of a pandemic. By the middle of June, everyone was exhausted, the board, the team, and Jan. Jan and I sat down and worked out how we were going to breathe some energy back into the organization, and bring some sanity to how they were spending time.

Breathe. You have more time and resilience than you think. You will get through this. Click To Tweet

We worked on a plan that Jan took to her board chair to focus on execution until October and reforecast the year end by Thanksgiving, the Canadian Thanksgiving, the one in early October, and then come back to the board with an idea of where they were going to end the year. Jan’s organization has a March 31st fiscal year end. By the time October came, it was clear that the revenue was not down nearly as much as anticipated. The doomsday scenario of revenue dropping to zero or even dropping by half simply had not materialized.

In areas like major gifts and the specific campaigns that the organization is running, they were ahead of the previous year and in many ways were meeting or exceeding the original plan for fiscal 2020. Total revenue was down with the loss of those significant events, but so were expenses. The board was feeling more confident. The board chair even sent out a note to the board underlining the need to remain vigilant, but ultimately saying, “We’ve got this. We’re in as good a position as we can be, given the factors affecting our organization.”

At this point, the ad hoc committee was dissolved. It was also clear that while the board was feeling more comfortable, the team was not. People had become past the point of exhausted. We were just saying, “We’re tired.” Through all of this and through the fall, I kept hearing from leaders across the country that they were feeling what Jan called cheerleader fatigue. How do we keep our team up, motivated and moving when they’re dealing with many things at home, in the world around us? As politics became more toxic in some parts of North America, how do we keep people focused on the good work that we do here at this organization?

It was a question that Jan and many leaders were asking themselves. In our conversations through October and early November, it became clear that while the board had developed confidence by focusing on what we will do, a mindset of what actions will we take that we can control, and not focusing on what will happen or what will change in our external environment to affect our organization. Jan hadn’t made that mindset transition with her team that was still focused very much on what’s going to happen. The net effect was her team felt they were running a race and forgetting to breathe.

We can all run pretty fast holding our breath, just not for very long. Jan made changes in how she was working with her leadership team. She focused on the issues and concerns within their control and the areas where they could take specific actions, declare success, capture a learning or two on the things that didn’t go quite so well and move forward. The focus was on what we will do and it worked. By the holiday break, everyone was still tired, but everyone was breathing on a regular basis. The organization was starting to come back to its former vibrancy.

We then had a break. Everyone was ready for it. I don’t know how many memes you all saw about how people could say goodbye to 2020, and how 2021 was going to be wonderful. While I am on the optimistic side of the scale, there is a lot to be concerned about and a lot to be paying attention to. I know as leaders in the social profit sector, you’re probably asking yourself whether your optimism is well-founded and how do we get back to where we were, or get back to an even better place with our organizations as we move through the year.

I spent a lot of time talking to leaders across the country. Jan and I spent a lot of time talking about her plans for 2021. I realized an interesting thing was happening, especially when she got to talk about preparing the annual plan for the new fiscal year, a process that usually starts by the middle or end of January. She was describing the challenge of doing a full year plan with all of the uncertainties of the pandemic. I was nodding along and listening to her, “That’s going to be very difficult.”

I realized that because it was planning and particularly annual planning, her thinking had naturally gone back to the “what will happen” mindset. How do we know what revenue is going to look like in March if we don’t know when vaccines are going to be completed? What is that going to mean for the economy? Will our donors continue to stay with us? Will the virtual events that we accomplish work twice? They were new and novel for the first year, will they work in a second year? These are all questions we can’t know.

We decided to divide the plan and all of the activities she was describing into the “what we could do” column and that “what we will do.” We spent a little bit of time debating briefly whether this should be called the “what we must do” category, but we ended up at “what we will do.” This isn’t a list of tasks. This is not the summary of the job descriptions of everyone in the organization. These are the important initiatives that would define the year as we all do and as you all do when you’re looking at planning for your program or for your entire organization.

She took that list of what we could do and what we will do to her management team for refinement and buy-in. What was interesting was the “what we could do” list grew significantly. The “what we will do” list became clear that it needed to become shorter. They work through the list and got it down to seven “we’ll dos” across the organization. Jan will take that to her board chair for discussion in a few days. The consensus from the management team was that they felt invigorated by clear understanding of what they will do rather than lost in the scenario, planning fog, or the idea of reforecasting every couple of weeks, or even every couple of months as they move throughout the year.

One of the important parts of talking about what we will do was building in milestones for measuring, what have we learned about the external environment? How are our donors responding to our messaging? How are our donors able to respond as a result of the economy and the impact of the pandemic? Building in those milestones as places where there will likely be some revisions, whether up or down to both expenditures and anticipated revenue for the organization.

I’m sharing this with you because there are some lessons from Jan’s experience that may be helpful whether you’re the CEO, the head of fundraising, or the head of marketing and communications, or even if you simply aspire to those roles. The first is try to avoid falling into the old pattern of doing annual planning the way you’ve always done it, the way your organization has always approached it. Yes, you need a budget. Yes, you need goals and deliverables, but understanding that these may change as the environment that we’re in necessarily forces those change on our organizations.

Being clear both to your team and to your board, that while these are the goals for the year, they are subject to revision as you reach those milestones. Whether you set those milestones on a bimonthly basis, a quarterly basis or schedule a check-in six months into your next fiscal year. Avoid the patterns of the past. They will not help you as you move forward. The second is to adopt the “what we will do” mindset as much as possible, and be disciplined with yourself to make sure that you’re not falling into the trap of, if we do this, what will happen? That was such a hallmark of many of our thinking when the pandemic first started. Focus on the tangible actions you will take, not on the external factors that will affect your organization, that you can’t anticipate.

The third is ensure your board team and colleagues. Understand what the actions are that you’re going to take and the immediate expectations of those actions. Meaning, we’re going to add staff in a particular area because we are investing in our digital fundraising for the upcoming year. That is what we’re doing. We will not necessarily be able to determine exactly what the return on investment for those new staff will be by April or by September of the next year, but we are going to take these actions because we believe it is the way to position ourselves most effectively. Make sure everyone understands those choices and understands what you are expecting the immediate implications to be, not looking outside the organization and not looking too far down the road.

The fourth is to limit your options. I spent most of 2020 talking to boards about saying no to things that they could do that they certainly could do, but certainly should not do, given all that was up in the air. The world is full of great ideas, innovative strategies and long-planned reviews that you could do. As a leader, as a board member, if there’s a new idea that isn’t nice to have, don’t do it. Don’t put it in the plan. Don’t even mention it as something we might get to if the world goes the way we want it to do. Keep it out of the plan. Focus on executing only the most important strategies and tactics. Do them as best as you can, reassess at your milestones, re-evaluate what you’re going to do next and move forward.

The fifth lesson to take from all of this is remember to breathe. You have more time and resilience than you think. We are moving through a challenging time. After a break and you’ve come back. Many of you feeling optimistic and hopeful about what is to come. I share that optimism. We have time. We have time to look after ourselves. We have time to look after our teams. We have time to say no to those nice to haves in our plan, to say no to those pet projects, whether they come from a member of your team, whether they’re your own pet projects as leader, or whether of course they come from the board. We have time and we have the resilience to get through this.

Through our work at The Discovery Group, we are so grateful to have the opportunity to speak with leaders across the country on a very regular basis about their experiences of the pandemic. As a listener/reader of this show, I’d love to hear more about your experiences of the pandemic, what you’re looking forward to, how you’re making sure to break those patterns of the past and falling into the trap of history. How you’re focusing on the “what you will do” rather than the “what will happen” mindset. It’s a great world out there. Philanthropy is changing. Our donor mindsets are changing, and the organizations that are going to be truly exceptional are going to be changing just as fast as the world around them. I look forward to a great 2021. I hope you’re looking forward to the rest of season four of The Discovery Pod. Thank you for reading.

About Douglas Nelson