A couple of years ago I had lunch with the leader of a charity who described how his organisation had previously been spending almost a million pounds a year providing training and information events. They’d been unable to get funding and were reluctant to charge a fee, believing it might reduce attendance and limit their impact.
But they’d also been acutely aware that, unless they could find a way to offset at least some of their costs, they couldn’t expand their coverage and reach any further. He told me their target had been to try and find ways to reduce or get sponsorship, for 50% of the costs, while keeping delivery free, hoping it would enable them to double their reach. A goal that, as it turned out, was not far off what they achieved.
But what had also became apparent during the research, and the reason for our conversation it transpired, was that they’d found other charities who seemed able to charge for their training and events, apparently unconcerned about putting off attendees. Indeed, one charity seemed to have flipped, just two years before, from “for free” to “for a fee”.
I suggested that perhaps their hypothesis had been that registrations would go down, but so would last-minute drop-outs and no-shows, so attendances perhaps wouldn’t drop a great deal. Plus, it’s often the case, that those who’ve invested financially, can be more committed to implementing what they learned. I’m not sure this helped alleviate my fellow diner’s concerns, if anything it reinforced his worry that, although they’d hit their target, they’d missed the bigger opportunity.
The problem with setting targets is that you achieve them, when perhaps you could have achieved far more. His charity “just about” got to the 50% cost recovery, only to realise that others were making a comfortable profit. Rather than “shooting for the stars and hitting the moon”, they had aimed for the highest floor of the skyscraper that they could see from the ground. And just about made it up all the stairs.
They didn’t start with a big strategic ambition, they began with a pragmatic tactical plan. That’s why they missed the bigger opportunity and under-shot their potential. It wasn’t a failure of execution, it was a failure of imagination; a failure of ambition and strategic thinking.
There’s a qualitative difference between strategy and planning, one that can open up a world of opportunities when it’s properly understood.
Planning is incremental. It starts from where you are, with what you have, doing what you do, and works out how much further you can get. Strategy is an entirely different discipline. It starts with a bold ambition, a vision of the future you want, and works out what your organisation will need to become to succeed.
Defining a genuinely strategic ambition demands letting go of the constraints of today, the limiting assumptions about what people will accept, the capability the organisation has, and what it can and can’t do. Instead, it means asking, “what would need to be true…” to solve this social problem with a commercial model; to double traded income over the next two years; to become completely independent of grant funding – whatever that bold ambition happens to be.
So here’s my question for you. How big is your vision? How bold and ambitious are your strategic targets? And where are you in the gravest danger of achieving them?