Nonprofits are demonstrating extraordinary resilience and flexibility amid a confluence of economic, public health, and humanitarian crises unfolding around the world. Since the start of the COVID-19 pandemic, they’ve been working to provide emergency relief, keep staff and constituents safe, and stabilize their financial health—all while staying on mission under extraordinary stress. Unfortunately, none of these stressors is behind us just yet, and they require nonprofits to respond in the short term while preparing for the long term. That’s where scenario planning comes in.
Scenario planning helps organization leaders navigate uncertainty while providing structure around making key strategic decisions. This article, and the accompanying tool, can support you and your leadership team through a scenario planning process that could help preserve your organization’s ability to pursue its goals for impact. We carefully adapted Bain & Company’s coronavirus scenario planning guidance and strategy in uncertainty methodology, and worked with a number of nonprofit leaders to put this approach into practice.1
First comes some homework. Decision making under uncertainty starts with clarity on guiding principles for your organization. (See “A Compass for the Crisis: Nonprofit Decision Making in the COVID-19 Pandemic.”) The principles reflect your organization’s unique mission, values, and circumstances, and articulate how you will approach tough tradeoffs balancing your mission, finances, staff, equity, and other considerations. They’ll also help you communicate the rationale behind tough decisions to key stakeholders.
If you haven’t already aligned on guiding principles in your initial crisis response, you’ll want do to so before embarking on the four-step scenario planning process outlined below.
- Identify key drivers at risk
- Develop and model scenarios
- Create a portfolio of actions
- Determine key trigger points
Scenario planning—at a time where so much remains unknown—is both challenging and necessary for nonprofits, as they navigate these unprecedented circumstances and work to preserve their ability to deliver impact. Taken together, these four steps provide a way to think about the different scenarios you might need to adapt to in the coming months and how to think through the difficult choices you may need to make.
A scenario plan can provide a powerful structure for coping with risk and uncertainty, but it is not the kind of structure that ought to be set in stone. Rather, the best scenario plan is a living document—continually revised as new information flows in. If your best assumptions turn out to be wrong, make new ones and course correct. In this fast-changing environment, planning needs to be iterative—taking into account important new information as it becomes available. After all, you are not trying to predict the future, you are preparing a response for whatever future arrives so that you can focus on pursuing your mission.
Read the full article about nonprofit scenario planning by Lindsey Waldron, Robert Searle, and Alexandra Jaskula-Ranga at The Bridgespan Group.