2020 brought Covid and, in 2021, we have the new variant and Brexit. But, if we act now, we can mitigate the risks and there will be opportunities too, for those who find and exploit them. This strategy toolkit assesses the 2021 outlook and gives you everything you need to do that. Charity COVID19 Toolkit 1 of 7 (Strategy) was last updated Jan 21. It's part of Charity Excellence Survive & Thrive 2021.
We can't change what's happening in the outside world, but we can respond to mitigate threats and exploit opportunities. This toolkit does the spadework for you.
How effective are charities at strategy? The Charity Sector Data Store strategy indicator has been at amber since 2018, showing that the majority of charities report they are not doing this well. Weaknesses within this include, not assessing funding needs effectively, a lack of realism in target and objective setting, not focussing on delivering impact and not engaging people in the strategy. To find out how to make your strategic planning more effective, complete the CEF Strategy questionnaire. It takes 2 mins to register here and 30 mins to do so; everything is free.
What are the sector's key weaknesses? Of the 21 top level indicators, 3 others are also at amber. Sustainability will come as no surprise, but weak management of fundraising and ineffective planning might. More positively, communications has moved from amber to green, over the course of the year. Covid tracking, begun Mar 20, was initially all red/amber, but now only 2 of the 16 indicators are amber, showing how outstanding well the sector has responded, despite the huge challenges and desperate shortage of resources. However, 2 of the 3 Brexit indicators have been at amber for a long time, and remain so. There is now very little time left to do something about that.
But we are desperately short of funding and our people hard pressed. Survive And Thrive 2021 builds on the Charity Excellence response to the Covid crisis, by providing you with a whole range of new resources and functionality, to help you make this year a great one for your charity.
2020 was a hugely difficult year, but the impact of the new Tier 5 and Brexit, are likely to drive further increased demand and widen the already huge funding gap. But, the impact will continue to be felt unequally across the sector. Use this sector assessment to identify the issues of most importance to you.
The budget will be on 2 March and is likely to include furher measures but, with the focus on employment and the economy, that may well not include anything for charities.
What That Means - charity closures quadrupled after the last recession; 12,000 closed. Potentially, 2021 could bring much worse.
Why That Matters - it's not just a 'charity crisis', it matters to all of us. Some 98% of people have used a charity's services and our work directly impacts on key Government priorities, and;
Funding Us Makes Economic Sense As Well - with a passionate, but not well paid workforce of under 1m and nearly 20m (unpaid) volunteers, we represent extraordinarily good value for money. Unlike the £10.5bn in Covid contracts awarded without competitive tender and the middle-man paid £21m in commission.
But, the Pro Bono Economics Civil Action Report (Nov 20) found that civil society is under valued and overlooked, and 35% of the public think charities are wasteful and 31% that there are too many UK charities. In my view, the sector needs to change from asking for more money, to making the case for why it's needed, based on a clear narrative about the value we add to society.
Global - more widely, the pre-COVID global risks remain, such as the more belligerent stance by China and the growing impact of climate change.
All organisations have lost income, but for commercial ones this is at least partially offset by falling sales creating a reduction in their production costs. However, charities are hit doubly hard, because recession also drives a substantial increase in demand for their free services; their costs go up.
This Charity Excellence Insight Report used the system's data to provide a full breakdown of the above - how much, who it's going to, what the future might look like and lessons learned.
Whatever numbers you choose to use, there is unquestionably a huge funding gap and, potentially, this may become even greater in 2021. However, that's not a counsel of despair, but a call to action.
Here are some ideas to think about.
Boring, But Very Important - finance is often treated as unimportant and getting that wrong in a crisis can be fatal. The COVID Toolbox toolkits will help you make sure you don't.
Here's just one example. We're lobbying for a relaxation on Gift Aid, yet we fail to claim about £600m each year. That's just one of many charitable tax reliefs, you can claim up to 4 years retrospectively, it's core funding and you get it every year in the future. That's £ billions we're already entitled to. Want your share? Run 'Tax Reliefs' in the CEF query system and it'll find yours and link you to what you need to claim it.
Not Boring - but, everybody always wants to talk about fundraising, so here are some things to think about:
Toolkit 2 will enable you to turn that into a fundraising recovery plan.
Access text versions of the toolkits using the links above, or download these in toolkit format, with the additional tools I've created to help you, from within the CEF itself.
No matter how well we mitigate the funding gap risk, we can't close it, but a crisis is a catalyst for new ideas and better ways of doing things. Finding and exploiting these gives us another way forward.
The Past - in recent years, social media went from online chat for young people to fundamentally changing society in ways that no-one ever envisaged. The charity sector was very slow to respond, but those that did were far more able to take advantage of this and much better prepared for the virus. If your Board's now on Zoom, that's good, but that's not innovation, it's catching up.
In 2021 - we need to get ahead of the curve, at both sector and individual charity level, by recognising that we would achieve far more by working in a genuinely collaborative way, by putting aside the (too often) competition with each other. We need to identify and share the emerging opportunities and new ideas, work to develop and roll out scalable models, and funders need to be willing to invest in making this happen. And we need to find a way to engage Government in supporting us to make that happen.
Changing Mindset - let's admit it, collaboration is often superficial. The Sector Data Store collaboration metrics show this to be an area of weakness. That's not my assessment, but what the charities using it are saying. The all too frequent competition hinders the exploitation of new ideas, wastes scant resources and splinters our voice to Government. We need to collaborate to repair the ship, not fight over who gets a seat in the lifeboats. That's about leadership and new thinking, to find a way forward and give our people hope. They need and deserve that.
Some are becoming apparent, but there will be others that we don't yet know about, and some of these could have huge impact in the longer term. Which will matter will vary from charity to individual charity. But they can't do it all themselves - there is a key role for sector bodies and funders in leading our response.
COVID19 is already creating huge changes, some of which will change the way we work in the future.
Some good may come from awful events and factors may coincide, creating greater opportunity.
Both the impact of the virus on the BAME community and the Black Lives Matter campaign became matters of national debate.
Other areas with long standing issues that have now come more to the fore include mental health and social care.
Others may be specific to certain charity sectors or even individual charities.
Unexpected opportunities - Ash have found that a million people have given up smoking since the crisis began.
The 1st Brexit opportunity - Environmental Land Management (ELM), replacing EU farm subsidies, will pay farmers to prevent floods, plant trees and protect wildlife.
Your threats and opportunities will be specific to your charity and could be global, UK, regional, or even very local.
Think about what these might be and what do you need to do now to make 2021 a good year for you. Part 3, gives you a process and tools to do that. Don't do nothing.
There isn’t enough funding and there isn’t going to be. Boards that act strategically to the emerging threats and opportunities, will be far more able to mitigate risk, and find new ways of working to increase their impact and use resources more effectively.
Strategy is about making the best decision you are able to, based on the best evidence you have. It doesn’t have to be complicated, but you do need to have a logical, structured process, challenge positively, be prepared to think about new ways of doing things, take people with you and make decisions based on the available evidence.
We cannot control the events in the outside world, so effective strategy isn’t about deciding what we want to do, but rather understanding how that may impact your work, and focussing our resources to exploit the opportunities and mitigate the threats facing us.
These are the O and T in your SWOT. What the threats and opportunities may be for your organisation, depend on a range of factors specific to you and may appear at global, national, regional or even local level.
You need to be looking outwards to identify, and then assess and respond to these. Think through what the issues above may mean for your charity.
These are the S and W in your SWOT. If you’re a trustee, download the CEF Board Bingo game for your next meeting to find out what yours are.
We’re usually feel able to identify our strengths, but it’s always worth thinking through this.
Write down every strength you can think of, then test each in turn by asking yourself what measurable evidence do we have that demonstrates that to be the case? Identify the key ones.
Even the very best amongst us have weaknesses, but many find identifying these the most difficult aspect of strategy. But, these are usually the best opportunities we have to achieve more.
Sector Weaknesses - The CEF Data Store aggregates all user data anonymously to create Big Data for the sector. The metrics at amber are strategy, fundraising, communications, sustainability and how realistic we are in our planning and target setting. That is the majority of charities do not do these well. Are you one of them?
Challenges - We have fantastic people, but people are often resistant to change and talking about ‘weaknesses’ almost always makes people react defensively. I find that approaching this as looking for opportunities to achieve even more helps.
Bring your Strengths and Weaknesses together with you Opportunities and Threats to create your SWOT analysis. If you wish to, you could identify those that are particularly important or urgent. Then use this to create your strategy. Watch this Charity Excellence ‘How To’ video (3 mins) for how to do your SWOT really well.
This image at the top is an example, which highlights those that are particularly important, or urgent. The arrows show linkages that can be used to create a strategy; using strengths to exploit opportunities, and/or to address weakness, and/or to mitigate/avoid threats. Or better still, could you turn a threat into an opportunity?
However, strategy isn’t a plan, it’s what an organisation does and that involves everybody, ideally from the outset. It’s important to engage people and turn your plan into the timetable, budgets and actions needed for them to deliver it and your progress to be monitored.
Whatever you do, don’t do nothing.
How To Make Strategy Effective. Or Register Now to join the 11k members of our community and assess your strategy in 30 mins, with access to a huge range of resources and people who will help you; everything is free. The system works for any UK based non-profit and requires no skills or expertise to use.