How do you create strategic alternatives for your nonprofit?

1 What are strategic alternatives?

Strategic alternatives are possible courses of action that your nonprofit can pursue to fulfill its purpose and goals. These alternatives can range from expanding to new geographic areas or populations, to developing new programs or services, partnering with other organizations or stakeholders, diversifying funding sources or revenue streams, improving operational efficiency or quality, and advocating for policy change or social awareness. Each alternative comes with its own scope, scale, risk, feasibility, and impact that must be carefully considered before deciding on a course of action.

2 Why are strategic alternatives important?

Strategic alternatives are essential for creating value and making a difference for your beneficiaries and supporters. Examining each option's strengths, weaknesses, opportunities, and threats can help you compare and contrast the pros and cons. This will enable you to prioritize and select the most suitable option for your nonprofit. Additionally, it provides a way to communicate and align your vision and direction with your board, staff, donors, and partners.

3 How to create strategic alternatives?

To create strategic alternatives for your nonprofit, the TOWS matrix is a useful tool. This framework helps you to generate strategic alternatives based on four scenarios: Strengths-Opportunities (SO), Weaknesses-Opportunities (WO), Strengths-Threats (ST), and Weaknesses-Threats (WT). To use the TOWS matrix, you first need to conduct a SWOT analysis of your nonprofit, which involves assessing internal strengths and weaknesses, and external opportunities and threats. Then, you can fill in the matrix with possible strategic alternatives for each scenario, using questions such as 'How can we build on what we do well and what is working for us?' or 'How can we improve what we do poorly and what is not working for us?'. This will help you to identify ways of leveraging your strengths to take advantage of opportunities, overcoming weaknesses to capitalize on opportunities, using strengths to mitigate threats, and minimizing weaknesses to avoid threats.

4 How to evaluate strategic alternatives?

Once you have generated a list of strategic alternatives for your nonprofit, you need to evaluate them based on their suitability, feasibility, and acceptability. To assess how well each option fits your mission, how realistic and achievable it is, and how acceptable it is to your stakeholders, use the following questions as guides: Is the option aligned with your purpose and goals? Does it address key issues and challenges? Does it create value and impact for beneficiaries and supporters? Do you have the resources and capabilities to implement it? Is there enough time and budget to execute the option? Is there evidence and data to support it? Will the option satisfy the needs of board members, staff, donors, and partners? Will it enhance reputation and credibility? Will it generate sufficient returns and benefits?

5 How to select strategic alternatives?

After evaluating your strategic alternatives, you need to select the best option or combination of options for your nonprofit. You can employ a range of methods to aid in the decision-making process, such as ranking your options from the most to the least preferred, based on criteria and scores. Alternatively, you could involve stakeholders in voting for their favored choice using a simple or weighted system. Additionally, you could explore and debate your options with your stakeholders in an effort to reach a mutual agreement. Lastly, you can test your options on a small scale and measure their results and feedback prior to scaling them up.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?