Section 1. Developing a Management Plan

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• What is a management plan?

• Why does your organization need a management plan?

• How do you develop a management plan?

• How do you evaluate and adjust a management plan?

Whether your organization is a one-person volunteer operation or a multi-program giant with dozens of staff, it needs a management plan to make sure that it operates smoothly and gets everything done. The plan for a tiny organization can obviously be a lot simpler than that for a huge one, but the intent in both cases is still the same: to carry out the mission of the organization and the day-to-day tasks needed to support that mission and keep the organization running as effectively as possible.

What is a management plan?

A management plan is a blueprint for the way your organization is run, both day-to-day and over the long term. It includes the standard methods for doing various things -- handling money, dealing with the actual work of the organization, addressing the way people in the organization do their jobs -- and the overall philosophical and intellectual framework in which these methods operate.

The management plan for your particular organization depends on a number of factors:

• What is the organization trying to accomplish? A neighborhood initiative that exists to achieve a single goal -- keep a historic building from being torn down, preserve a piece of open space, build a playground -- has very different management needs than, say, a health clinic that plans to serve the community for years. Issues that are both important and ongoing for the clinic (staff pay and benefits, for instance) may simply not exist for the other organization.
• What actually needs to get done day-to-day to keep the organization running? The actual tasks that keep the organization alive, maintain its standing with funders and the community, and allow it to accomplish its goals, need to be carried out efficiently and on time. Who's responsible for that, how many people will it take, and what are the mechanisms that will allow it to happen for your particular organization?
• What degree of freedom do people at all levels of the organization need in order to do their jobs well? If nothing can get done without going through several layers of management, the organization isn't going to be very effective.
• What are the resources available for carrying out a management plan? How many administrators could the organization support, given its finances? If the answer is one (or one part-time), your management plan will look very different than it would if the answer were three.
• How does the management plan fit in with the mission and philosophy of the organization? It's important, both for the internal workings of the organization and for the way it's viewed in the community, that there be consistency between what the organization says about itself and the way it runs. If an organization claims to be democratic, but keeps its staff totally powerless, it is not only violating its own principles -- and thereby making it less likely it will accomplish its goals -- but also compromising its reputation.

Why does your organization need a management plan?

Granted, a lot of work goes into keeping an organization going. Why can't it just get taken care of as it comes up? Why go to the trouble of creating an actual plan for just doing what needs to be done?

Except for the last, the points below all apply to organizations with a number of staff members. But even a one-person organization needs some management planning. When do bills get paid? How do you relate to other organizations and entities? Will you have a bank account? These are all management issues. If you are a really small organization, you may not need a formal plan, but it's still important to do some planning.

The general answer here is that your organization is too important for you to leave things to chance. If there's no plan, everyday tasks may fall through the cracks, emergencies may arise with which no one knows how to cope, responsibilities may not be clear, and--the bottom line--the work of the organization may not be done well or at all. A good management plan helps you accomplish your goals in a number of ways:

• It clarifies the roles and responsibilities of everyone in the organization so that everyone knows what she and everyone else is supposed to do. Staff members know who they need to go to for information, consultation, supervision, etc. They also know what the boundaries of their own positions are -- when they can do something without checking with someone else, and when they can't.
• It divides the work of the organization in reasonable and equitable ways, so that everyone's job is not only defined, but feasible.
• It increases accountability, both internally (when something doesn't get done, it's obvious whose responsibility it was) and externally (the better the management of the organization, the better it will serve the community).
• It ensures that necessary tasks are assigned to the appropriate staff members, and creates a time schedule to get them accomplished. Bills get paid on time, staff members are where they're supposed to be to provide the organization's services, funding proposals get written and submitted, problems are dealt with, and the organization functions smoothly as a result.
• It helps the organization define itself. By developing a plan that's consistent with its mission and philosophy, an organization can be clear on what it believes in and communicate this with clarity to its staff, its target population, and the community as a whole.

This is the second reference in this section to consistency between the organization's philosophy and its management plan, and it won't be the last. This issue has been the downfall of many an organization. Some organizations that are inconsistent on this matter simply fall apart amidst wrangling among staff, director, and board. Many more change to become exactly what they initially hoped never to be: dictatorial, or more concerned with income than with the services or support they provide to their target populations and the community.

For an organization, as for an individual, living your principles is not a small matter. It is what defines you as either a respected and admired member of the community, or as a hypocrite who isn't worthy of attention. You simply cannot give too much thought to how your management structure mirrors the principles of your organization: it could be a matter of life and death for the organization.

How do you develop a management plan?

In this part of the section, we'll go step by step through the formation of a management plan.

Decide on a management model (or determine what you already have)

The management philosophy of your organization defines how you view management and how you want your organization to function. What will work best for, and best reflect the character of, your organization? If the organization is very small -- one or two people -- this may simply not be an issue. But if it's larger, what do you need and want? Is it important that the organization be extremely efficient, and that decisions can be made at the drop of a hat? Is it important that the organization be open, and that staff and others feel valued? You need to think carefully about what kind of model will get you what you want, and not get you what you don't want.

Some common management models are:

• Classic hierarchy: Authority is top-down, typically from the director or board chair. As in the military -- a textbook example of a hierarchy -- there is a "chain of command." Everyone knows exactly where he is in that chain, from whom he takes orders, and to whom he can give them. In general, people can act only in a very limited sphere without instructions or express permission from above.
• Democratic hierarchy: Final authority still resides at the top, but managers and administrators at all levels confer with those affected before making decisions. Many non-profits and some corporations operate in this way, with decisions made at the level of those who actually do the work and see the results. This model generally allows people the authority to oversee their own work, and encourages incentive.
• Collaborative management: The whole group -- which usually includes all staff and may include participants as well -- takes part in major decisions, and everyone takes part in decisions which affect her directly. At the same time, everyone has enough authority to fulfill her own responsibility and do her job effectively. The collaborative model allows everyone to feel a sense of ownership in the organization. (A food co-op or other cooperative business often functions in this way, with everyone having a vote in major decisions.)

A community-based literacy program with several sites was in danger of losing a large amount of funding because of state budget cuts. The organization convened a meeting to which all interested stakeholders, staff, students, board, and supporters were invited. The group discussed the situation and decided that the bottom line was that no sites should be closed, and that any cutbacks should reflect this thinking. The board and director took this decision as organizational policy, and made contingency plans accordingly. Even those staff members who were in danger of being laid off as a result of the cuts felt good about the decision because they knew it had been arrived at through careful discussion involving elements of every part of the organization, including themselves. (Funding ultimately came through, and no program cuts were necessary.) This is how collaborative management can work.

• Collective management: Everyone takes part in all decisions, and the organization is jointly "owned" by the whole collective as a unit. Usually, as a result, consensus (universal agreement) rather than a majority vote, is needed for a decision to be made.

If you're a new organization, and just forming, you'll need to make some serious choices. If you're designing a plan for an organization that's already operating, your choices may be easy or they may be even more difficult. Does your current model work for you? If the answer is "Not as well as we'd like," then you might consider making some changes. But how much can you change, and how fast?

Before you make changes, it's important to negotiate them with those who'll be affected. If they don't agree to a new set of rules, you'll have a difficult time putting those rules in place. Try to look at change as a process that occurs over time. If you want to change the style or philosophical structure of your organization's management -- especially if you want to change it drastically -- you may have to start with small elements and work toward a larger change. That may seem frustratingly slow, but it may lead to better results in the long run.

Although the number of management models described in this section is limited, there are, in fact, infinite varieties combining aspects of two or more. The issue here is not what box you can fit into, but what you think will work for your organization, given the people involved and the work that needs to be done. You might want to be collaborative in some areas and not in others. Your board may set some, but not all, policy. Try to consider what results particular aspects of a model will have, and don't be afraid to try something new.

Define the roles and relationships among the board, director, and staff

Roles and relationships are crucial to the smooth operation of the organization. There are a number of questions you need to ask as you define these in a way that suits your organization and gives you the management results you want:

• Where are the limits of everyone's authority?

A classic problem in non-profit organizations of all sorts is the struggle for power between the director and the board. Such struggles are not inevitable -- in fact, many, perhaps most, organizations never experience them -- but they are common enough that avoiding them should be a priority. Good directors are usually strong individuals, and good boards are usually made up of strong individuals. If they all work together, they can create a powerful organization; if they wrestle for control, they can handicap, or even destroy, an organization. Therefore, clearly describing the scope and limits of everyone's authority is extremely important.

• How and when are they expected to work together?
• On which, if any, issues is decision-making a shared process? Shared by whom?
• What are the lines of communication among them? (Can the board give instructions directly to staff, for instance? Can staff contact the board directly about issues in the organization? Or does all communication go through the director or some other specific person?)
• How will disputes among them be resolved?
• Do board, director and staff agree about how the organization is run? Conflict in this area can quickly cripple an organization.

A young organization that was essentially a collaborative had a board chair who had had considerable experience on the boards of other, more traditional, organizations. She viewed her role, and that of the board in general, as "The Boss," and felt that it was her and their prerogative to dictate policy without discussion. The director, on the other hand, was passionate about the collaborative nature of the program, and saw the board as only one element of many in the governance structure. Although they were personally quite fond of each other, the clashes between board chair and director were monumental and often public. The conflict was difficult for everyone, and wasn't effectively resolved until the board chair's term ended, and she was replaced by someone much more sympathetic to the collaborative model. It was only at that point that the organization actually jelled, and was able to plan its future development.

Spelling out the answers to these questions in job descriptions, board information, employee handbooks, etc. is one way to address this area of concern. Another is to be extremely careful to describe the roles and relationships when hiring a director or staff person, or when taking on new board members. Most important is to try to hire people who share the organization's concept of how it should operate.

Prepare carefully to hire the right people for management positions

If you hire an authoritarian as the director of a collaborative organization, you will have serious difficulties (no "may" or "might" here). By the same token, if you hire someone who doesn't clearly understand what kind of management philosophy you have in mind, or who isn't capable of fostering the relationships necessary to make your model work, it won't work. Hiring the right people is probably the most important thing you can do to make sure that the management plan you've devised is successfully carried out.

An alternative to choosing and developing a particular management structure is to hire the person you're sure you want and go with her management preferences. This works best if the organization (and the staff) has no passionate philosophical leaning toward one model or another. Hiring a terrific person who's a bad fit with the organization is often worse than hiring someone far less competent who's a good fit with the organization.

The right person, on the other hand, can -- with charisma, excellent interpersonal skills, and effective management -- bring a resistant organization around to a new way of thinking. It's a tough call, especially since it's seldom possible to get a complete picture of the person you're hiring from a resume, some references, and one or two interviews.

How can you be sure that the people you hire will do the job you want them to do? The short answer is that you never have an absolute guarantee, but there are a number of things you can do to increase your chances.

• Explain the organization's management model as precisely as possible, so no job applicant will have any question about what she's walking into, and won't find any surprises (beyond the inevitable ones that go with every job) if she takes the position.
• Try to structure the interview so it mirrors as closely as possible the management model you have in mind. In this way, you can get a sense of the applicant's comfort with the situation, and of his skill in handling it. This information should be helpful when you make your choice.
• Ask questions and use probes that really get at the applicant's philosophy of management. What does her past experience tell you? What would she be willing, and not willing, to do as a manager or administrator?
• Use the applicant's references well. Ask his former employers and colleagues about his management style, his relationships with others in the organization, the ways in which he might solve a particular problem, etc.
• Listen to your instincts. If someone makes you uncomfortable or feels "wrong," that's significant: don't ignore it, no matter how great her resume looks. If you have a sense of the people you're looking for, you'll know at least some of them when you see them.

Examine what needs to be managed

Whatever the management looks like, there is usually some agreement about what in an organization needs to be managed. The broad categories are people; money; supplies and equipment; activities; and relationships with the outside world (funders, the media, the community, target population, etc.) Each of these categories should have a set of policies and procedures that addresses whatever you can think of that might come up in that area.

Another, and extremely important, responsibility of management is to pursue the goals of the organization. In general, these goals are subsumed in the five areas mentioned. If a goal, for instance, is the acceptance of the organization in the community, that goal becomes part of relating to the outside world. If a goal is to provide ever-improving service to a particular population, that goal becomes part of the management of the organization's activities. The reality is that you should never lose sight of your organizational goals, because they define all five of these categories of management for your organization.

Not all of these management areas have to be addressed by the same person, although in small organizations they probably will be. In larger organizations, there are often assistant directors or program directors who oversee one area or another. If the organization is large enough, the director may delegate much of this work.

As with the rest of this section, considering each of these management categories has to be done with an eye toward the mission and philosophy of the organization. There is plenty of room here for making policy that's inconsistent with what you say you believe in, so it's important to ask yourself how what you're developing will fit in with your mission statement. If you're an empowerment organization, a restrictive and punitive personnel policy doesn't make sense, for instance. If one of your goals is to help low-income people learn how to manage money, your own money management should be as organized and efficient and frugal as possible (no fancy furniture or expensive offices). You need to practice what you preach, or the lesson is lost.

People: personnel management

People are the most valuable part of any organization, and often the most difficult to manage. Personnel management encompasses a number of areas:

• How, and how well, staff members do their jobs.
• Relationships among people in the organization.
• Supervision: who supervises whom and how often, what supervision means for the organization, what kinds of records are kept, what is done with them, and who has access to them.
• Quality-of life issues: staff compensation and benefits, work hours, leave policy, etc.
• Staff training and ongoing professional development.
• Hiring, firing, appeal, and grievance procedures.
• Legal or other regulations involving personnel, such as ADA (Americans with Disabilities Act), funders' requirements, non-discrimination in hiring, etc.

Money: fiscal management

Although you may hate the thought of it, your organization is, in many ways, a business, and you have to manage your finances just as any other business does if you're going to continue to operate. Fiscal management includes:

• Day-to-day management of the money you actually have: taking care of payroll, paying bills, billing others, handling cash flow, deciding where and when to make purchases of materials, supplies, and equipment.
• Accounting: keeping the books.
• Financial planning: finding new resources, tying financial planning to organizational goals, looking for sources of income to replace others that may be drying up, deciding what to do if money is short.
• Fundraising.
• Banking, investment, and capital development: taking care of the money you have, dealing with a surplus, and handling money specifically meant to be used for the long-term health and development of the organization.

Goods and services

Just buying what you need for your organization to run isn't the end of the story.

• Equipment maintenance and repair: keeping track of regular service schedules for copiers and other office equipment, as well as specialized machinery your particular organization may use to do its job (medical devices, for instance, or vehicles); getting equipment fixed or replaced when it breaks down.
• Training and updates for those who need to use particular equipment, whether computers and software or something more complicated.
• Ordering materials and supplies when needed, with an eye toward the total amount of money available for them.
• Keeping track of the price and quality of goods and services, and changing suppliers when necessary.
• Establishing and maintaining relationships with the companies and individuals from whom the organization buys goods and services.
• Defining who gets what when: who has access to what equipment, how much does each staff member get to spend for supplies for her position, etc.

Activities

What your organization actually does is usually the reason it exists. Keeping careful track of what goes on and how is therefore fundamental to the success of the organization. Among the management necessities here are:

• Making sure that the organization's activities are carried out in the way they're meant to be.
• Tracking the results of what you do, and attempting to find ways to improve your effectiveness, even if it's already high.
• Evaluating the organization's activities, with input from staff, the target population, and, if appropriate, the community at large.
• Planning for change and improvement, based on evaluations and assessment of results.
• Continually reassessing the needs of the target population, the field, or whatever is appropriate, to make sure that what you're doing is, in fact, aimed at accomplishing what's necessary.
• Keeping up to date on best practices and processes, so that you can take advantage of new and proven ideas, methods, and techniques.
• Updating staff training as the organization's activities or methods expand or change.

Relations with the outside world

If your organization aims to serve the community in some way (or is dependent on the community for resources or good will) then your management plan better include some ways for the organization to become recognized as part of the community. If your organization gets funding from state agencies, foundations, or other funders, it's important to establish and maintain good relationships with both the individuals who oversee that funding and with the funding institutions as a whole.

In reality, organizations don't deal with other organizations or communities: people deal with other people. The positive personal relationships that your organization's director, board, and staff members establish go a long way toward strengthening your organization's credibility and standing with funders and the community. A management plan that addresses this issue might include:

• Encouraging the director or other staff to be members of community and/or other organizations, and to assume positions of responsibility in those organizations where appropriate.
• Establishing, where possible, collaborative relationships with other groups and agencies (e.g. referring participants back and forth, sharing staff and equipment, or writing joint proposals, funding for which would benefit both organizations).
• Keeping a high profile in the community.

One program director made it a point never to turn down an opportunity to speak to a community group or to publicly support other agencies (delivering a keynote to United Way major donors, participating in a Big Brother/Big Sister fundraising event, turning out at a rally for a homeless shelter, etc.). He tried to make sure that the organization's name appeared in the newspaper on a regular basis, if only in public service announcements about program activities. As a result, most people in the community were aware of the program and the services it offered, and thought of it in a positive way.

• Making it a matter of policy to assist other community groups and agencies whenever possible.
• Making sure that the director and staff establish and maintain personal relationships with directors and staff of other organizations.
• Establishing and maintaining personal relationships with the appropriate people at funding agencies.
• Cooperating with funders by getting paperwork in on time, conforming to rules if you have agreed to do so, and generally trying to make their work easier.
• Establishing and maintaining relationships with representatives of the media (reporters, editors, station managers, etc.).

Write policies and procedures for each management area

Policies are the official rules, structures, and philosophical principles that guide an organization. Procedures are the actual ways in which policies and the work of the organization are carried out. (Equal opportunity in hiring, particularly with regard to minority candidates, might be a policy of an organization. Advertising in urban newspapers, adding "Minority candidates encouraged to apply" to all job ads and postings, and specifically searching out possible minority candidates are procedures that carry out this policy.) It makes life in an organization much easier for everyone -- and much less subject to legal and other challenges -- if policies and procedures for every aspect of its functioning are spelled out as clearly as possible, and everyone has access to them.

Not every organization needs a formal set of policies and procedures. If you're a small group with very little budget and few staff or rotating volunteers, you may be able to operate perfectly well with an informal set of norms and methods. As you grow, you can institute policies and procedures as they become necessary. Sometimes it's hard to tell when that moment comes: often you realize it only when there's a problem because you don't have the appropriate structure to cover something that's already happened.

The best way to assure that policies and procedures in the various areas make sense and are workable is to draft them with the participation of those who will be subject to them and who will carry them out. As has been mentioned several times in this section, it is essential that everyone in the organization feel some ownership of the management plan if it is to work reasonably well. In this instance, it simply makes sense to include those who will be affected by particular policies and procedures, because they are best qualified to understand what will work in those areas and what won't. (For the same reason, it makes sense to hire the director and other administrators before you develop policies and procedures.)

Once again, when you're finished, consider how the policies and procedures you've generated match your philosophy and mission, and reexamine any that don't.

With the writing of your policies and procedures, your management plan is done, except for one element: a plan for evaluating and improving it.

How do you evaluate and adjust a management plan?

No plan of any sort is complete without a mechanism for evaluating and improving on it. This is especially true for a management plan, which may be the foundation for an organization's success or failure. If a management plan works well in practice, then it's likely that staff will be reasonably happy and the organization's work will get done well. If the plan doesn't work well, then the reasons for that need to be understood, and management needs to be changed accordingly.

There are both formal and informal ways of telling whether a management plan is working, and both can be used as part of an evaluation plan. An informal assessment of the plan might include answers to the following questions, among others:

• Do time-sensitive tasks -- funding proposals, reports, etc. -- seem to be completed on time?
• Are there any staff grievances?
• Is there a significant number of -- and that might mean any -- complaints from the community or from funders about the organization or what it does?
• Are participants dropping out of programs or services in large numbers?
• Is the organizational atmosphere one of calm, or one of chaos? Do staff and participants seem excited or contented, or stressed and unhappy?

Staff discontent, apparent inefficiency, significant participant or community dissatisfaction, widespread stress -- these can all be warning signs that all is not right with the organization. You should take them seriously and search for their causes, so they can be addressed.

An informal evaluation is not enough, however. It's important to evaluate your organization's management just as you evaluate its work on a regular basis (typically once a year). Once again, the format and basis of your evaluation and adjustment strategy should be consistent with the philosophy and mission of your organization. Some formal ways to accomplish an evaluation could include:

• Some form of structured feedback from all constituents of the organization -- staff, board, participants, volunteers -- as well as from managers and administrators themselves.
• An organizational self-assessment, through which the organization develops a list of desired results, and checks itself against the list on a regular schedule (e.g. annually).
• The use of someone outside the organization -- a consultant, the director of another organization -- to evaluate the management function and suggest refinements or changes. (This could be part of a larger evaluation of the organization as a whole.)
• Regularly comparing policies and procedures to what really happens in the organization in the circumstances they cover. If there is not general agreement between what happens and what is supposed to happen, then something needs to be done. (That"something" could be changing policies and procedures to match practice, or vice-versa, or some other solution that might involve elements of both.)

However you choose to do it, creating a regular process for evaluating and adjusting your management plan should be an integral part of the plan itself. Once you've nailed down that process, your management plan should be complete, and it's time to get to work and put it into practice.

In Summary

The management of your organization is too important to be left to chance. Having a management plan will allow you to shape the organization the way you want to, and will make it much more likely that your work -- the reason for the organization's existence -- will be effective.

To develop a management plan that works for your organization, you should think carefully about what's consistent with your mission and philosophy (and what your organization says about itself). Then, with that in mind:

• Consciously choose or design a management model that will comfortably fit the organization and will accomplish your purposes.
• Define the relationships among director, board, staff, and volunteers to conform to the needs of effectively operating the management structure you've chosen.
• Develop, with appropriate input from those affected, a comprehensive set of policies and procedures to cover the five essential management areas: people; money; supplies and equipment; activities; and relations with the outside world.
• Design a regular system and schedule for evaluating and adjusting your management plan, so that it will continue to function successfully.

When you have a management plan that seems right for your organization, you've completed a necessary step on the road to effective action.