Why Nonprofits Need An Environmental Scan (And What It Really Is)

Why Nonprofits Need An Environmental Scan (And What It Really Is)

Nonprofit leaders have so much to do. Many of you are jacks of all trades, including of course, being aware of the environment in which you operate, and planning for the future. Most probably you think you know who your competitors are, and you may do a casual examination of the external environment. But do you really understand the competitive landscape in which you operate? And do you consistently search for new ideas and best practices to contribute to your long range planning? In many ways, there is very little that is totally new – someone is doing it somewhere in the world. Chances are with a bit of research, you can create new ideas from old ones and gain a new edge without reinventing the wheel. Learning from others mistakes is equally useful. What about your image in the political, business and consumer communities in your area? Do you have a clear idea of what others think of your organization such as elected officials, heads of companies that could potentially support you, and stakeholders who already give to you – would they give more under the right circumstances? Do you and your staff members have a realistic understanding of what your strengths, weaknesses, threats, and opportunities really are (SWOT)? If you ask your staff to create a SWOT, you may be surprised at their answers.

So, what is an Environmental Scan?
Some people call it a Competitive Analysis, but it is so much more. Generally, it is a study of your specific area of expertise (your cause) , both locally and in many cases nationally. It provides an analysis of your competitors – sometimes even those that are not obvious and may surprise you – and a wide sweep of similar organizations outside your area that may suggest ideas for best practices and growth strategies. It gives you guidance on your standing in the nonprofit world in your city. It provides a macro guide to understanding your strengths, weaknesses, threats, and opportunities. It includes the following steps:
* Analysis of Demographic statistics, current and future, predicting trends that impact your specialty
*Analysis of local nonprofits in your subject matter (competitors)
*Analysis of national nonprofits with similar subject matter, highlighting growth opportunities and challenges
*Interviews with stakeholders, and community leaders
*Discussions with board, staff, and volunteers to share perceived competitor information and SWOT perceptions

What benefits will you gain from conducting an Environmental Scan?
What you will get is a very clear understanding of what you are up against, and where the opportunities might be. You may confirm some things you already know, though I would bet you will gain more new information than you might think. A good ES can literally point you in the direction of growth positioning you to begin a new strategic planning project. Most importantly, if you involve some of your staff, board, volunteers, and other stakeholders in the process, it will spark interest, new thoughts and encouragement, and serve as an educational tool, while demonstrating your desire to plan and change. When people sit in a room to discuss their strengths, weaknesses, threats, and opportunities, you will be surprised at what you hear, especially when people have access to research about new ideas, best practices, and changing demographic information. It can be a beautiful thing.

Bottom line, many nonprofits constantly talk about strategic planning. Yet, if they don’t take the time to conduct a comprehensive Environmental Scan first, they may not have the planning tools needed so that decision makers can begin planning for the future of an organization with vital information that may affect the direction of the plan.