A Look at Foundation Strategy

Organizations often develop strategies to help them achieve their goals and to facilitate decision making. To explore the use of strategy in foundations, the Center for Effective Philanthropy (CEP) interviewed 42 executives and program officers from some of the largest foundations in the nation. The study compared the respondents’ views with CEP’s definition of strategy:

“A framework for decision making that is 1) focused on the external context in which the foundation works and 2) includes the hypothesized causal connection between use of foundation resources and goal achievement.”

The study found that while respondents spoke positively about using strategy in their work, their frameworks often did not meet the CEP’s definition of strategy.

For example, some respondents, categorized as “charitable bankers”, use frameworks developed from internal, historical practices, rather than ones created from an assessment of external factors and issues. Charitable bankers tend to have broad goals, which allow more flexibility to react to a variety of needs.

At the other end of the spectrum are the “total strategists” who rely more on assessments and evaluations than any other category. In many instances, the total strategists in the study explained how they rejected grant applications that were not aligned with their frameworks.

The report for this study, Beyond the Rhetoric: Foundation Strategy will help grantmakers reflect on their own decision-making frameworks and assist them in identifying more effective approaches. More information about the report is available at strategy.effectivephilanthropy.org

For other articles or books on strategic planning, click here to search our Catalog of Nonprofit Literature.