Making Critical Decisions A Practical Guide for Nonprofi t Organizations
R O B E R TA M . S N O W A N D
P A U L H . P H I L L I P S
Features an Easy-to-Use Matrix for Effective Decision Making
John Wiley & Sons, Inc.
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Making Critical Decisions
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Readers are invited to view and downloadthe supplementary Adaptable Matrix Template
that accompanies Making Critical Decisions.
If you would like to download a free electronic copy of the Adaptable Matrix Template, please visit
www.wiley.com/college/Snow
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Making Critical Decisions A Practical Guide for Nonprofi t Organizations
R O B E R TA M . S N O W A N D
P A U L H . P H I L L I P S
Features an Easy-to-Use Matrix for Effective Decision Making
John Wiley & Sons, Inc.
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Copyright © 2008 by John Wiley & Sons, Inc. All rights reserved.
Published by Jossey-BassA Wiley Imprint989 Market Street, San Francisco, CA 94103-1741 www.josseybass.com
Wiley Bicentennial logo: Richard J. Pacifi co
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, 978-750-8400, fax 978-646-8600, or on the Web at www.copyright.com. Requests to the publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, 201-748-6011, fax 201-748-6008, or online at www.wiley.com/go/permissions.
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Library of Congress Cataloging-in-Publication Data
Snow, Roberta. Making critical decisions: a practical guide for nonprofi t organizations / Roberta M. Snow and Paul H. Phillips.—1st ed. p. cm. Includes bibliographical references and index. ISBN-13: 978-0-7879-7636-1 (cloth) 1. Decision making. 2. Nonprofi t organizations—Management. I. Phillips, Paul H. II. Title. HD30.23.S668 2008 658.4’03–dc22
2007028791
Printed in the United States of America
FIRST EDITION
HB Printing 10 9 8 7 6 5 4 3 2 1
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www.josseybass.com
C O N T E N T S
Tables and Exhibits ix
Acknowledgments xiii
The Authors xv
Introduction 1
P A R T O N E
About Decision Making
Chapter 1: The Art and Science of Decision Making: Putting Theory into Practice 9
What Works 10
What Doesn’t Work 14
Reacting Versus Responding 16
Responding Versus Reacting 19
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v i
Chapter 2: Borrowing from Business: Due Diligence in Decision Making 21
What Investors Do 22
Defi ning Due Diligence 24
Staging Implementation to Reduce Risk 28
A Consistent Approach to Critical Decisions 31
Chapter 3: Managing Critical Decisions: The Who, What, and How 37
Who Decides? 38
What Choices? 43
How Do You Put It All Together? 45
Chapter 4: Enter the Matrix: Introducing an Effective Tool 47
The Matrix: Framing the Decision 48
The Rows: Weighting the Due Diligence Criteria 50
The Columns: Scoring the Due Diligence Criteria 52
Using the Matrix for Binary Decisions 59
Using the Matrix for Choices Among Similar Options 62
Using the Matrix for Choices Among Dissimilar Options 62
P A R T T W O
Making Critical Decisions
Chapter 5: Stage One: Feasibility 69
The Seductive Nature of New Ideas 70
C o n t e n t s
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C o n t e n t s v i i
Common Feasibility Decisions 71
The Feasibility Matrix 75
Chapter 6: Stage Two: Pilot 101
Piloting the Feasible Decision 102
Designing the Pilot Project 104
The Pilot Matrix 105
Chapter 7: Stage Three: Implementation 131
From Pilot to Implementation 132
A Good Implementation Plan 134
The Implementation Matrix 136
Chapter 8: Stage Four: Cutback 161
Dimensions of Cutting Back 162
The Cutback Matrix 164
Chapter 9: Putting the Matrix to Work 187
Boards of Directors 188
Executive Directors 190
Managers 193
Funders 195
Consultants 197
Chapter 10: The Decision-Making Guide 201
Assessing the Decision 201
Working Through the Matrix 203
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Appendix: Staff Renewal Decisions 207
Notes 223
Further Reading 229
Index 231
C o n t e n t s
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i x
TA B L E S A N D E X H I B I T S
Tables
Table 5.1 Percentage Agreement for Initial Proposals, Community Recreation
Center 98
Table 6.1 Summary of Innovation Fund Proposals 129
Table 6.2 Summary of Reviewer Scores: Innovation Fund Feasibility and Pilot
Proposals 130
Table 7.1 Summary of Committee Members’ Scores 157
Exhibits
Exhibit 4.1 The Matrix Template 48
Exhibit 4.2 The Basic Decision Matrix 49
Exhibit 4.3 Sample Weighting 51
Exhibit 4.4 Sample Individual Scoring Sheet 53
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Exhibit 4.5 Sample Consolidated Scoring Sheet 55
Exhibit 4.6 Consolidated Matrix Including Total Weighted Scores 57
Exhibit 4.7 Matrix with Total Weighted Scores, Total Possible Weighted Scores,
and Percentage Agreement 58
Exhibit 4.8 Binary Decision with a High Percentage of Agreement 60
Exhibit 4.9 Binary Decision with a Low Percentage of Agreement 61
Exhibit 4.10 Matrix Comparing Similar Options 63
Exhibit 4.11 Matrix Comparing Two Different Options 65
Exhibit 5.1 Sample Individual Feasibility Matrix 76
Exhibit 5.2 Summary of Ms. Smiley’s Scores 92
Exhibit 5.3 Community Recreation Center Weighted Feasibility Matrix with
Rationale and Comments 96
Exhibit 5.4 Mr. Thomas’s Evaluation of the Integrated Healthy Eating
Proposal 100
Exhibit 6.1 Sample Individual Pilot Matrix 106
Exhibit 6.2 Summary of Mr. Jones’s and Ms. Lewis’s Scores 123
Exhibit 6.3 Mr. Wheeler’s Feasibility Weightings 126
Exhibit 6.4 Mr. Wheeler’s Pilot Weightings 128
Exhibit 7.1 Sample Implementation Matrix 137
Exhibit 7.2 Summary of Mr. Charles’s, Ms. Brown’s, and Mr. Scott’s Scores 153
Exhibit 7.3 Mr. Lloyd’s and Ms. Evans’s Implementation Weightings 156
Exhibit 8.1 Sample Individual Cutback Matrix 165
Exhibit 8.2 Summary of Mr. Baxter’s Weighting and Scores 182
Exhibit 8.3 Dean Johnson’s Weighted Scoring and Percentage Agreement of
Each Cutback Option 185
Exhibit A.1 Sample Staff Renewal Matrix 211
Exhibit A.2 Summary of Ms. Miller’s Scores 222
Ta b l e s a n d E x h i b i t sx
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ForBOB
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A C K N O W L E D G M E N T S
WE ACKNOWLEDGE a number of individuals and institutions that helped us in the development of the project. First and foremost, we thank Doug Bauer, who started us on this path, sup-
ported the development of the matrix, and through his review of an early ver-
sion of the manuscript helped us produce a much more user-friendly book.
Others have played a variety of important roles at different stages of the
project:
Linda Pickthorne-Fletcher, Paul Master-Karnik, Mark Weinstein,
and Marc Scorca, who showed great patience in testing the prototype
matrices.
Benna Wilde and the members of the Donors Forum of Chicago, who
reviewed and commented on applications of the due diligence approach to
charitable giving.
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