NO PLAN B [email protected] © Red Ochre.
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Transcript of NO PLAN B [email protected] © Red Ochre.
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What is Plan ‘A’?
What form does planning take?StrategyBusiness planningFunding applicationsBudgetsRisk analysisOther?
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Categorise of risk
People Information
Operational Property
Financial Reputation
Funding Regulatory
Social Technological
Competition Political
Management Governance
Strategic Natural
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Identifying risk
Failure to…. Inability to…
Loss of….. Inappropriate…
Concentration of... Reliance on…
Non-compliance with… Disruption to….
Lack of… Inadequate…
Reduction of… Increase in…
Conflict between... Delay in….
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Depth of Planning?
• Risk analysis – produced for TAR?• Budgets – How realistic?• Usual to take Best/Likely/Worst case scenario • Strategy exercise – how realistic?• How much is remembered after the exercise?
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General statements
If things go wrong we will….Cut costsFund raise harderDiversify incomeTake adviceRecruit new trusteesIncrease insurance coverTake on new activities/diversify
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What does this mean?
• We will act after the event• Do you have the flexibility to do so?• BP – Texas explosion – risk strategy was to change
safety procedures after an incident• Result – Deepwater Horizon• But BP big enough to absorb catastrophe
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Recent example
• Board with 3 accountants• Strategy• Risk analysis signed off• Reserves planning undertaken• Cash flow crisis in mid-August –Unexpected crisis• None of the trustees available• Panic calls to bank/ funders etc.• Loss of confidence• No Plan B
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Guidance
• Long distance • Approach to funders• Approach to bank (no OD facility)• Communications• Staff• Stakeholders• Confidence! Confidence! Confidence!• Now working trough worst case scenario
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Donald Rumsfeld
• Known Knowns – those things that we know about and so prepare for
• Known Unknowns – where there are things that we know that we don’t know about
• Unknown Unknowns – Those things that we don’t know about and have never considered
• The latter is the famous “Black Swan” event• Prepare for Doomsday scenario
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Tool
• Have a toolkit to deal with problems• Have to know what the problem might be• Think of consequences• How to react• Responsibilities• Who to approach• What to say
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Think the unthinkable
• Sudden loss of funding• Fire/flood/earthquake• Loss of chief executive• Major legal dispute• Media exposure• What else?
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Review Operations
• What do you do?• Why do you do it?• Is it necessary?• Can you discontinue it?• Do you need to be where you are?
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Create Time/Space
• Cash flow forecast!!!• When will current funding run out• How safe is current funding – particularly statutory funding• Extent of reserves• Knowing ongoing commitments and liabilities• What can be cut immediately• Timelines known• Communication channels with funders• Start dialogue with collaborators/potential partners
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Instructions
• Accountants• Solicitors• Advisors• Charity Commission?• Support organisations – NCVO/ACEVO etc.• Politicians• Media• Stakeholders
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Next Steps
• Document• Circulate• Amend• Disseminate• Estimate resources• This may lead to fundamental rethink on a number of issues• Feed this back into Plan A• Re-review Plan A
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Responsibilities
• Agree responsibilities• Sub-committees?• Agree how communications will work• Regularly review and update plan – reflect external
and internal changes• Check skills set of trustees and SMT• Can you improve this?• Establish safety nets
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Other steps
• Check skills set of trustees and SMT• Have they the breadth of skills?• Have they the networks?• Can they fundraise?• Can you improve this?