How not-for-profits can plan for the future in uncertain times

The right balance of anticipation and reactiveness depends on the organisation's context and the landscape it faces.

An organisation such as a water company is making decisions on assets that might last 30–50 years, so it should tend more towards anticipation.

Are you reacting or anticipating? And which is better?

An organisation that operates in a complex landscape should tend towards reactiveness because complexity means anticipation is almost impossible.

I deliberately use the word “tend” because rather than being separate, anticipation and reactiveness can complement each other. Thinking about what might happen helps us react better when things change because we already have possibilities in our minds.

In my experience, organisations generally rely too much on anticipation, which seems strange for a futurist to say.

The way I look at anticipation is to create scenarios – including some that the organisation hasn’t already foreseen – and to ask questions about them. This includes improbable and preposterous scenarios. Then we can ask three questions:

1. If this future happened, what would we do?
2. If this future happened, when would we do it?
3. How do we know when “when” is?

Then, we look at strategy in three ways:

1. What is clear enough in the present that we should take standard action according to our strategic or business plan?
2. What actions can we take where we manage risk while maximising options (developing capabilities, networks, brand, trust, etc) that will give us a head start if certain things happen in the future?
3. What things are important but unclear, so we cannot take action until we have greater clarity? Then, we build a scanning system to operationalise that through formal board processes.

Let’s look at a recent example involving climate change. A few years ago, some not-for-profit organisations I worked for started seeing climate change as an existential risk in relation to funding.

The scenario they created was this: “If there is a big change in social attitudes to climate change, what happens to our funding base?”

The answer was that funding sources would flow more towards organisations trying to do something about climate change. These organisations could not change their central mission but could start doing things to reduce their carbon footprint faster to demonstrate they were not part of the problem. Even organisations that were low on capital could enter into rent-to-buy arrangements for solar installations that reduced their costs while reducing their carbon footprint without weakening their balance sheets.

Now consider a more recent example: the wild ride in global and domestic politics.

The re-election of Donald Trump, and the surprise Australian federal election result have shown how today’s “preposterous” can become tomorrow’s “plausible”.

That’s why we advise our clients that they should be considering plausible, possible, and preposterous scenarios when doing their thinking and planning.

Before the federal election, few would have predicted the Australian Labor Party (ALP) would secure 93 or 94 seats in the House of Representative. An ALP majority was seen by many as far-fetched.

And Donald Trump has shifted several preposterous scenarios into the realm of possible or plausible, consider his suggestion of turning Gaza into a resort, or his ambit tariff impositions.

Organisations must keep their options open

This shift reinforces key future-thinking principles: explore a wide range of scenarios, keep your options open, strike the right anticipation/reactiveness balance, diversify income (as a cushion against volatility) and developing organisational foresight as a core capability.

When considering scenarios, your organisation should account for even possibilities that seem improbable. This can mean keeping your options open in relation to political engagement, such as talking to all sides of politics in this term of government and keeping in mind that minority federal governments are a strong possibility in future.

In our current political landscape, it seems likely that the Prime Minister Anthony Albanese will tread carefully rather than pursue radical change. The ALP is aware of the backlash that can follow Senate overreach, as seen during the Howard years – particularly the political cost of the WorkChoices reforms.

And while the Greens are pushing a more ambitious agenda, we anticipate the ALP will maintain that moderate path. That said, some not-for-profits would be well-served to avoid overconfidence and be ready for more radical policy shifts in case they happen, especially for those with more “exposure” to changes in that area.

As Mark Twain famously said: “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.”

Anticipating policy shifts: How to act with agility

Another common scenario for not-for-profits is positioning for anticipated changes in government policy.

Rather than trying to anticipate change, organisations should create small operations for four or five possible policy futures, enabling an organisation to be ready with the people, contacts, branding, and experience if a major policy shift should occur.

These initiatives need not cost much in the short term but can be quickly shut down if necessary.

If only one of five of those initiatives significantly multiplies an organisation’s impact, that will stand as a major win, without requiring an overcommitment to a single path.

This “no-regret” approach has minimal downside if the policy doesn’t materialise—but can deliver major advantages if it does. It’s a perfect example of flexible positioning: acting now to maximise options later.