THREE PAGES ESSAY (DOUBLED SPACES)

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It is extremely important for the Boys and Girls Club to create a strategic plan to handle the threat to donations caused by the organization's focus on the victims of natural disasters and to other threats to donations as well. A strategic plan, devised by strategic management, is the analysis, decisions, and actions the Boys and Girls Club undertakes in order to create and sustain a competitive advantage. Their strategy is the ideas, decisions, and actions that enable the Boys and Girls Club to succeed. Their competitive advantage allows the Boys and Girls Club to overcome the competitive forces in the industry; in this case, the threat to donations (Dess, Lumpkin, and Eisner 9). The goal of having a competitive advantage would be to encourage and facilitate donations to their organization over other organizations. The threat to donations caused by the focus on victims of natural disasters most importantly involves analysis of the external environment. This analysis has two frameworks: the general environment, which consists of elements including demographics, technology, and economics, and competitors and other organizations, which may threaten the success of the Boys and Girls Club (Dess, Lumpkin, and Eisner 15).

The first aspect of the external environment that the Boys and Girls Club must analyze is that of the general environment. The general environment is composed of factors that are external to the nonprofit industry. They are typically beyond the control of nonprofit organizations, but can have significant effects on their strategies. The general environment is made up of six elements: demographic, sociocultural, political/legal, technological, economic, and global (Dess, Lumpkin, and Eisner 47). There are different trends in each of these environmental elements that can be a threat to donations to the Boys and Girls Club. With regards to the demographic element, trends include geographic distribution of a population and greater disparities in income levels. These trends can be a threat to donations. For example, storms have caused terrible devastation recently, including the tornado that struck Moore, Oklahoma, and Superstorm Sandy that struck the Northeast. A geographic distribution of population can affect how much people donate; people that live far away from these areas and were less exposed to the environmental devastation might be less inclined to donate. A greater disparity in income levels can also affect donations because those with a lower income are not able to donate as much or at all as those with a higher income. A trend in the sociocultural element that can be a threat to donations is the postponement of family formation. For example, schools were destroyed in the tornado that hit Moore, Oklahoma. The emotional impact of that has a bigger effect on those with kids, and if some adults are delaying having kids, then that could affect their thoughts on donating. Trends in the political/legal element that could negatively affect donations include changes in legislation and financial policies. Regarding natural disasters, the amount of federal aid an area may or may not receive may affect potential donations. Regarding donations in general, changes in taxation at the local, state, and federal levels may affect potential donations. Technological trends that could have a negative affect on donations include the emergence of Internet technology and pollution/global warming. The emergence of Internet technology allows for multiple ways for people to donate to causes such as the Boys and Girls Club. With that comes the increasing knowledge that many of those donation channels are scams. People may be dissuaded from donating because they are not sure if their donations will actually reach the Boys and Girls Club. Also, some people believe that an increase in pollution and global warming has been the reason for increasingly worse storms and natural disasters. This negative mindset might have a negative impact on donations. Many economic trends pose a threat to donations. In a slowly recovering economy from one of the worst economic recessions in United States history, high interest rates, high unemployment rates, and changes in stock market valuations may have a negative impact on potential donations as people see their net income shrink. Lastly, global trends could be a threat to donations, as the world in general has been experiencing an economic downturn (Dess, Lumpkin, and Eisner 48). All six of these external environmental elements can be a threat to donations to the Boys and Girls Club.

The second aspect of the external environment that the Boys and Girls Club must analyze is that of competitors and other organizations. The competitive environment consists of many factors that relate to the nonprofit industry and can affect the strategies of nonprofit organizations. These factors include existing or potential competitors, customers, and suppliers. The most important tool that the Boys and Girls Club can use to examine the competitive environment is Michael E. Porter's Five-Forces Model of Industry Competition. Based on this model, there are five basic competitive forces: the threat of new entrants, the bargaining power of buyers, the bargaining power of suppliers, the threat of substitute products and services, and the intensity of rivalry among competitors in an industry (Dess, Lumpkin, and Eisner 56). The threat of new entrants refers to new nonprofit organizations garnering donations that might otherwise have been donated to the Boys and Girls Club. This could more likely be around the occurrence of natural disasters because more people ask for donations during times of hardship and devastation (Dess, Lumpkin, and Eisner 56). Donations could be negatively impacted by the bargaining power of buyers, or in this case, those who are receiving donations and help from the Boys and Girls Club. People who donate to the organization want to make sure that their donations are actually going to a good cause, such as helping victims of natural disasters. If the funds are being misused, then the Boys and Girls Club will have less credibility and could lose donations. (Dess, Lumpkin, and Eisner 58). Donations could also be negatively impacted by the bargaining power of suppliers, or in this case, donators. The Boys and Girls Club can only be as effective and successful as the amount of donations they receive and can use for their cause. The Boys and Girls Club is at the mercy of those who donate, so the organization must always work hard to have a positive public image so that people will be willing to donate (Dess, Lumpkin, and Eisner 59). Another competitive force is that of the threat of substitute products and services, which in this case is other nonprofit organizations that people can doante to. Although there is no price ceiling to donations, there are standards, which the Boys and Girls Club must uphold for people to be willing to donate to them over other nonprofit organizations. This could include things such as advertising or making public all of the good that has been accomplished with the money donated (Dess, Lumpkin, and Eisner 60). Lastly, the intensity of rivalry among competitors in an industry means that the Boys and Girls Club could lose past or loyal donators to other nonprofit organizations (Dess, Lumpkin, and Eisner 61). Again, this is based on public view and opinion of the Boys and Girls Club; do they do more effective and successful work with the money entrusted to them than other nonprofit organizations? Does the public favor them?

All of these factors are important for the Boys and Girls Club to consider when analyzing the external environment. The organization must know, interpret, understand, and be able to adapt to an ever changing environment. For a company as big and successful as the Boys and Girls Club, they have a very wide reach. It is imperative for them to understand the importance of public image and opinion. This is one of the most crucial parts of having a successful organization; because of technological improvements, information is made easier to find and harder to hide each and every day. They must use trends in the general environment and analysis of competitive forces to their advantage so they can limit any potential threats to donations, specifically regarding natural disasters or otherwise.