This blog is about Tactical Philanthropy. Phil at Gift Hub recently complained that most philanthropic planning is tactical and so I want to take a moment to break down the difference between Strategy and Tactics and explain why I think they are equally important disciplines.
The words Strategy and Tactics come to us from the military. I’m sure that there are readers who will cringe to see me use a military example in a discussion of philanthropy, but the root of these words is important to their understanding.
Webster defines Strategy:
“The science and art of employing the political, economic, psychological, and military forces of a nation or group of nations to afford the maximum support to adopted policies in peace or war.”
Webster defines Tactics:
"1) A device for accomplishing an end, 2) a method of employing forces in combat."
"Military minds often think in terms of strategy and tactics.
Strategy is immutable; it is a Big Picture look at a problem that focuses upon the entire forest and not individual trees. Military concepts such as objective, offensive, simplicity, unity of command, mass, economy of force, maneuver, surprise, and security represent the timeless principles of strategy. Why do you think Sun Tzu’s The Art of War has been a best seller for thousands of years and translated into every imaginable language? Because it teaches strategy and the lessons of strategy are timeless. They are bound to our very nature as humans.
Tactics vary with circumstances and, especially, technology. If I were to teach you how to be a soldier during the American Revolution, you would learn how to form and maneuver in lines, perform the 27 steps in loading and firing a musket, and how to ride and tend to a horse. Naturally, yesterday’s tactics won’t win today’s wars – but yesterday’s strategies still win today’s wars… and will win them tomorrow and into the future.
So, tactics present a Small Picture perspective where individual trees are in focus but the Big Picture of the forest is not. Just as your eyes have to look up from this page to refocus on the larger room you’re reading it in, so strategy and tactics require a different focus."
I agree with Phil when he complains that most philanthropic planners are tactical. Tactics without strategy is a wasteful expenditure of resources. Tactical advisors who do not comprehend strategy are like generals fighting a war with no purpose. Tactics must always serve the goal of strategy. A tactical advisor must realize that a tool like a charitable remainder trust is just a way to manipulate money unless it is used to further the philanthropic strategy of the donor/client.
In general, most tactical advisors are engaging in product sales. Whether they pitch charitable gift annuities or donor advised funds, they are incentivised to view their product as the best tactic to further all strategies. Tactical Philanthropy is an advice-based approach that views all tactics on equal footing and carefully selects the tool(s) most useful in each case.
In recent years, the media has characterized donor advised funds as a new “competitor” to private foundations. The fact is these two vehicles are different tactics and each serve different types of strategies more appropriately. While they can be used for some similar functions, viewing them as competitors is like arguing about whether a Toyota Prius Hybrid is better or worse than a Ford F-150 pickup. Sure, they both can take you from point A to point B, but if you are concerned with hauling a lot of stuff around, the Prius is the wrong Tactic to achieve your Strategic goals. Likewise, if you want a quick, easy, clean and cheap way to get around town, the Prius is a better Tactic than the F-150.
Phil seems disturbed that so much of the activity around philanthropy seems to miss the point. Recently he discussed Pierre Omidyar and worried that there is “more in Pierre of Adam Smith than Aristotle or Jesus.” I agree that we need more “guiding lights” for today’s New Philanthropists. We need more people like Tracy Gary, Charles Collier and Peter Karoff. For without enlighten strategy, tactics are powerful tools put to waste.
In the introduction to Collier’s book, Wealth in Families, he states:
Together, these pages serve as a reflection on the meaning and purpose of family wealth. These essential “why” questions surrounding wealth form the subtext of each chapter. I do not delve into the specific arrangements and products associated with estate planning and charitable giving because they are simply secondary to the questions of meaning, legacy, and how we grow great human beings.
I agree that tactics are secondary to strategy. But, secondary in the sense of “coming after”, not in the sense of “lesser importance.”
This blog is about Tactical Philanthropy. A tactical approach to philanthropic giving that fully acknowledges the primary need for strategy. The Second Great Wave of Philanthropy will need many different kinds of participants. I hope that this blog can play a small role in further the intelligent use of the tactics we will need to fulfill the promise of the Second Great Wave.