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Deeper Learning ADEEPER STRATEGY PLANNINGLEARNING TOOL FORSO EVERYONE WESTERN CAN CONSERVATIONSUCCEED IN A CHANGING WORLD THE WILLIAM AND FLORA HEWLETT FOUNDATION EDUCATIONENVIRONMENT PROGRAM PROGRAM STRATEGIC PLAN MARCH 22,2011 2010 Prepared by The William and Flora Hewlett Foundation and Redstone Strategy Group TABLE OF CONTENTS SUMMARY ...............................................................................................................3 1. WHAT IS THE TOOL’S PURPOSE? .....................................................................5 The tool suggests philanthropic investments ........................................................... 5 The suggestions are based on expected return estimates ......................................... 6 These suggestions are one step in the planning process .......................................... 6 2. WHAT IS THE FOUNDATION’S GOAL FOR THE WEST? ..................................7 Ensuring ecological integrity from the Rockies to the Pacific .................................. 7 Ecological integrity has six main components ......................................................... 8 Targets are set for each component of ecological integrity ...................................... 9 3. WHAT CHANGES ARE NEEDED TO REACH THE GOAL? ..............................14 Integrity estimates take into account different levels of protection ....................... 14 Integrity is estimated based on intensity of human uses ....................................... 15 4. HOW CAN THE FOUNDATION IMPROVE ECOLOGICAL INTEGRITY? .........20 A number of possible investments are considered ................................................. 20 Expected return estimates suggest the most effective investments ....................... 21 Published research and expert input are used to estimate expected return .......... 23 Integer optimization identifies a straw-man portfolio of investments ................... 24 5. WHAT ARE THE RESULTS AND HOW WILL THEY BE USED? .......................26 The suggested straw-man portfolio results in a mix of investments ...................... 26 Assumptions can affect the results, but the strategy is largely stable .................... 27 The tool’s suggestions are part of a multi-step planning process ........................... 29 6. HOW CAN THE FOUNDATION FURTHER IMPROVE THE TOOL? .................31 APPENDIX 1: PARCELS, ECOSYSTEMS, AND SPECIES .................................33 APPENDIX 2: HUMAN USE INPUTS AND ASSUMPTIONS .............................50 APPENDIX 3: SENSITIVITY SCENARIOS .........................................................60 APPENDIX 4: SOURCES ......................................................................................61 2 SUMMARY THIS DOCUMENT DESCRIBES A STRATEGY PLANNING TOOL USED BY the Hewlett Foundation to inform its Western conservation investments. The tool suggests specific philanthropic investments to help the Foundation achieve its Western conservation goals. 1. WHAT IS THE TOOL’S PURPOSE? The strategy planning tool suggests a straw-man portfolio of philanthropic investments. It is used as a starting point for planning that also incorporates expert advice. 2. WHAT IS THE FOUNDATION’S GOAL FOR THE WEST? The Foundation’s goal is to ensure the ecological integrity of the West to benefit wildlife and people. The strategy planning tool includes targets for ecosystems, species, core areas, connectivity corridors, greenhouse gas emissions, and sustainable human uses. The specific targets are guided by scientific and other expert input and are updated as information improves. 3. WHAT CHANGES ARE NEEDED TO REACH THE GOAL? Current integrity is estimated for ecosystems, species’ ranges, core areas, and corridors through analysis of human uses. These integrity levels are then compared to the Foundation’s targets to identify areas that can benefit from investments. 4. HOW CAN THE FOUNDATION IMPROVE ECOLOGICAL INTEGRITY? The tool suggests specific philanthropic investments to improve ecological integrity in areas that are below the Foundation’s targets. The tool estimates expected returns (ERs) to compare the likelihood-adjusted cost-effectiveness of the possible investments. 3 4 A STRATEGY PLANNING TOOL FOR WESTERN CONSERVATION 5. WHAT ARE THE RESULTS AND HOW WILL THEY BE USED? The tool suggests a mix of place-based and West-wide investments that are relatively stable with changes in assumptions. Beginning with this mix, the Foundation’s investment decisions then incorporate internal discussion, expert input, and consultation with potential partner funders and grantees. The result is ambitious: it requires Hewlett to invest over many years and to partner with other funders and government entities. 6. HOW CAN THE FOUNDATION FURTHER IMPROVE THE TOOL? The tool has already been significantly enhanced based on a peer review. Changing needs and data will no doubt result in furthur opportunities for improvement. This final chapter lists four changes that are likely to be valuable over time. 1 WHAT IS THE TOOL’S PURPOSE? THE STRATEGY PLANNING TOOL SUGGESTS A STRAW-MAN PORTFOLIO of philanthropic investments. It is used as a starting place for planning that also incorporates expert advice. The Hewlett Foundation has a strong tradition of work on Western conserva- tion issues. Over more than thirty years of work, the Foundation has invested $215 million in the West. Currently, it spends about $25 million on the topic each year. In an effort to maximize these investments, the Foundation is undertaking a review of its strategy in the region. As one part of this review, the Foundation decided to examine quantitative tradeoffs between potential investments in the West. The Foundation developed a strategy planning tool to make approximate data-based comparisons of different investments that could serve as a starting place for detailed strategy planning. This chapter describes the tool and its intended contribution to the full strategy planning process. THE TOOL SUGGESTS PHILANTHROPIC INVESTMENTS The strategy planning tool suggests high-return investments to be included in the Foundation’s plan for the West. It differs from conservation modeling tools, which are designed to suggest specific geographic priority areas with a high level of resolution. This tool identifies specific philanthropic investments to improve broad areas that are below conservation targets. The output of the tool is a straw-man portfolio of investments that could cost-effectively achieve all of the Foundation’s goals in the West. Since the Hewlett Foundation achieves its aims through grantmaking, a specific portfolio of possible grantable activities is more valuable than a list of priority places. The Foundation recognizes that the results of the tool are an approximation. A variety of simplifying assumptions were made to allow for comparisons and actionable recommendations at the scale of the entire West. The tool results are 5 6 A STRATEGY PLANNING TOOL FOR WESTERN CONSERVATION meant to be further refined and ground-truthed through a planning process involving the Foundation, outside experts, possible partner funders, and grant- ees to create a comprehensive conservation plan for the West. An explicit conservation plan for the whole West is valuable for several reasons. It allows the Foundation to be sure that its investments are working together to achieve lasting success in the region. It also allows the Foundation to closely measure progress towards this overall goal. Lastly, a detailed strategic plan is useful internally and with other potential funders to make the case for addi- tional funding. THE SUGGESTIONS ARE BASED ON EXPECTED RETURN ESTIMATES The portfolio of suggested investments is developed using expected return (ER) estimates. ER compares philanthropic investments based on their poten- tial impact, likelihood of success, and expected cost. Based on a number of explicit assumptions, the tool suggests investments that appear to have high potential to cost-effectively achieve the Foundation’s goals. This straw-man set of investments includes both place-based work that directly benefit priority regions and West-wide investments that improve large areas, including priority regions. Through an optimization process, a portfolio of possible high-expected return investments is suggested to achieve the Foundation’s goals while minimizing cost. THESE SUGGESTIONS ARE ONE STEP IN THE PLANNING PROCESS The quantitative comparisons performed by the strategy planning tool are meant to inform the strategy planning process, not replace it. During the initial development of the tool, outside experts and Foundation staff were heavily involved in developing assumptions and evaluating preliminary outputs. These staff and outside experts are expected to continue their involvement as the tool is further refined. In addition, the portfolio of investments generated by the strategy planning tool was reviewed both internally and externally (Figure 1). Some of the suggested strategies have been changed or eliminated based on the experience and knowledge of experts in the field, conditions on the ground in priority areas, and other FIGURE 1 Strategy planning subtle factors that were not captured by the tool. process 2 WHAT IS THE FOUNDATION’S GOAL FOR THE WEST? THE FOUNDATION’S GOAL IS TO ENSURE THE ECOLOGICAL INTEGRITY of the West to benefit wildlife and people. The strategy planning tool includes targets for ecosystems, species, core areas, connectivity corridors, greenhouse gas emissions, and sustainable human
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