Phase 2

Step 2.04 , Water Fund Strategic Plan


A Water Fund Strategic Plan is created to establish a long term (5-year) plan that creates clarity, focus and a shared roadmap for implementing important strategic choices made by the leadership of a Water Fund.

Key Ideas

A Water Fund Strategic Plan is typically a 5 year plan that guides the operations of a Water Fund. This plan aims to achieve the following:

  • Create clarity

    To establish a framework for documenting and evolving important strategic choices made by Water Fund leadership.
  • Create focus

    To allow for more effective goal-setting and purpose-based leadership / action by the Water Fund.
  • Create a shared roadmap

    To drive measurable progress toward relevant impact and systemic change.

Overarching Considerations

Before developing a Strategic Plan, your team should be familiar with the concepts outlined below.

Strategic Planning

  • Understand the Theory of Change: how might a Water Fund impact water security?

    Creating the Strategic Plan for a Water Fund is initially done during the Design Phase and then repeated every 5 years during the Operations Phase. Before starting the Strategic Plan, it is important to understand where the Water Fund is in the Theory of Change model. The overall goal of the Theory of Change is to build credibility to gain relevant policy influence which positions a Water Fund to help create impact a scale in ways that improve water security, while securing co-benefits such as biodiversity conservation, climate change mitigation, and human health and well-being.

    • Credibility: As a credible contributor to improved water security, the Water Fund is gaining social and political capital with relevant and influential actors.
    • Influence: As a formal participant in relevant decision-making and governance processes, the Water Fund holds evidence of its success in influencing water security-related public policy. 
    • Impact @ Scale: As an influential entity, Water Funds are now prepared and capable of helping create systemic change and positive water security impacts at scale.
  • Do you have all the data/information needed to begin the Strategic Plan?

    Strategic Plans can be completed more quickly depending on the local context and the degree to which supplemental studies must be completed to support the Plan.

    Depending on if there is any missing information and the comfort/confidence level of the Water Fund Board, additional studies (e.g., to help optimize a portfolio of interventions) may be needed to address open questions or concerns Board members may have. You will need to balance this uncertainty against the need to sustain the momentum and progress forward, ensuring that the team does not become caught-up in a state of ‘analysis paralysis’, where no decisions are ever actually made due to uncertainty.

    Nonetheless, if Board members raise significant concerns, it will be important to take the time to conduct relevant assessments, research and/or studies to get answers to the most pressing questions, ensuring the Board is confident and supportive of the Strategic Plan. 

  • Engage the Water Fund Board through iterative work efforts

    The process, or mechanics, of engaging the Water Fund Board during the strategic planning process should be thought of as a series of iterative work efforts.


    Work efforts should consist of conceptualizing a practical approach with the Water Fund Team, and then engaging with the Water Fund Board to vet and refine before moving to the next work effort. It is important to include the Water Fund Board throughout the strategic planning process in this iterative approach to ensure their support and agreement. Not including the Water Fund Board in this manner could create re-work and hinder the progress of the strategic planning process.

  • Remember your audience when engaging the Water Fund Board

    When meeting, consider the target audiences (Water Fund Board, Water Fund Director, and supporting teams) and what they need.

    When meeting with the Water Fund Board use a presentation type approach rather than a narrative approach. The Board is interested in the “big picture” and should not be given the detailed, longer versions of materials unless it is needed to answer their questions.  Using presentations and summarizing key concepts is common practice with Boards.

  • Decisions must be made without 100% certainty

    The Strategic Planning Team and Water Fund Board must be comfortable making decisions and moving forward without 100% certainty and complete data.

    The expectations of Board members are typically that the Water Fund will achieve its goals. To demonstrate how these goals will be achieved, the team must balance the need for information required to develop an effective strategy versus the impacts that securing more data and certainty would have on the overall effort (e.g. additional time, resources).

    While the Water Fund Team’s risk tolerance is important, the Board’s risk tolerance in decision-making should be the core driver behind the substance and pace of the process.

  • Identify the skills and capabilities you will need prior to beginning the process

    The following expertise areas will be key to include on your team:

    1)  Who will lead the process?

    This should be a skilled facilitator that supports the Water Fund Director (or the WF Director themselves if they feel comfortable facilitating and participating in the process), who should have strong interpersonal and communication skills, organizational agility, and strategic focus for leading the planning process.

    2) Who helped to define the challenge(s) in the Feasibility Phase or might help refine your understanding of it?

    Include relevant technical team members that worked on the Feasibility Phase and understand the water security challenges and local context.

    3) Who helped define potential interventions in the Feasibility Phase or might help moving forward?

    Include team members that understand the actions the water fund can take to help improve water security, implement those interventions, and engage stakeholders in the context of the Theory of Change (build credibility to gain relevant policy influence and create impact a scale in ways that improve water security).

    4) Who can help with the design studies and technical aspects of the strategic plan?

    Include team members with scientific and technical expertise.

    5) Who can help conduct financial analyses and planning?

    Include team members with cost estimating and finance expertise.

    6) Who can help plan for operations?

    Include team members with expertise in administration, management tools, operational systems, hiring practices, and so on. 

    7) Who can help develop engagement and communications strategies?

    Include team members with expertise in public affairs, communications and marketing. 

  • Structure the Strategic Plan around 4 Areas of Action

    It is recommended that the Water Fund’s work be structured across 4 broad Areas of Action that will be common for most (if not all) Water Funds.


    Governance (convene stakeholders to build credibility)

    To assemble and organize influential and trusted stakeholders to support the Water Fund. To be a central collaboration forum and a leading entity to help improve water security in the region. This includes encouraging stakeholders from all sectors to participate as partners, promoters or allies of the Water Fund.

    Implementation & Science (implement and monitor projects to demonstrate impact)

    To execute highly visible natural infrastructure and other projects that demonstrate the Water Fund’s ability to create positive impacts on water security in the region.

    Communications (articulate benefits of Water Fund to gain influence)

    To create a shared vision of water security priorities which generates collective and coordinated action in the region to address these concerns.

     Finance (secure long-term resources and implement processes to ensure longevity)

    The development and implementation of the Water Fund’s model for financial sustainability, which is capable of financing and ensuring the ongoing operation (including implementation of selected interventions and execution of other related activities) of the Water Fund.

  • Strategic planning is an iterative process

    The development of the Strategic Plan is an iterative process, requiring strategically timed discussions with the Water Fund Board, team, and key stakeholders. 


What is the process for developing a Strategic Plan?

  1. Clarifying the Challenge

    The purpose of Clarifying the Challenge is to be clear on: 1) how to define the challenges the Water Fund is going to help address, 2) what success looks like and how the Water Fund contributes to that success, 3) how to identify the risks and obstacles and how they can be mitigated/navigated, and 4) how to formulate the Water Fund’s strategy, objectives, and 5-year goals by tangible actions the Water Fund will conduct.

    Learn more
  2. Formulating Interventions

    The purpose of formulating interventions is to conceptualize the portfolio of interventions, associated targets, and resource requirements for the Water Fund.

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  3. Supporting Interventions

    The purpose of supporting interventions is to: 1) establish engagement plans per stakeholder category and high-level protocols for communications, 2) create a plan to secure resources (i.e., fundraising/financing), and 3) to develop a 5-year roadmap to track milestone progress toward the Water Fund goals.

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The Mexico City Water Fund led a comprehensive strategic planning process that should be referred to as an excellent example of a 5-year WF Strategic Plan.

Latin America: