Strategic Planning (in nonprofit or for-profit organizations)

© Copyright Carter McNamara, MBA, PhD, Authenticity Consulting, LLC, experts in strategic planning.
Adapted from the Field Guide to Nonprofit Strategic Planning and Facilitation.

Simply put, strategic planning determines where an organization is going over the next year or more, how it's going to get there and how it'll know if it got there or not. The focus of a strategic plan is usually on the entire organization, while the focus of a business plan is usually on a particular product, service or program.

There are a variety of perspectives, models and approaches used in strategic planning. The way that a strategic plan is developed depends on the nature of the organization's leadership, culture of the organization, complexity of the organization's environment, size of the organization, expertise of planners, etc. For example, there are a variety of strategic planning models, including goals-based, issues-based, organic, scenario (some would assert that scenario planning is more a technique than model), etc. Goals-based planning is probably the most common and starts with focus on the organization's mission (and vision and/or values), goals to work toward the mission, strategies to achieve the goals, and action planning (who will do what and by when). Issues-based strategic planning often starts by examining issues facing the organization, strategies to address those issues, and action plans. Organic strategic planning might start by articulating the organization's vision and values and then action plans to achieve the vision while adhering to those values. Some planners prefer a particular approach to planning, eg, appreciative inquiry. Some plans are scoped to one year, many to three years, and some to five to ten years into the future. Some plans include only top-level information and no action plans. Some plans are five to eight pages long, while others can be considerably longer.

Quite often, an organization's strategic planners already know much of what will go into a strategic plan (this is true for business planning, too). However, development of the strategic plan greatly helps to clarify the organization's plans and ensure that key leaders are all "on the same script". Far more important than the strategic plan document, is the strategic planning process itself.

NOTE: Much of the following information is in regard to goals-based strategic planning, probably the most common form of strategic planning.

NOTE: For a more recent breakthrough on strategic planning, see the topic Appreciative Inquiry.

Sections of This Topic Include:

Gaining Understanding of Strategic Planning

Conducting Strategic Planning

Preparation for Strategic Planning
- - - Guidelines to Keep Perspective During Planning
- - - Need Consultant or Facilitator to Help You With Planning?
- - - Who Should Be Involved in Planning?
- - - How Many Planning Meetings Will We Need?
- - - How Do We Ensure Implementation of Our New Plan?
Strategic Analysis (environmental scan and SWOT analysis)
- - - Environmental Scan (taking a wide look around)
- - - Looking at Organization's Strength's, Weaknesses, Opportunities and Threats (SWOT)
- - - Organizational Assessments (methods to make measurements in the organization)
Setting Strategic Direction (purpose, values, vision, top-level goals and methods/strategies)
- - - Strategizing (strategic goals and methods/strategies to achieve the goals)
- - - Developing/Updating Mission Statement (the purpose of the organization)
- - - Developing/Updating Vision Statement (depiction of future state of organization and customers)
- - - Developing/Updating Values Statement (overall priorities in how organization operates)
Action Planning (annual plans, objectives, responsibilities and timelines, etc.)
Writing and Communicating the Plan
Monitoring, Evaluating and Deviating from the Plan

General Resources

Gaining Understanding of Strategic Planning

Learning Strategic Planning

First, a Point About For-Profit and Nonprofit Strategic Planning

Major differences in how organizations carry out the various steps and associated activities in the strategic planning process are more a matter of the size of the organization -- than its for-profit/nonprofit status. Small nonprofits and small for-profits tend to conduct somewhat similar planning activities that are different from those conducted in large organizations. On the other hand, large nonprofits and large for-profits tend to conduct somewhat similar planning activities that are different from those conducted in small organizations. (The focus of the planning activities is often different between for-profits and nonprofits. Nonprofits tend to focus more on matters of board development, fundraising and volunteer management. For-profits tend to focus more on activities to maximize profit.)

Also, in addition to the size of the organization, differences in how organizations carry out the planning activities are more a matter of the nature of the participants in the organization -- than its for-profit/nonprofit status. For example, detail-oriented people may prefer a linear, top-down, general-to-specific approach to planning. On the other hand, rather artistic and highly reflective people may favor of a highly divergent and "organic" approach to planning.

Therefore, the reader is encouraged to review a variety of the materials linked from this page, whether he or she is from a nonprofit or for-profit organization. Items below are marked as "nonprofit" in case the reader still prefers to focus on information presented in the context of nonprofit planning.

Benefits of Strategic Planning

Strategic planning serves a variety of purposes in organization, including to:
1. Clearly define the purpose of the organization and to establish realistic goals and objectives consistent with that mission in a defined time frame within the organization’s capacity for implementation.
2. Communicate those goals and objectives to the organization’s constituents.
3. Develop a sense of ownership of the plan.
4. Ensure the most effective use is made of the organization’s resources by focusing the resources on the key priorities.
5. Provide a base from which progress can be measured and establish a mechanism for informed change when needed.
6. Bring together of everyone’s best and most reasoned efforts have important value in building a consensus about where an organization is going.

Other reasons include that strategic planning:
7. Provides clearer focus of organization, producing more efficiency and effectiveness
8. Bridges staff and board of directors (in the case of corporations)
9. Builds strong teams in the board and the staff (in the case of corporations)
10. Provides the glue that keeps the board together (in the case of corporations)
11.Produces great satisfaction among planners around a common vision
12. Increases productivity from increased efficiency and effectiveness
13. Solves major problems

When Should Strategic Planning Be Done?

The scheduling for the strategic planning process depends on the nature and needs of the organization and the its immediate external environment. For example, planning should be carried out frequently in an organization whose products and services are in an industry that is changing rapidly . In this situation, planning might be carried out once or even twice a year and done in a very comprehensive and detailed fashion (that is, with attention to mission, vision, values, environmental scan, issues, goals, strategies, objectives, responsibilities, time lines, budgets, etc). On the other hand, if the organization has been around for many years and is in a fairly stable marketplace, then planning might be carried out once a year and only certain parts of the planning process, for example, action planning (objectives, responsibilities, time lines, budgets, etc) are updated each year. Consider the following guidelines:
1. Strategic planning should be done when an organization is just getting started. (The strategic plan is usually part of an overall business plan, along with a marketing plan, financial plan and operational/management plan.)
2. Strategic planning should also be done in preparation for a new major venture, for example, developing a new department, division, major new product or line of products, etc.
3. Strategic planning should also be conducted at least once a year in order to be ready for the coming fiscal year (the financial management of an organization is usually based on a year-to-year, or fiscal year, basis). In this case, strategic planning should be conducted in time to identify the organizational goals to be achieved at least over the coming fiscal year, resources needed to achieve those goals, and funded needed to obtain the resources. These funds are included in budget planning for the coming fiscal year. However, not all phases of strategic planning need be fully completed each year. The full strategic planning process should be conducted at least once every three years. As noted above, these activities should be conducted every year if the organization is experiencing tremendous change.
4. Each year, action plans should be updated.
5. Note that, during implementation of the plan, the progress of the implementation should be reviewed at least on a quarterly basis by the board. Again, the frequency of review depends on the extent of the rate of change in and around the organization.

Various Overviews of Strategic Planning (basics, models, skills to have)

NOTE: Although there are separate sections listed below for many of the major activities in strategic planning (for example, the sections "Developing a Mission", "Developing a Vision", etc.), this section "Various Overviews of Strategic Planning" also includes information about those activities as well.

Samples of Plans

Strategic plans come in a wide variety of formats, depending on the nature and needs of the organization.
sample plan
sample plans
sample strategic plan worksheet

Useful Skills to Have When Strategic Planning

It's best to have a team of planners conduct strategic planning. Therefore, it's important to have skills in developing and facilitating groups.
Committees (for example, may have committees do environmental scan, get input from others)Conflict Management in Groups
Conflict Management (this topic provides basics in managing conflict in groups)]
Consultants (you may want to use a consultant to help you plan and carry out strategic planning)
Creative Thinking (very important when setting goals and how they will be reached)
Innovation (very important when designing strategies, or methods to reach goals)
Decision Making
Facilitating in Face-to-Face Groups
Facilitating Online Groups (virtual communities)
Focus Groups (get input from internal & external customers to identify issues, goals, methods)
Group-Based Problem Solving and Decision Making
Meeting Management
Problem Solving
Time Management
Valuing Diversity (it's best to get a wide variety of perspectives when planning)

Preparation for Strategic Planning

Guidelines to Keep Perspective During Planning

Many managers spend most of their time "fighting fires" in the workplace. -- their time is spent realizing and reacting to problems. For these managers -- and probably for many of us -- it can be very difficult to stand back and take a hard look at what we want to accomplish and how we want to accomplish it. We're too buy doing what we think is making progress. However, one of the major differences between new and experienced managers is the skill to see the broad perspective, to take the long view on what we want to do and how we're going to do it. One of the best ways to develop this skill is through ongoing experience in strategic planning. The following guidelines may help you to get the most out of your strategic planning experience.
1. The real benefit of the strategic planning process is the process, not the plan document.
2. There is no "perfect" plan. There's doing your best at strategic thinking and implementation, and learning from what you're doing to enhance what you're doing the next time around.
3. The strategic planning process is usually not an "aha!" experience. It's like the management process itself -- it's a series of small moves that together keep the organization doing things right as it heads in the right direction.
4. In planning, things usually aren't as bad as you fear nor as good as you'd like.
5. Start simple, but start!

Need Consultant or Facilitator to Help You With Planning?

You may want to consider using a facilitator from outside of your organization if:
1. Your organization has not conducted strategic planning before.
2. For a variety of reasons, previous strategic planning was not deemed to be successful.
3. There appears to be a wide range of ideas and/or concerns among organization members about strategic planning and current organizational issues to be addressed in the plan.
4. There is no one in the organization whom members feel has sufficient facilitation skills.
5. No one in the organization feels committed to facilitating strategic planning for the organization.
6. Leaders believe that an inside facilitator will either inhibit participation from others or will not have the opportunity to fully participate in planning themselves.
7. Leaders want an objective voice, i.e., someone who is not likely to have strong predispositions about the organization's strategic issues and ideas.

(Also see Consultants (using).)

Who Should Be Involved in Planning?

Strategic planning should be conducted by a planning team. Consider the following guidelines when developing the team.
(Note that reference to boards of directors is in regard to organizations that are corporations.)
1. The chief executive and board chair should be included in the planning group, and should drive development and implementation of the plan.
2. Establish clear guidelines for membership, for example, those directly involved in planning, those who will provide key information to the process, those who will review the plan document, those who will authorize the document, etc.
3. A primary responsibility of a board of directors is strategic planning to effectively lead the organization. Therefore, insist that the board be strongly involved in planning, often including assigning a planning committee (often, the same as the executive committee).
4. Ask if the board membership is representative of the organization’s clientele and community, and if they are not, the organization may want to involve more representation in planning. If the board chair or chief executive balks at including more of the board members in planning, then the chief executive and/or board chair needs to seriously consider how serious the organization is about strategic planning!
5. Always include in the group, at least one person who ultimately has authority to make strategic decisions, for example, to select which goals will be achieved and how.
6. Ensure that as many stakeholders as possible are involved in the planning process.
7. Involve at least those who are responsible for composing and implementing the plan.
8. Involve someone to administrate the process, including arranging meetings, helping to record key information, helping with flipcharts, monitoring status of prework, etc.
9. Consider having the above administrator record the major steps in the planning process to help the organization conduct its own planning when the plan is next updated.

Note the following considerations:
10. Different types of members may be needed more at different times in the planning process, for example, strong board involvement in determining the organization’s strategic direction (mission, vision, and values), and then more staff involvement in determining the organization’s strategic analysis to determine its current issues and goals, and then primarily the staff to determine the strategies needed to address the issues and meet the goals.
11. In general, where there's any doubt about whether a certain someone should be involved in planning, it's best to involve them. It's worse to exclude someone useful then it is to have one or two extra people in planning -- this is true in particular with organizations where board members often do not have extensive expertise about the organization and its products or services.
12. Therefore, an organization may be better off to involve board and staff planners as much as possible in all phases of planning. Mixing the board and staff during planning helps board members understand the day-to-day issues of the organization, and helps the staff to understand the top-level issues of the organization.

How Many Planning Meetings Will We Need?

Number and Duration of Planning Meetings

1. New planners usually want to know how many meetings will be needed and what is needed for each meeting, i.e., they want a procedure for strategic planning. The number of meetings depends on whether the organization has done planning before, how many strategic issues and goals the organization faces, whether the culture of the organization prefers short or long meetings, and how much time the organization is willing to commit to strategic planning.
2. Attempt to complete strategic planning in at most two to three months, or momentum will be lost and the planning effort may fall apart.

Scheduling of Meetings

1. Have each meeting at most two to three weeks apart when planning. It's too easy to lose momentum otherwise.
2. The most important factor in accomplishing complete attendance to planning meetings is evidence of strong support from executives. Therefore, ensure that executives a) issue clear direction that they strongly support and value the strategic planning process, and b) are visibly involved in the planning process.

An Example Planning Process and Design of Meetings

One example of a brief planning process is the following which includes four planning meetings and develops a top-level strategic plan which is later translated into a yearly operating plan by the staff:
1. Planning starts with a half-day or all-day board retreat and includes introductions by the board chair and/or chief executive, their explanations of the organization's benefits from strategic planning and the organization's commitment to the planning process, the facilitator's overview of the planning process, and the board chairs and/or chief executive’s explanation of who will be involved in the planning process. In the retreat, the organization may then begin the next step in planning, whether this be visiting their mission, vision, values, etc. or identifying current issues and goals to which strategies will need to be developed. (Goals are often reworded issues.) Planners are asked to think about strategies before the next meeting.
2. The next meeting focuses on finalizing strategies to deal with each issue. Before the next meeting, a subcommittee is charged to draft the planning document, which includes updated mission, vision, and values, and also finalized strategic issues, goals, strategies. This document is distributed before the next meeting.
3. In the next meeting, planners exchange feedback about the content and format of the planning document. Feedback is incorporated in the document and it is distributed before the next meeting.
4. The next meeting does not require entire attention to the plan, e.g., the document is authorized by the board during a regular board meeting.
5. Note that in the above example, various subcommittees might be charged to gather additional information and distribute it before the next planning meeting.
6 Note, too, that the staff may take this document and establish a yearly operating plan which details what strategies will be implemented over the next year, who will do them, and by when.
7. No matter how serious organizations are about strategic planning, they usually have strong concerns about being able to find time to attend frequent meetings. This concern can be addressed by ensuring meetings are well managed, having short meetings as needed rather than having fewer but longer meetings, and having realistic expectations from the planning project.

How Do We Ensure Implementation of Our New Plan?

A frequent complaint about the strategic planning process is that it produces a document that ends up collecting dust on a shelf -- the organization ignores the precious information depicted in the document.

The following guidelines will help ensure that the plan is implemented.
(Note that reference to boards of directors is in regard to organizations that are corporations.
1. When conducting the planning process, involve the people who will be responsible for implementing the plan. Use a cross-functional team (representatives from each of the major organization’s products or service) to ensure the plan is realistic and collaborative.
2. Ensure the plan is realistic. Continue asking planning participants “Is this realistic? Can you really do this?”
3. Organize the overall strategic plan into smaller action plans, often including an action plan (or work plan) for each committee on the board.
4. In the overall planning document, specify who is doing what and by when (action plans are often referenced in the implementation section of the overall strategic plan). Some organizations may elect to include the action plans in a separate document from the strategic plan, which would include only the mission, vision, values, key issues and goals, and strategies. This approach carries some risk that the board will lose focus on the action plans.
5. In an implementation section in the plan, specify and clarify the plan’s implementation roles and responsibilities. Be sure to detail particularly the first 90 days of the implementation of the plan. Build in regular reviews of status of the implementation of the plan.
6. Translate the strategic plan’s actions into job descriptions and personnel performance reviews.
7. Communicate the role of follow-ups to the plan. If people know the action plans will be regularly reviewed, implementers tend to do their jobs before they’re checked on.
8. Be sure to document and distribute the plan, including inviting review input from all.
9. Be sure that one internal person has ultimate responsibility that the plan is enacted in a timely fashion.
10. The chief executive’s support of the plan is a major driver to the plan’s implementation. Integrate the plan’s goals and objectives into the chief executive’s performance reviews.
11. Place huge emphasis on feedback to the board’s executive committee from the planning participants.

Consider all or some of the following to ensure the plan is implemented.
12. Have designated rotating “checkers” to verify, e.g., every quarter, if each implementer completed their assigned tasks.
13. Have pairs of people be responsible for tasks. Have each partner commit to helping the other to finish the other’s tasks on time.

CONDUCTING STRATEGIC PLANNING

Strategic Analysis (Environmental Scan and SWOT)

A frequent complaint about strategic plans is that they are merely "to-do" lists of what to accomplish over the next few years. Or, others complain that strategic planning never seems to come in handy when the organization is faced with having to make a difficult, major decision. Or, other complain that strategic planning really doesn't help the organization face the future. These complaints arise because organizations fail to conduct a thorough strategic analysis as part of their strategic planning process. Instead, planners decide to plan only from what they know now. This makes the planning process much less strategic and a lot more guesswork. Strategic analysis is the heart of the strategic planning process and should not be ignored.

(Note that some planners prefer to identify/update the mission, vision and values statements before conducting the strategic analysis. Others prefer to identify/update these items after the strategic analysis. In this library, these items are addressed as part of the next major section "Setting Strategic Direction".)

Environmental Scan (taking a wide look around)

Basics

Taking Stock (very basic overview of environmental scanning)
Stakeholder Consultations
Look Out! Environmental Scanning for Associations

Various Views on Future

Success in the 21st Century

Strengths, Weaknesses, Opportunities and Threats (SWOT Analysis)

Note that this activity can be helped a lot if you've already been following good practices of organizational performance management. For more information, see Organizational Performance.

Basics

SWOT: Strategic Planning Process Worksheet
Basics of Identifying Strategic Issues and Goals

Example

Example of a SWOT analysis another example
another example
another example

Various Organizational Assessments

The following assessments might be useful in helping you to take a wide look at your organization.
Organizational Assessments for For-profits
Organizational Assessments for Nonprofits

Identifying Strategic Directions

Note that many writers discuss the identification of strategic goals concurrent to the identification of the associated methods, or strategies, to achieve those goals. Consequently, materials referenced from section often address both goals and strategies.

Strategizing (Goals and Methods/Strategies to Achieve Goals)

(Note that skills in Creative Thinking and Innovation are very important when strategizing, or setting overall organizational goals and how they will be reached.)
Basics of Strategizing (during strategic planning)
select Strategic Planning from the pulldown menu
Strategy Is ...
Strategy: Definitions and Meaning
Three Forms of Strategy
Setting Goals and Objectives
The Goals Grid -- A Tool for Clarifying Goals & Objectives
Strategizing
How to Develop a Training Strategy

Also consider these topics:

Organizational Change and Development
generally about aligning goals throughout organization
Management-by-Objectives (specifics about aligning goals throughout organization)
Project Management (thorough planning and tracking to achieve goals)

Developing/Updating a Mission Statement

Basics in Developing a Mission Statement
Pillars of Planning Mission, Vision and Values
Mission / Vision Exercise
What should our mission statement say?(presented in context of nonprofits)
Suggestion: Use your browser to do a search for "mission statements". This likely will result in numerous links to a wide variety of organization's mission statements that you can review as samples of mission statements.

Developing/Updating a Vision Statement

Creating an Organization's Vision
Basics in Developing a Vision Statement
Strategic Visioning Process
Creating a Vision
Building a Visionary Organization is a Do-It-Yourself Project
Suggestion: Use your browser to do a search for "vision statements". This likely will result in numerous links to a wide variety of organization's vision statements that you can review as samples of vision statements.

Developing/Updating a Values Statement

Basics in Developing a Values Statement
Suggestion: Use your browser to do a search for "values statements". This likely will result in numerous links to a wide variety of organization's values statements that you can review as samples of values statements.

Action Planning (objectives, responsibilities, timelines)

Strategic planning can be exhilarating when coming up with new visions and missions and values, talking about long-standing issues in the workplace and coming up with new and exciting opportunities. But without careful action planning -- and diligently ensuring actions are carried out -- the plan ends up collecting dust on a shelf. See
Basics of Action Planning (as part of strategic planning)
The Goals Grid -- A Tool for Clarifying Goals & Objectives

Also see:

Setting Employee Goals
Management-by-Objectives (specifics about aligning goals throughout org.)
Project Management (thorough planning and tracking to reach goals)

Writing and Communicating the Plan

I've you've followed the guidelines, so far, throughout this Library topic, then writing your plan will be fairly straightforward. A frequent mistake at this point is not communicating the plan to enough people, including external stakeholders. The following link will be useful to you now.
Basics of Writing and Communicating Your Plan

Monitoring, Evaluating and Deviating from the Plan

As stated several times throughout this library topics (and in materials linked from it), too many strategic plans end up collecting dust on a shelf. Monitoring and evaluating the planning activities and status of implementation of the plan is -- for many organizations -- as important as identifying strategic issues and goals. One advantage of monitoring and evaluation is to ensure that the organization is following the direction established during strategic planning. That advantage is obvious. However, another major advantage is that the management can learn a great deal about the organization and how to manage it by continuing to monitor and evaluate the planning activities and the status of the implementation of the plan. Note that plans are guidelines. They aren't rules. It's OK to deviate from a plan. But planners should understand the reason for the deviations and update the plan to reflect the new direction.
Basics of Monitoring and Evaluating and Deviating from the Strategic Plan

One Way to Make Sure Plans Actually Are Implemented

It's one thing to develop a plan. It's another to actually implement the plan. Far too many plans sit untouched on shelves. A low-cost, straightforward approach to share ongoing support and accountabilities to implement a plan is to use peer coaching groups. That approach is brought to you by Authenticity Consulting, LLC -- the same company that brings you this Free Management Library.
Using Peer Coaching Groups(sm) to Ensure Accountability and Action

General Resources

Strategic Planning: numerous articles organized in order of planning process
10-Day Strategic Plan
Venture Philanthropy Partners extensive manual (nonprofits
How to Ensure Your Strategic Plan Becomes a Valued Tool

For the Category of Strategic Planning:

Recommended Books

For-Profit Specific

Nonprofit Specific

For-Profit Specific

The following books are recommended because of their highly practical nature and often because they include a wide range of information about this Library topic. To get more information about each book, just hover your cursor over the image of the book. A "bubble" of information will be displayed. You can click on the title of the book in that bubble to get more information, too.

Nonprofit-Specific

Field Guide to Nonprofit Strategic Planning and Facilitation: by Carter McNamara, published by Authenticity Consulting, LLC. Step-by-step guidelines to customize and facilitate planners to implement the best strategic planning process to suit the particular nature and needs of their nonprofit. This is one of the few books, if any, that explains how to actually facilitate planning. Includes many online forms that can be downloaded and used by planners. Many materials in this Library's topic about strategic planning are adapted from this book.

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Strategic Planning (in nonprofit or for-profit organizations)

Sections of This Topic Include:

Gaining Understanding of Strategic Planning

Conducting Strategic Planning

General Resources

Gaining Understanding of Strategic Planning

Learning Strategic Planning

First, a Point About For-Profit and Nonprofit Strategic Planning

Recommended Approach for the Reader to Learn Strategic Planning

Benefits of Strategic Planning

When Should Strategic Planning Be Done?

Various Overviews of Strategic Planning (basics, models, skills to have)

General Overviews

Basic Overview of Variety of Planning Models

One Example of a Basic, Overall Approach

Special Topics

Samples of Plans

Useful Skills to Have When Strategic Planning

Preparation for Strategic Planning

Guidelines to Keep Perspective During Planning

Need Consultant or Facilitator to Help You With Planning?

Who Should Be Involved in Planning?

How Many Planning Meetings Will We Need?

Number and Duration of Planning Meetings

Scheduling of Meetings

An Example Planning Process and Design of Meetings

How Do We Ensure Implementation of Our New Plan?

CONDUCTING STRATEGIC PLANNING

Strategic Analysis (Environmental Scan and SWOT)

Environmental Scan (taking a wide look around)

Basics

Various Views on Future

Strengths, Weaknesses, Opportunities and Threats (SWOT Analysis)

Basics

Example

Various Organizational Assessments

Identifying Strategic Directions

Strategizing (Goals and Methods/Strategies to Achieve Goals)

Also consider these topics:

Developing/Updating a Mission Statement

Developing/Updating a Vision Statement

Developing/Updating a Values Statement

Action Planning (objectives, responsibilities, timelines)

Also see:

Writing and Communicating the Plan

Monitoring, Evaluating and Deviating from the Plan

One Way to Make Sure Plans Actually Are Implemented

General Resources

For the Category of Strategic Planning:

Related Library Topics

Recommended Books

For-Profit Specific

Nonprofit-Specific

Also See

Planning and Project Management -- Recommended Books

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General Resources