The Theory of Change represents an organization's collective belief about the causal relationships between certain actions and desired outcomes. Some find it useful to think of a theory of change as an "if...then..." statement, or a series of statements.
Surrounding the Theorgy of Change is strategy - the set of actions a nonprofit organization deliberately undertakes to achieve its mission. In order to insure that all the activities of a nonprofit organization are optimum, a strategy must stay focused on the mission and be faithful to a theory of change. The strategy also needs to be compatible with both the environment in which the organization operates and the realistic capacity of the organiztaion.
(C) The Nonprofit Coherence Framework, Allen Grossman and Stacey Childress, August 27, 2008