Friday, July 13, 2018

Best Board Books #1: Boards That Lead


Board members and CEOs often ask me to recommend the best book on board governance.
Of course—one size doesn’t fit all. There is no one “perfect” book for every board. It depends on many factors, as Dan Busby and I point out in “Lesson 38: Great Boards Delegate Their Reading” in Lessons From the Nonprofit Boardroom.


How would you rate your current board members’ competencies and experiences?
• Do most have previous board experiences that were healthy (not dysfunctional)?
• Does your board agree where they are on the continuum from Policy Governance® to hands-on boards? 
• Is there alignment with the 10 or more traditional roles and responsibilities of the board?

Your answers would help me suggest the “best” book for you—whether for everyone to read before your next board retreat, or for a quick “10 Minutes for Governance” book review by one board member at your next board meeting.

Over the coming weeks, I’ll suggest some of the most insightful books on board governance—some “secular” and some Christ-centered. Pick one that fits your board’s culture and needs.

BOOK #1: Boards That Lead: When to Take Charge, When to Partner, and When to Stay Out of the Way, by Ram Charan, Dennis Carey and Michael Useem

You can read my book review by clicking here. Here’s a taste: Learning boards will discover vast insights and practical next steps in Boards That Lead:

   • Boards should ask new CEOs to draft a succession plan immediately (and the annual self-assessment should measure progress).
   • Caution! Leaders can change dramatically when they get the brass ring.
   • Nothing can make up for the wrong choice of CEO.
   • Ten principles for finding the right CEO (Warning: “Review outside consultants carefully to prevent conflicts of interest.”)
   • In risk management, why quantification alone is a false crutch.
   • The value of a one-pager with agenda/decision highlights sent before every meeting
   • The learned art of what to feed to the board
   • How to coach new board members to stay at the right “altitude” in board meetings
   • How to get maximum value from an advisory council or board (They quote Roger Kenny who says advisory boards are “like the Marines: They get you on the beach.”)

And then this PowerPoint-worthy wisdom: 
“Execution is where management starts and the board stops.”

BOARD DISCUSSION: Is our CEO “feeding us” the appropriate and right amount of information, inspiration, and context for our “heavy lifting” topics prior to each board meeting. What do you appreciate? What would improve this process?

MORE RESOURCES: Follow the “40 Blogs. 40 Wednesdays.” color commentaries on Lessons From the Nonprofit Boardroom. Click here.

Friday, June 29, 2018

Try “Stoppage Time” at Your Next Board Meeting

The 2018 World Cup has captivated my mornings over the last two weeks and I’m not even a soccer guy (or should I say “football” guy—for my friends outside the U.S.). 

One quick note, while I can still utter this: “Go Sweden!” (As of today, Sweden is one of 16 teams in the knockout stage which starts on June 30. Win or go home.)

If you’re a soccer neophyte like me, you’ve appreciated the fast-moving game and the absence of TV commercials, time-outs, or interruptions in either half (45 minutes each). The reason: stoppage time. But then—try to explain “stoppage time” to your spouse or water cooler colleagues. 

Google “stoppage time in soccer” and you’ll gain some insight. “Because there's no time allotted for…commercials and the advertising fare that clogs up most American sports broadcasts, soccer games consist of 90 straight minutes of unfettered gameplay. But, that gameplay is almost always interrupted by injuries, substitutions, and the occasional rogue pitch invader. That means, to account for the unforeseen stoppages in play, a few minutes are added at the end of each half. Longer stretches are usually tacked on to the end of the game, typically resulting in an extra three or four minutes on top of the standard 90.”

That got me thinking. What if your board chair instituted stoppage time at your next board meeting? “Well, it’s 5 p.m., and time to adjourn, but I’ve tracked stoppage time and I’m adding on another 23 minutes because…”
   • “Frank, you took us down a very unproductive back alley when you went from policy issues to operations. Your in-the-weeds side trip wasted seven minutes.”
   • “Maria, I clocked your point of order at 10 minutes. Your question was helpful, but then Kim, Cameron, and Angela all piled on with unnecessary speeches and nothing was resolved.”
   • “Steve, as our CEO, you give us great leadership. But next time, please coach your VP so she stops reading her reports to the board. We had all read the report before the meeting, so that six-minute rendition was unnecessary.”

“So, board members, I’ll use the next 23 minutes to help us focus on our agreed-upon top priority this year—the XYZ Project. Meet in groups of two or three for eight minutes and then report back on the discussion question written on our white board.”

I know. I know. This might cross the line from good governance to picky governance. But…you get the point. Ephesians 5:15-16 reads, “Therefore be careful how you walk, not as unwise men but as wise, making the most of your time, because the days are evil” (NASB).

Named by ESPN as the Greatest Coach of the Twentieth Century, UCLA Basketball Coach John Wooden said it simply, “Time lost is time lost. It’s gone forever.”

BOARD DISCUSSION: At the end of your next board meeting, read this tongue-in-check blog to the board and then ask for feedback. Did we steward our time well today? How did we measure up to John Wesley’s aspiration? "I value all things only by the price they shall gain in eternity."

MORE RESOURCES: Follow the “40 Blogs. 40 Wednesdays.” color commentaries on Lessons From the Nonprofit Boardroom. Click here.

Monday, June 11, 2018

Succession Planning: 11 Principles (Index to 11 Blogs)


Note: Below is a click-and-read index to 11 recent blogs featuring practical wisdom from the new ECFA Governance Toolbox Series No. 4: Succession Planning. Free to ECFA members, you can download the resource and video by clicking here.

But…before you click and read below, note this one last insight from the international bestseller, The First 90 Days: Proven Strategies for Getting Up to Speed Faster and Smarter (Updated and Expanded), by Michael Watkins.

“S.T-A.R.S.”
Board members should discern not only what CEO competencies they need for the next few years, but what kind of situation their new leader will inherit. Michael Watkins says there are four broad types of organizational situations—and there are risks. For example, a veteran CEO of a “Sustaining Success” organization may not be effective in a “Turn-Around” opportunity.

Start-up: “Building structures and systems from scratch without a clear framework or boundaries.”
Turn-Around: “Reenergizing demoralized employees and other stakeholders.”
Realignment: “Dealing with deeply ingrained cultural norms that no longer contribute to high performance.”
Sustaining Success: “Playing good defense by avoiding decisions that cause problems.”

OK…now click, read, and review the 11 principles featured in the last 11 blogs. Enjoy!

1) Principle No. 1: Avoid Buses and Boredom! -  “My Heart Had Left the Building”

2) Principle No. 2: Discern Your Board’s Succession Values and Beliefs - “Appointment Without Anointment Always Led to Disaster”

3) Principle No. 3: Inspire Your CEO to Thrive With a God-Honoring Lifestyle – “Is Your CEO Thriving or Just Surviving?”

4) Principle No. 4: Model Successful Succession in the Boardroom First - “’One Size Fits All’ Is Bad Counsel”

5) Principle No. 5: Delegate Succession Planning to the Appropriate Committee – “The Ongoing Continuous Process”

6) Principle No. 6: Invest in Growing Your Leaders (Every Leader Needs a Coach) – “Does Your CEO Need a Coach?”

7) Principle No. 7: Trust God and Discern Direction! Wisdom on Ending Well - “Wise People Know When to Quit”

8) Principle No. 8 - Plan for Plan A: Your CEO Retires - “Do I Still Have Fire in My Belly?”

9) Principle No. 9 - Plan for Plan B: Your CEO Resigns – “The Five Stages of CEO Abandonment”

10) Principle No. 10 - Plan for Plan C: Your CEO Is Terminated – “Hire Slower and Fire Faster”

11) Principle No. 11 – Discern If a Search Firm Would Be Helpful – “Differences Between Search Firms”

BOARD DISCUSSION: List one principle you are well-prepared for. List one principle that needs more attention by the board. Pray and discern!

TO DO TODAY: Download the Facilitator Guide and inspire your executive committee (or governance committee) to review the toolbox materials. Remember: every CEO is an Interim CEO! 

DOWNLOADECFA Governance Toolbox Series No. 4: Succession Planning – 11 Principles for Successful Successions: “Every CEO is an Interim CEO.” The toolbox includes 
   • Read-and-Engage Viewing Guide (20 pages) – photocopy for board members
   • Facilitator Guide (10 pages)
   • 4 short videos (4-5 minutes each)
   • Additional resources and succession planning tools

MORE RESOURCES: Follow the “40 Blogs. 40 Wednesdays.” color commentaries on Lessons From the Nonprofit BoardroomClick here.

Friday, June 1, 2018

Succession Planning: Decide If You Need a Search Firm


Note:
 This is the eleventh (and final) blog of 11 blogs featuring practical wisdom from the new ECFA Governance Toolbox Series No. 4: Succession Planning. Free to ECFA members, you can download the resource and video by clicking here.


Principle No. 11 - Discern If a Search Firm Would Be Helpful

The toolbox materials list three options for conducting a CEO search:

   • Option #1: Retain a Search Firm
   • Option #2: Retain a Consultant/Coach
   • Option #3: Conduct Your Own Search

But heed this warning from the authors of You’re Not the Person I Hired!—a very helpful resource: “When you are tempted to rush a hire, think in terms of Return on Investment over the course of years, not months.”

Boards of larger organizations that rely on retained search firms for senior level positions will often engage a firm to conduct their CEO search. Just as organizations have unique cultures and methodologies, so retained search firms will have unique approaches for your important search. Interview at least three firms.

In his article, “Differences Between Search Firms,” Bruce Dingman suggests that the firm selected should find at least four candidates to be considered. His article outlines other factors to consider:
   • Ethical issues and “out-of-bounds” and “off-limits” industry practices
   • Reputation of the firm versus the recruiter
   • References of the recruiter
   • Pros and cons of specialists versus generalists
   • Speed versus quality
   • Cautions about saving time with a recruiter’s “short list”
   • Importance of pre-recommendation reference checking
   • Recruiters’ experience with search committees

As your board reviews the resources in the toolbox, don’t skip the spiritual discernment process—which takes time. And time is a significant issue for busy board members. But note this counsel from Michael J. Lotito: “If you spend a lot of time figuring out who you’re going to hire, you’ll have to spend far less time figuring out who to fire.”  

BOARD DISCUSSION: When our CEO exits (Plan A, Plan B, or Plan C), are we confident that we will make the search firm decision (see the three options above) based on God’s leading and our mission and vision? Or will our budget parameters push us in the least desirable direction? 

TO DO TODAY: Download the Facilitator Guide and inspire a board member to review the numerous resources, books, and articles on selecting a search firm and interviewing candidates.

DOWNLOADECFA Governance Toolbox Series No. 4: Succession Planning – 11 Principles for Successful Successions: “Every CEO is an Interim CEO.” The toolbox includes 
   • Read-and-Engage Viewing Guide (20 pages) – photocopy for board members
   • Facilitator Guide (10 pages)
   • 4 short videos (4-5 minutes each)
   • Additional resources and succession planning tools

MORE RESOURCES: Follow the “40 Blogs. 40 Wednesdays.” color commentaries on Lessons From the Nonprofit BoardroomClick here.

Thursday, May 24, 2018

Succession Planning: Hire Slower and Fire Faster



Note:
 This is the tenth of 11 blogs featuring practical wisdom from the new ECFA Governance Toolbox Series No. 4: Succession Planning. Free to ECFA members, you can download the resource and video by clicking here.


Principle No. 10 - Plan for Plan C: Your CEO Is Terminated

What do board members fear the most? They fear having to terminate a CEO on their watch. The common wisdom is “Hire slower, fire faster.” But few follow this counsel in nonprofit organizations. Even fewer in nonprofit ministries.


We want grace to abound. We serve the God of second chances (third, fourth, and fifth chances!). But the day may come—for any number of reasons—when you’ll need to terminate your CEO. And here’s the problem: there’s no board member course on “7 Principles for Exiting Your CEO.” (Who would sign up for that one?)

The board’s most important role is to ensure that they have the right CEO in place. Ram Charan emphasizes this in Owning Up: The 14 Questions Every Board Member Needs to Ask:


“There is nothing more important for a CEO than having the right strategy
and right choice of goals, and for the board, the right strategy
is second only to having the right CEO.”

When it’s time for a CEO to exit, it’s time for board members to execute their fiduciary and spiritual duty. No one, except the board, has this God-given stewardship responsibility.

BOARD DISCUSSION: “Never hire anyone you can’t fire,” warns Donald Rumsfeld in his treasure chest of wisdom, Rumsfeld's Rules. At your next board meeting—with the CEO in the room—have a frank discussion about what conditions might be present that would require the board to exit the CEO. Ensure that the discussion is healthy and helpful.

Sometimes the lack of humility in a CEO is mentioned as one of the contributing factors (or is a foundational character flaw) that causes boards to terminate a CEO. For preventative work on this issue, read the blogpost, “Serve With Humility and Experience God’s Presence,” and Patrick Lencioni’s insights in The Ideal Team Player: How to Recognize and Cultivate the Three Essential Virtues. (Guess what? Humility is one of the three virtues.)

TO DO TODAY: Download the Facilitator Guide and inspire a board member to review the helpful checklists for “Plan C.” Remember: every CEO is an Interim CEO. 

DOWNLOADECFA Governance Toolbox Series No. 4: Succession Planning – 11 Principles for Successful Successions: “Every CEO is an Interim CEO.” The toolbox includes 
   • Read-and-Engage Viewing Guide (20 pages) – photocopy for board members
   • Facilitator Guide (10 pages)
   • 4 short videos (4-5 minutes each)
   • Additional resources and succession planning tools

MORE RESOURCES: Follow the “40 Blogs. 40 Wednesdays.” color commentaries on Lessons From the Nonprofit BoardroomClick here.

Thursday, May 17, 2018

Succession Planning: The Five Stages of CEO Abandonment



Note:
 This is the ninth of 11 blogs featuring practical wisdom from the new ECFA Governance Toolbox Series No. 4: Succession Planning. Free to ECFA members, you can download the resource and video by clicking here.


Principle No. 9 - Plan for Plan B: Your CEO Resigns

Surprise…and maybe shock! While you thought your CEO would serve until retirement, today she called your board chair to announce her resignation! 


CEOs exit for many reasons:
• God’s call to another ministry
• Transition back to a previous career or organization
• Burnout or boredom
Lack of passion
• Illness or family challenges
• Geographical and/or weather preferences
• “Pounding the same nail” one too many years
• Out of alignment with the board’s vision
• Failure or position mismatch
• Theological disagreements

You likely have other reasons to add to this list.

Boards will often have a sense of abandonment. The timing is rarely perfect. Some board members will experience one or more of the five stages of loss and grief popularized by Elisabeth Kübler-Ross: Denial and Isolation, Anger, Bargaining, Depression, and Acceptance.

As you’re negotiating this transition, heed the counsel from author William Bridges, who notes that “the beginning of wisdom is to call things by their right names.” He lists three phases of managing a transition: the ending, the neutral zone, and the new beginning. 

Boards will be alert to these phases during a CEO succession process. For more, read Managing Transitions: Making the Most of Change, by William Bridges, and read my blog post, “Beware the Emotional Effects of Transition,” about the 22 emotions that your board might experience along the continuum—from denial to enthusiasm.

Warning and Reminder! How boards and CEOs negotiate the delicate dance of honoring each other will be observed by staff, volunteers, stakeholders, givers, and the community. (Not to mention your next CEO recruit!) What an opportunity to be God-honoring!

BOARD DISCUSSION: True or False?
1. We have board-approved policies that address CEO succession.
2. As a board, we are experienced at spiritually discerning God’s voice—and we will not need to learn this competency in the middle of a crisis.

TO DO TODAY:
Download the Facilitator Guide and inspire a board member to address how you’ll respond to a “Plan B” scenario. Remember: every CEO is an Interim CEO. 

DOWNLOADECFA Governance Toolbox Series No. 4: Succession Planning – 11 Principles for Successful Successions: “Every CEO is an Interim CEO.” The toolbox includes 
   • Read-and-Engage Viewing Guide (20 pages) – photocopy for board members
   • Facilitator Guide (10 pages)
   • 4 short videos (4-5 minutes each)
   • Additional resources and succession planning tools

MORE RESOURCES: Follow the “40 Blogs. 40 Wednesdays.” color commentaries on Lessons From the Nonprofit BoardroomClick here.

Thursday, May 10, 2018

Succession Planning: “Do I Still Have Fire in My Belly?”


Note:
 This is the eighth of 11 blogs featuring practical wisdom from the new ECFA Governance Toolbox Series No. 4: Succession Planning. Free to ECFA members, you can download the resource and video by clicking here.


Principle No. 8 - Plan for Plan A: Your CEO Retires

News Flash! Your CEO will retire someday, as will the senior leaders reporting to the CEO. Healthy boards and healthy CEOs address these facts of life well in advance. Effective boards take time for prayer, discernment, and considering God-honoring options. The toolbox resources for “Plan for Plan A” include helpful questions so boards and CEOs can address the elephant in the room. 

Example:
“We have clear expectations and written annual goals (with annual performance reviews) for our CEO to prevent ‘coasting’ into retirement.”
• “Our CEO already has a healthy and balanced life outside of work so retirement will not be a shock to the system.”

Even if your current CEO is relatively young, effective boards help CEOs plan for their inevitable retirement. David McKenna counsels, "Succession begins before we assume a position of leadership, not when we get ready to leave it.”

In the next two blogs, we’ll discuss Plan B—your CEO resigns, and Plan C—your CEO is terminated. Given three choices, Plan A is a joy to address!

When should a CEO retire or resign? McKenna says “timing is everything” when discerning when to leave a ministry. CEOs should ask themselves, “Do I still have fire in my belly for the future of this organization?”

In The Leader’s Legacy, McKenna notes three questions from Peter Drucker:
   • What needs to be done?
   • Can I do it?
   • Do I want to do it?

Download the Facilitator Guide and inspire a board member to address this common elephant in the room at your next board meeting. Remember: every CEO is an Interim CEO. 

BOARD DISCUSSION: One retirement option for your CEO might be to launch a second part-time career (consulting, teaching, writing, etc.). Would our board be open to our CEO beginning what Bob Buford, author of Halftime, labeled “low-cost probes” into a new venture while still employed here?

DOWNLOADECFA Governance Toolbox Series No. 4: Succession Planning – 11 Principles for Successful Successions: “Every CEO is an Interim CEO.” The toolbox includes 
   • Read-and-Engage Viewing Guide (20 pages) – photocopy for board members
   • Facilitator Guide (10 pages)
   • 4 short videos (4-5 minutes each)
   • Additional resources and succession planning tools

MORE RESOURCES: Follow the “40 Blogs. 40 Wednesdays.” color commentaries on Lessons From the Nonprofit BoardroomClick here.