Thursday, July 17, 2014

Could I Fire You? No Problem!

I was in the last phase of what I call “dating a board prospect.” I had been cultivating Dan’s interest and engagement in the ministry I led for about 18 months.  Dan was also a good friend—but good friends don’t always make good board members.

So over dinner with Dan, and his wife, I’m ready to make the big ask—would he be open to serving on our board, if the Nominating Committee recommended him to the board?

Good news: Dan was willing to serve.

More good news: Dan’s wife affirmed his passion for the ministry.

“One last question, Dan.” I paused to be sure he would take time to think about it.

“We’re good friends. But it would be important to me that, if needed, in extenuating circumstances, the board had to fire me…”

Clearly, I was moving too slow for Dan and he didn’t even wait for me to finish my sentence, which would have been, “…if the board had to fire me, could you do that, irrespective of our friendship?”

As I said, Dan interrupted me half-way through my monologue: 
“Could I fire you, John?
No problem!”

I laughed. He laughed. And all was well.

One of more than 400 “
Rumsfeld Rules,” penned or borrowed by Donald Rumsfeld, reads:

“Never hire anyone
you can’t fire.”

Perhaps we need another rule: “Never recruit a friend to your board who values friendship more than doing the right thing.”

“Most of us are unknowingly selfish when it comes to friendship,” say Jerry and Mary White in their new book, To Be a Friend: Building Deep and Lasting Relationships. In their chapter on “Virtuous Friendship,” they pose an excellent discussion question: “[Discuss] the instances in which you have practiced virtuous friendship or been the recipient of a virtuous friendship.”

Should board members and CEOs invite close friends to serve with them on a ministry board?  I can’t answer that for you—but a virtuous, God-honoring friendship should be able to handle board work.  Certainly many acquaintances over the years have become close friends—as a result of the joys and turmoil of board service.

My response: No problem!

QUESTION: What are the upsides and downsides of inviting close friends to serve with you on a board of directors?

Thursday, July 10, 2014

85 Governance Questions and 85 Answers

Just when you think you have a handle on God-honoring governance, you discover you’ve muddled yourself into a lose/lose dilemma:

   • A board member doesn’t recognize a messy conflict of interest.
   • The CEO and senior team are encroaching on the board’s role.
   • The board is meddling and micromanaging in the staff’s role.
   • Neither the board nor the CEO is focused on governance.
   • (Add your issue here.)

What to do?  Sometimes, just knowing that other boards have experienced similar issues is therapeutic. So I recommend you surf through the 85 questions and answers in the 363-page resource, The Nonprofit Board Answer Book: A Practical Guide for Board Members and Chief Executives (Third Edition), published by BoardSource.

Suggestion: bring the book to every board meeting—and pass it around the room.
It will be irresistible to your board members
in their search for proof texts!

When you scan the table of contents, dozens of relevant questions will jump off the page—and tempt you to read the crisp, well-written two- to four-page answers. While this is not a faith-based book the first edition was written by Ted Engstrom and Bob Andringa, evangelical Christian leaders who have mentored hundreds of Christian leaders in effective governance.

The 85 questions and answers are organized into seven sections:
   1. Basic Board Functions
   2. Board Structure
   3. Board Member Selection and Development
   4. Board and Committee Meetings
   5. The Board’s Role as a Fiduciary
   6. Board-Staff Relations
   7. Organizational Change

As you leverage the insights of this book, challenge your board members to then ask the next question: “Do we need to add anything to this answer that would more specifically speak to the core values of Christ-centered governance?” For example, "While competent in decision-making, are we also competent in spiritually discerning God’s direction for our future?"

QUESTION: What are the Top-3 sticky issues your board is facing—and does The Nonprofit Board Answer Book provide any answers?

Tuesday, June 24, 2014

3 Mantras to Ban from the Boardroom

“Make the lie big, make it simple, keep saying it, and eventually they will believe it.”

Variations of this idea have been attributed to numerous leaders across history (none of them admired today).  Yet I’ve noticed a tendency—even in Christ-centered organizations—to repeat, repeat and repeat various mantras. After time, most people have bought in—even if the mantras or axioms are not even biblical. Examples:

#1. The Three W’s: Work, Wisdom and Wealth.  This one suggests that a board member is doing well if he or she contributes just one of the three W’s: work, wisdom or wealth. Where’s that in your Bible?  

John Frank, author of the quick-reading 55-page book, Stewardship as a Lifestyle: Seeking to Live as a Steward and Disciple, explains it this way:

“Some may believe that if you give time as a volunteer then you do not need to be a financial donor to the organization.  While all gifts of time, leadership and volunteering are appreciated, there is no measurement system in scripture to allow a gift of one type to cancel the need to grow in one’s holistic stewardship.”

#2. Ask the Busiest People to Serve—They Get Stuff Done.  This mantra must be banned from the boardroom!  Increasingly, many boards are finding that the busiest people are too busy.  They don’t: attend board meetings consistently, do the homework, engage deeply as stewards of God’s work, or—ahem—answer their emails. 
Is Not Godliness!

My personal pattern is not prescriptive for anyone else—but I limit my board service to just one board at a time. Others serve on only two boards. Maybe in full retirement a gifted person can serve on three or more boards—but calendar conflicts will be inevitable. Board service must be a faith trip, not an ego trip.

#3. We Don’t Need an Annual Board Self-Assessment Survey. The ingredients for this common myth are part ego, part arrogance, and part negligence.  Skipping an opportunity for every board member to weigh-in on board effectiveness is short-sighted.  At best, perhaps the board is too busy with non-essentials. At worst, perhaps the board is not open to a discernment process when the Lord can speak into areas of Christ-centered governance that need improvement.

Peter Drucker wrote, “Self-assessment is the first action requirement of leadership: the constant resharpening, constant refocusing, never really being satisfied.” 

QUESTION: What other board mantras are you living by, perhaps unintentionally, that are neither biblical nor healthy?

Friday, June 20, 2014

Board Angst Over Symptoms Versus Diseases

The CEO in the back of the workshop room shared a painful problem:

“I have several long-term board members who ignore our term limits and creatively manipulate our nominating process so they can stay on the board. They don’t trust me or the next generation—they’re just stubbornly hanging on.”

“So here’s my question,” he continued. “Could a consultant help us deal with this?”

I was about to help this CEO with my standard term-limits speech—but the Lord nudged me. I paused and prayed silently.  These are the simple words the Holy Spirit put to voice:

“You don’t need a consultant.
You need a pastor.”

All board work is messy.  Governance in Christ-centered organizations is even more challenging. We have high expectations. We expect board members to do the right thing, with the right motivation—always in a God-honoring way.

Yet, we’re sinful.

In addition, too often, we have angst (and even verbal fist fights) over symptoms—and never get to the disease. If you ask the wrong question, you’ll get the wrong answer.

Symptom: Unexcused absences prompt more attendance rules.
Disease: Lack of board member engagement is actually due to the absence of compelling agenda issues to address. A board member wonders, “Why am I needed?”

Symptom: Micro-managing board members.
Disease: A dysfunctional focus on tactics versus strategy. No agreement on the ministry’s mission, vision and core values. No strategic planning process.

Symptom: Never enough money.
Disease: No spiritual discernment process. The board approves CEO plans that are based on what The Choice describes as “the common path” versus the “kingdom path.” The organization is over-committed, not under-funded.

You get the idea. Do you need a consultant or a pastor? You must move past the symptoms and address the disease. Or as Max De Pree, former chairman and CEO of Herman Miller, and a seminary board chair, wrote,
“The first responsibility of a leader
is to define reality.”

QUESTION: What are the three biggest challenges your board is now facing? Are you addressing the symptoms or the disease? How are you defining reality?

Thursday, June 12, 2014

The Nominating Committee’s Gong Show!

If you’re old enough to have watched TV from 1976 to 1978, you’ll remember the infamous “Gong Show.”

Any one of three celebrity judges had the option of whacking a gong if the amateur performers (often with dubious talent) were particularly bad.

A recent question about the board recruitment process struck an old nerve with me—and now I’m thinking that nominating committees should bring back the gong!

Play along with me.  Your nominating committee is meeting—and various names and credentials are being suggested.  What if…you brought a big gong to the meeting and you gave veto power to every committee member? All opposed—whack the gong!

It would sound like this:

[  ] “I’d like to nominate Mr. Washington. I don’t know him, but he’s a friend of a friend of my Cousin Eddie.”  GONG!

[  ] “I don’t think Pedro Martinez has been involved with our ministry—but he’s on the City Council and his resume would look great on our website.”  GONG!

[  ] “I apologize that we’re meeting so late in the process. Since our board meeting is tomorrow, I’m proposing that we nominate Olga Olensky and skip the reference checking phase. She’s been a member at First Community Church for years. I’m confident the new pastor there would give her a good recommendation.”  GONG!

[  ] “You’ll recall that Phillip Chen was a visitor at our last board meeting. He’s willing to join the board, but his schedule will prevent him from attending half of our board meetings this year. But he’s a major donor.”  GONG!

You get the idea.  (Maybe you’ve already googled, “purchase mallets and gong.” Note: Amazon sells them.)

Of course, you know that there’s a better, more God-honoring way to do board recruitment. The best practices of many Christ-centered boards are included in the ECFA Governance Toolbox Series No. 1: Recruiting Board Members.  The 12-minute video and read-and-engage viewing guides will walk your nominating committee through four very thoughtful next steps—guided by a foundational spiritual discernment process.

By the way, it's a good thing there were no gongs available when we were recruited to the board, right?

QUESTION: Does your board require the same level of spiritual discernment and due diligence when recruiting board members—as you expect your CEO to do when recruiting senior team staff members? 

Thursday, June 5, 2014

The Dreaded CEO Report

Over coffee with a church board chair last year, I heard a common theme.

“At elder meetings, I give our pastor 15 minutes to share his heart. In my mind, that’s a gift to him. He could use that time to inspire our leaders, to focus on the future, to talk about trends, and so much more.

“But, no.  He squanders that 15 minutes for B-Priority reporting: The youth pastor is sick, the roof was repaired, a new van is on order, etc.”

I hear this often. When the board agenda calls for the senior pastor or CEO to give a verbal report, the result is often too long, uninteresting, or even tedious. Worse: in those rare cases where a CEO sends a polished written report—in advance of the meeting—sometimes that written report is read, verbatim, at the meeting.

What’s the fix for the dreaded CEO report? Three thoughts:

First, boards must specify the level of reporting they expect from the CEO. If you use a Board Policies Manual (BPM), the type and frequency of CEO reports should be detailed there. Perhaps start with a “CEO’s Monthly Report to the Board” template—and get buy-in for what should be included. (For a sample template, click here and scroll to the bottom of the "Board Bucket" webpage.)

Second, it’s possible that your CEO (or senior pastor) needs some gentle coaching. Perhaps he or she has not served on other boards or observed an effective board report by a CEO. So re-visit the purpose and responsibilities of the board—and the opportunity the CEO has to help and inspire the board to do their work well. Identify what the board needs—and doesn’t need—during the CEO reporting time.

Allocate time at your next board meeting to talk about this.  (And reminder: you have all
four social styles around the board table—Drivers, Analyticals, Amiables, and Expressives—so the CEO report should include something for all four styles, not just the CEO’s style.)

Finally, CEOs of Christ-centered organizations, must (let’s boldface that: MUST) inspire the board to see their work from an eternal perspective.
If CEOs focus on the nuts and bolts—and what happened yesterday—
instead of God’s voice and God’s plan,
the reporting process will never inspire.

In the profound book, The Choice: The Christ-Centered Pursuit of Kingdom Outcomes, by Gary G. Hoag, R. Scott Rodin, and Wesley K. Willmer, the authors suggest we study “five traits that flow from defining success in terms of obedience to the teachings of Jesus”—the kingdom path (versus the “common path”). The five traits include: Steward Leadership, Faithfulness-Focused Strategies, Eternity-Oriented Metrics, Relationship-Based Management, and a Stewardship View of Resources.  

Imagine a robust discussion—led by the CEO—on one of these five traits at every board meeting!  That’s a board meeting I’d like to attend!

QUESTION: How will your CEO and board members find common ground on CEO reporting so the “dreaded CEO report” becomes the “inspiring CEO report?”

Saturday, May 31, 2014

Board Meeting Rules of Thumb: Subtle Signs of Slippage

This month, while traveling out of state, I had an unplanned two-night hospital stay. The flat-on-my-back position tends to activate the philosopher in me.  So I focused on equal doses of the three P’s: Pain, Prayer and Philosophizing. 

My best philosophizing moment occurred after check-out—at the airport—as I reflected on the sum total of my hospital experience. Here’s what happened:

In between needle pokes and IVs, I asked my nurse for a pen and paper. The hospital pen, complete with name, website and logo, did its work at first.  But two days later at the airport, I pulled the pen from my navy blazer pocket—and presto!—the pen tumbled to the floor in four pieces.

Thus my epiphany:  “Yikes!” I mumbled to myself, “If cheap pens are standard issue—what else is sub-standard at that hospital? IVs? Thermometers? Sanitation? Training? Record-keeping?” My mind went wild.

Then I thought about board meetings and my new rule of thumb:
“There must be ample 'Sturdiness Indicators' to outweigh the subtle signs of slippage." (Quality presentations may not overcome crummy pens.) 

What subtle signs of slippage show up at your board meetings? Here’s a possible list:
   • Typos in the minutes
   • Financial report inaccuracies
   • Inadequate preparation
   • Reliance on anecdotes over data
   • Cosmetic economizing (“We saved a tree by not printing out this report.”)
   • Spiritualizing (“God told me.”)

Next, what dominant signs of sturdiness ooze out of your board work (“Sturdiness Indicators”)?
   • A balanced mix of faith and due diligence
   • Honest reporting (the good news and the bad news)
   • Thoughtful reminders of the board’s role: Steward-Leaders, not Owner-Leaders (per Scott Rodin’s powerful book)
   • What would you add here?

In his classic book, Leadership Is an Art, Max De Pree warns about “impending deterioration.” That’s the slippage issue. De Pree writes that a financial analyst once asked him, “What is one of the most difficult things that you personally need to work on?”  His answer:
“The interception of entropy.”

So…what’s your take-away? Mine: “The pen is mightier than the sword” ain’t necessarily so. 

QUESTION: At the conclusion of your next board meeting, ask each board member for a 60-second around-the-table response to this question: “What did you notice today as a possible subtle sign of slippage—and what would be one ‘Sturdiness Indicator’ that you would affirm?”