Friday, February 28, 2014

Big Egos and Hallway Power Plays

“To recruit new board members because of their position versus their passion.”

This is old school board recruitment:
   • We need a pastor on our board, preferably one from the largest church in our city, state or country.
   • We have legal issues, so who knows an attorney that could be on our board?
   • What about the board chair over at First Community? He’s on six boards and his resume is stunning!
   • Yikes! Our board is too old, too male and too white. We need some diversity.

Memo to All Boards:
Old school board recruitment doesn’t work and never did.
When you recruit board members for position (without their passion), you rarely get loyalty, high commitment, generous giving, or spiritually discerning decisions.  Instead, you’ll frequently get unexcused absences, big egos, lack of unity and hallway power plays.

It doesn’t have to be that way—and it must not be that way.

Board guru Ram Charan writes, “With the right composition, a board can create value; with the wrong or inappropriate composition, it can easily destroy value.” So getting the right people on your board bus is a foundational priority.
How? Your organization has hundreds, if not thousands, of volunteers and highly committed donors. Many of them, if appropriately cultivated over a 12 to 36-month process, would be extraordinary board members.  So don’t settle for a glowing resume from someone you don’t know, who has little knowledge of you, and zero passion for your ministry.

Instead, take time and invest as much energy, due diligence, prayer and spiritual discernment as you would if you were recruiting a new CEO. “As the board goes, so goes the ministry.” For more help, check out the ECFA Governance Toolbox Series No. 1: Recruiting Board Members.

Questions: Who owns the year-round process of cultivating, recruiting, orienting and engaging board members? Is there a spiritual discernment process in place to guide your direction?

Sunday, February 23, 2014

The Train Wreck Waiting to Happen

“To tilt, perhaps by default, toward one of the three unhealthy board scenarios—and miss the extraordinary opportunity to leverage the ‘Governance as Leadership’ model.”

Richard P. Chait, William P. Ryan, and Barbara E. Taylor, co-authors of Governance as Leadership: Reframing the Work of Nonprofit Boards, write that there are three unhealthy governance models:

UNHEALTHY MODEL #1: GOVERNANCE BY FIAT.  In this scenario, trustees displace executives. Here the board does staff work.  Sometimes the staff is incompetent so the board jumps in. Often the board enjoys staff work.  Either way, it’s dysfunctional.

UNHEALTHY MODEL #2: GOVERNANCE BY DEFAULT. Here both the trustees and the nonprofit executives disengage.  No one has their eye on the governance ball—and the important work of governance is minimized.  Left undone, it’s a train wreck waiting to happen.

UNHEALTHY MODEL #3: LEADERSHIP AS GOVERNANCE. This might sound appropriate, but it’s cockeyed.  Here the nonprofit staff displace the trustees.  The CEO and/or senior team make decisions that should be in the governance arena.  This happens frequently with founder-led organizations and “good old boy” boards.  Often, the organization appears to be operating smoothly.  Internally, this dysfunction never ends well. Sooner or later, someone will pay.

So it is possible that your board is seeking to be God-honoring in your stewarding roles, but operating from an unhealthy model—quite likely a model that is not in sync with a Christ-centered foundation? 
While this book is not faith-based,
the big idea aligns beautifully with biblical principles.

TYPE III GOVERNANCE. This fourth scenario, the healthy one, the authors label “Type III Governance.”  Here the trustees and executives collaborate.  They both understand their appropriate roles, but unlike most boards, the staff affirms the board members when they upgrade to “generative thinking.” (My take: governance as leadership maximizes the spiritual gifts of board members per Romans 12, Ephesians 4 and 1 Corinthians 12.)

So what’s “generative thinking?”  The authors use a variety of definitions to explain this cognitive process of excelling boards: sense-making, reflective practice, framing organizations, personal knowledge, etc.  I liked “sensible foolishness” the best.

Generative thinking goes beyond “fiduciary governance” (Type I) and beyond “strategic governance” (Type II).  This “Type III” approach typically involves three steps:
   1) Noticing cues and clues: different people can take the same data and arrive at different meanings;
   2) Choosing and using frames: understanding the “fuzzy front end” of a product development process, for example; and
   3) Thinking retrospectively: the counter-intuitive high value of “dwelling on the past” to understand patterns that might impact the future.

“Generative thinking is essential to governing,” the authors point out. “As long as governing means what most people think it means—setting the goals and direction of an organization and holding management accountable for progress toward these goals—then generative thinking has to be essential to governing. 

"Generative thinking is where goal-setting and direction-setting originate. The contributions boards make to mission-setting, strategy-development, and problem solving certainly shape organizations.  But it is cues and frames, along with retrospective thinking, that enable the sense-making on which these other processes depend.”

Yikes!  Think about this final zinger from the authors: “And a closer examination of nonprofits suggests something else: Although generative work is essential to governing, boards do very little of it.”

Inspire one or more board members to read this book—and report on it at your next board meeting or retreat.

QUESTION: The authors comment, “in their ‘day jobs’ as managers, professionals, or leaders of organizations, trustees routinely rely on generative thinking, so much so they have no need to name it or analyze it. They just do it. But in the boardroom, trustees are at a double disadvantage.  Most boards do not routinely practice generative thinking.”  They add, “When it comes to generative governing, most trustees add too little, too late.” Do you agree?


Saturday, February 8, 2014

Embracing the Loyal Opposition!

Here’s the fourth “board member temptation” on my list:

“To rely on my past board and organizational experiences—and rest on my laurels—versus becoming an active life-long learner in board governance best practices.”

This week I attended a CEO/Board Chair Symposium. I was not a presenter, I was a learner.

I was reminded again how important it is to not rest on our laurels (been there, done that, bought the t-shirt).  Over four days of presentations, I picked up at least a dozen take-aways that inspired me to be a more effective board chair. I walked away with empathy, insights and practical tools.

For example, at the next board meeting I chair, I will mention that our best ideas will be more rigorously vetted when we give permission for board members to play one of four roles:
   • Mover—the person who presents the idea.
   • Followers—the board members who support the action.
   • Loyal Opposition—those analytical and discerning few who ask the tough questions and challenge the mover and followers to think about a wider range of issues and, perhaps, unintended consequences that might result.
   • Framers (or Re-framers)—those insightful board members who take a good idea and make it better, or re-frame it (or customize it) so it fits better with your unique mission and strategy.

The presenter one morning, Nilofer Merchant, also challenged us about the importance of listening to the questions that are being asked. (During an exercise at our workshop table, most of us confessed that we were very ineffective listeners. It was embarrassing!)

Now, rather than the majority of board members grimacing at the nay-sayers, I hope we’ll create a culture of embracing and encouraging them—and blessing them for being the Loyal Opposition. (And isn’t “Loyal” such a perfect word for the tone we’d like to create in our board meetings?)

That was just one of a dozen ideas and tools I picked up as part of my own commitment to life-long learning as a board member.

The Apostle Paul embraces life-long learning when he writes in 2 Timothy 2:2 (TLB), “For you must teach others those things you and many others have heard me speak about. Teach these great truths to trustworthy men who will, in turn, pass them on to others.”

QUESTION: How are you inspiring your board members to be life-long learners? Magazine subscriptions, BoardSource membership, webinars, books, articles, “Ten Minutes for Governance” at each of your meetings, or engaging your board with the ECFA Governance Toolbox Series?