There Are No Irrational Customers

Here in the U.S., retailers mark the day after Thanksgiving as “Black Friday,” the day (supposedly) when a store’s accountants begin using black ink to note that the company is finally profitable on the year and “in the black.” (There are other definitions.)

So in the rush to open retail stores earlier and earlier on the Friday after Thanksgiving—and beat the fierce competition—some enterprises are planning to open on Thursday.

“It’s what our customer wants,” is the spin. 

Frankly, whether it’s spin or not, it’s an excellent response.  In Peter Drucker’s quick-read book, The Five Most Important Questions You Will Ever Ask About Your Organization, his third question asks, “What does the customer value?”  He writes:

“The question, What do customers value?—what satisfies their needs, wants, and aspirations—is so complicated that it can only be answered by the customers themselves.  And the first rule is that there are no irrational customers. Almost without exception, customers behave rationally in terms of their own realities and their own situation.  Leadership should not even try to guess the answers but should always go to the customers in a systematic quest for those answers.”

As a loved and admired graduate school professor, the father of modern management added, “I practice this. 

Each year I personally telephone
a random sample of 50 or 60 students
who graduated 10 years earlier.

I ask, ‘Looking back, what did we contribute in this school? What is still important to you? What should we do better? What should we stop doing?’ And believe me, the knowledge I gained has had a profound influence.”

Preach it, Peter! Several years ago, in preparation for a senior team/board strategic planning retreat, I asked the participants to read this short Drucker book and to conduct one-on-one interviews with at least two customers of the ministry.  Like Drucker, board members especially affirmed, “the knowledge I gained has had a profound influence.”

You might try that with your board. What could be more important in Christ-centered governance than the board being assured that the ministry knows--and responds to--what the customer values?

QUESTION: What does your customer value—and what is your systematic quest for those answers?








 

Cronies and Admirers Need Not Apply!

I serve on a board that aspires to be a life-long learning board—so our meetings always include a segment, “10 Minutes for Governance.” It’s a quick refresher course on a basic governance principle.  

We focus on one big idea, have a brief discussion, and remind ourselves not to rest on the laurels of last year’s governance insights. Board members volunteer in advance to pick a subject and lead the discussion.

So when I read a recent blog post, What Does a Board Do? by Fred Smith, president of The Gathering, my radar was up.  He answers that question with four “F’s” and he delivered the perfect content for our next 10-minute segment.

Here are Fred’s four F’s:

Friendship: The way I would define a friend as a board member is someone who can tell the truth in love. 

It is not a crony
or an admirer. 

I need a sense of partnership with the board that allows the freedom to tell the truth because we are dedicated to the accomplishment of the same mission.

Focus: What will we not do? I need a board that will keep us all focused on the opportunities that are distinctly ours. 

I believe our unique mission 

will be diluted unless we are ruthless 

in checking ourselves and 

not distracted by many interesting possibilities.

Fidelity: I mean this in two ways. First is financial. Our finances should be completely open and in order. Second, the board is entrusted with the vision. It is relatively easy now for us with The Gathering to stay true to the mission and not wander off, but success or expediency will tempt us to betray that trust. My prayer is that The Lord would dismantle The Gathering before it strays from the mission to serve and not be served.

Foresight: Part of our mission is expanding the vision of others, and the board must be constantly stretching the vision of The Gathering itself. The board must be composed of people who see things from a variety of perspectives and interact with a wide world and not just one culture. We need people who will bring their experience in other disciplines and help us see around the next curve.

Click here to read Fred Smith’s entire blog, What Does a Board Do? 

QUESTION: Of the four areas—Friendship, Focus, Fidelity, Foresight—what are you best at? Where is improvement needed—and what’s your next step?

3 Governance Missteps

The father of modern management, Peter Drucker, wrote a fascinating novel with a memorable title, The Temptation to Do Good.  It’s instructive for every nonprofit CEO and board member.

“The temptation to do good” is on my Top-3 list of governance missteps—those fatal stumbles that may derail even the most well-meaning board members. Here’s the list:

Governance Misstep #1. When launching a new nonprofit ministry, you write your bylaws and incorporate before you spiritually discern your philosophy of ministry and philosophy of governance. 

That’s backwards. You should plan, recruit and then incorporate. Seek counsel first from a strategic planning consultant or a savvy CEO who will walk you through a spiritual discernment and planning process. Next, cultivate and recruit board members whose governance philosophies align with your unique mission and ministry philosophy. (One size doesn’t fit all.) Then, and only then, invite your legal counsel to create incorporation documents that will also align with your God-blessed mission, vision and governance philosophy.

Governance Misstep #2. When recruiting board members to both new and established ministries, you rely on the old adage that board members can pick and choose how they'll be engaged: “Pick One: Wealth, or Wisdom or Work.” 

That’s bad theology and bad practice. You need full engagement from every board member. In the new book, Stewardship as a Lifestyle: Seeking to Live as a Steward and Disciple, John R. Frank points out: “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.”

Jesus reminds us in Matthew 6:21 (NIV), “Where your treasure is, there your heart will be also.” Board members of every economic bracket can prioritize their giving so (as some boards require) your organization is one of every board members’ Top-3 giving priorities each year. (That's not in the Bible, but it's good policy.)

Governance Misstep #3.  When meeting human and spiritual needs, we say yes to every opportunity (“the temptation to do good”)—and we blame God if he doesn’t fund our ill-conceived efforts.

That’s irresponsible. Guided by good governance and a focused mission statement, a ministry must prioritize (and say no frequently) and be results-driven versus activity-driven, or tempted to meet every need.  Priorities are paramount.

Why? According to Michael E. Gerber, 40 percent of all small businesses fail in their first year.  Of those that survive one year, 80 percent fail in the next five years. Only 20 percent that make it past five years are around for 10 years. Yikes! (My guess: the nonprofit failure rate is even higher.)

If your CEO has not read the E-Myth literature (to learn how to grow sustainable organizations), check out my review of The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It. 

May God protect you from governance missteps!

QUESTION: What other governance missteps could be obstacles to accomplishing God’s plan for our ministry?

How to Avoid Obliteration

At an important committee meeting recently, I marveled at how the board chair inspired the participants not with a perfunctory prayer—but with a planning prayer.

Instead of downloading some trite feel-good story from the Internet, this board chair did the hard work and found the perfect thought and prayer on the planning process. It fit the time and place—hand in glove.

In a blog post last year I referenced Richard Kriegbaum’s wonderful book, Leadership Prayers, and the “Prayer for Competence.”  

This board chair also appreciates Kriegbaum’s powerful prayers and launched the meeting with the “Planning” prayer:

“Show me your way for us, God. In all the data, there are patterns I must see.  Among the many indicators, there are wise directions I must choose. By your grace I must peer through the foggy confusion and glimpse the light glimmering far ahead. Help me to choose the right path and head toward the right marker. 

If I am wrong, 

we could be obliterated. 

Guide me.

“Wisdom alone will not automatically make our plans easy to adopt or implement. Inevitably, wise planning will require us to act before it is completely apparent that we need to do so. For most of us, that will be hard to do, and it will be frightening for some. The comfort and security of the present that we worked so hard to create will try to seduce us. Nostalgia for our past will tempt us to stay there. Help me instill a longing for our future the way you see it. Carry us forward, God.

“Help us to let go of the present we worked so hard for, the present we asked you for, so that we may embrace a new and better future. Prepare us to accept some chaos in the short run in order to make things better in the long run, to take resources that could feed our present strengths and current welfare and risk them an uncertain future.

“As the leader, I speak for the future, and I love planning to get there. But this is very painful and threatening for some. Help me use the planning process to bring them along. Give me planning wisdom, God.

“Help us to move fast enough to reach our best future in time for it to matter. But let us move wisely enough that we can all stay together. Our inheritance lies yet ahead. Oh, God, help us claim it. I am looking for your guiding light.

“God of our future, show me your way. Make our plans wise.”

The prayer concludes with this encouragement from Jeremiah 29:11:

“’For I know the plans I have for you,’ says the Lord. 

‘They are plans for good and not for disaster,
to give you a future and a hope.’”

QUESTION: On the planning process continuum between “foggy confusion” (and perhaps obliteration) and God’s guiding light…where is your organization? How actively does your board and senior team spiritually discern God’s direction?

Nice Farewell Dinner, But Where’s My Plaque?

It’s not if your CEO exits some day, but when.

Whether your current CEO is your ministry’s founder with years of faithful service, or just one of a parade of capable CEOs who will serve your organization (5, 10 or 15 years perhaps), CEOs all have one thing in common—unique and differing expectations on how the board says goodbye when that time comes.

Board members also have unique and differing expectations on how to honor an exiting CEO, sometimes based on the circumstances of the departure.  But even in the best of situations, whether for retirement (“Job well done!”) or by God’s sovereign call on the CEO to serve at another ministry (“We’ll miss you—but we bless you!”), I frequently hear from departing CEOs that the farewell event or process rarely rings the bell.

So what’s the problem? Are CEOs’ expectations too high? Is it an ego thing?  Are some board members tone deaf?

Perhaps men and women on those boards have not experienced memorable farewells themselves. “Thanks, Charlie! Here’s a watch. Dessert will be served after we watch this commemorative video my junior high kid put together.”

Once, when debriefing an annual “360” review of their CEO, I asked the executive committee members if they knew the preferred love language of their CEO. They laughed—but then took it very seriously and later discerned how their CEO could sense on-going love and affirmation from the board.  

You’ve likely read Gary Chapman’s books on the five love languages, which include: 1) Words of affirmation, 2) Acts of service, 3) Receiving gifts, 4) Quality time, and 5) Physical touch.

My hunch: a CEO who was less than thrilled with his or her send-off was probably honored in some way by the board, but just with the wrong love language. 

Example: some years back, a retiring CEO with a long and appreciated tenure was duly honored at a large gathering. Glowing tributes filled the program. Yet, months later, he confided to me, 

“John, they didn’t give me a plaque.
Can you believe it? There was no plaque!”

I felt empathy for this faithful solider.  He didn’t serve the cause of Christ to get a plaque, but for him, a plaque would have been the perfect love language.

QUESTION: What is your CEO’s love language—and how do you regularly express appreciation to him or her?

Before We Adjourn…Any Apologies Needed?

What would be on your Top-5 list of “Distinctives of Christ-centered Governance?”

Certainly on my list would be this:

“Every board member faithfully responds
to the Holy Spirit’s nudges and never exits
a board meeting if a relationship is out of whack.”

Whenever Bill Hybels, pastor of Willow Creek Community Church (an ECFA-accredited church) speaks, the room goes quiet.  In his book, The Power of a Whisper: Hearing God. Having the Guts to Respond (read my review), he shares a transparent board story.

At the end of a Willow Creek elders meeting, “in typical fashion the chairman of our board led us in a quick assessment of our demeanor and participation that evening. He asked, ‘Does anybody need to make amends for anything, clarify a point or apologize for a wrongdoing of any kind?’”

Hybels raised his hand—and his credibility—by confessing a playful, but inappropriate comment made earlier to a new elder.  The elder was not offended and knew Bill was joking.

Yet this from Hybels: “I got a subtle flag in my spirit after I made that wisecrack,” he admitted, “so I want to stick with the apology and ask your forgiveness here tonight.”

That’s just one of dozens of gems that eloquently illustrate the book’s title. And for me, that would rank on my Top-5 list of what distinguishes Christ-centered governance from the let’s-just-get-this-meeting-over-with garden variety type of boards.  

The personal transparency that is a Hybels trademark has helped fuel this remarkable leader's effectiveness. As I write this blog, this weekend marks the 38th anniversary of Willow Creek Community Church and his leadership of the global kingdom impact of the church and Willow Creek Association.

QUESTION: If an outside observer evaluated your last board meeting—what would he or she describe as the defining characteristics of your governance? Would they be Christ-centered?

Your Greatest Need: Money or Discernment?

Recently a ministry CEO asked me to suggest 10 options for a pre-retreat reading assignment.  My list ranged from books by Jim Collins to Harvard Business Review articles to a poke-in-the-heart spiritual discernment book.

The board chair and CEO picked the poke-in-the-heart book, Pursuing God’s Will Together: A Discernment Practice for Leadership Groups, by Ruth Haley Barton (read my review here). Board members and senior team members read the book, made notes on a “Read & Review” five-page worksheet, and—get this—brought both their brains and their hearts to the strategic planning retreat.

I trumpeted this book here in July, so if you missed that blog, I urge you to dig deeper as you inspire your board to move from decision-making to discernment. Barton’s book is jam-packed with insight and practical tools to equip boards and leadership teams to hear from God and to do his will. She writes:

“Have you ever been part of a meeting in which people were so tired that they made a decision just so they could go home? Have you ever participated in a decision-making process knowing that you were resorting to ‘sloppy desperation’ just because you were exhausted?”

You’ll appreciate the been there/done that elephant-in-the-room stories—and how a spiritual discernment process can lead you to a healthy culture. Barton will inspire you—and give you tools—for the priority task of discerning your board’s values. Her ten guidelines for “entering into and maintaining a listening posture” are both brilliant and practical. You’ll want to laminate the list and bring it to every meeting. 

Hey, Hank! Read No. 3 again! 

“DO NOT INTERRUPT!” 

Share these listening guidelines at your next board meeting:
2. “Listen to others with your entire self (senses, feelings, intuition, imagination and rational faculties).”
3. “Do not interrupt.”
4. “Pause between speakers to absorb what has been said.”
5. “Do not formulate what you want to say while someone else is speaking.”
9. “Leave space for anyone who may want to speak a first time before speaking a second time yourself.”

The 10 guidelines are listed on page 207 of this remarkable book.

At this recent retreat, I was privileged to facilitate a process with men and women whose hearts were prepared—even hungry—for unity and direction. God honored their hearts’ desires.

QUESTION: What’s the most important need in our ministry right now? Raising money to do our work or discerning what work God wants us to do?