A common misconception of nonprofit governance is that it’s not to be taken seriously. After all, it’s a volunteer position that doesn’t require training, right?
Wrong.
Unfortunately, this attitude is all too common among board members. And it’s this attitude that contributes plenty to board dysfunction. The solution? Good governance and innovation.
Causes of Board Dysfunction
Board dysfunction is by no means fueled by ill will or poor intentions. Rather, when board members are untrained or unaware, there is a huge danger of not making the organization’s best decisions.
And therefore, they get caught up in issues that are not related to why they’re there. Further complicating the matter is that nonprofits also tend to forget that their overall responsibility is to guide their volunteers and their organization to ensure future sustainability. It’s easy to get caught in the weeds, the things that are right in front of you. It’s unavoidable. Equally as important is to be strategic and think outside of the organization. Many boards forget to do this.
Governance Responsibility
Although it’s a very interesting and fine line, ultimately, it’s the board’s responsibility to think about governance, oversight, strategy, and advising the big picture. However, because boards either forget or don’t know this is their role, they instead put on their manager’s hats and manage. Ideally, the CEO, general manager, or executive director should be managing the organization under the guidance and advice of the board.
Think of it this way – the board is the volunteer, and the governance is leadership. Yes, there’s a certain community leadership that the board needs to be thinking about. Still, the staff leadership management and operation leadership is always a staff role (i.e., the Executive Director). There must be a balance between the two because it is a partnership. Without clarifying whose role is what, lines can get very messy.
Risks of The Board Being Too Involved
We’re often asked why it’s a bad thing if board members are too hands-on. After all, why not get more help, especially if you have a solid board. The issue lies in the episodic nature of board meetings. When a board only meets once a month, or even once a quarter, the members are not aware of the day-to-day complications of the organization. They don’t understand the operations necessary to be making the decision. In other words, they could be totally off the mark, wasting precious resources and depleting budgets. There’s always a risk when a board member takes on a particular project and does it in isolation. There always needs to be a healthy conversation between staff and the board.
The Secret Sauce to Innovation
If you want to drive innovation in your organization, you need governance. It’s very important. Your organizational code of conduct should ensure that all board members are on the same page and work well together towards the same goal. Having a board that “dances” well together provides the foundation for creativity and innovation. Before the great ideas start flying, though, the board needs to have a foundational knowledge of the organization: what it’s about, what it needs, where it’s going, and what the board’s role is in the strategic direction. It requires a solid culture that supports core values. Otherwise, the board is just going through the motions. So much board member time is spent reading reports and doing the oversight. There’s very little time spent talking about ideas or brainstorming or strategy. Or examining where the organization currently is. And even if they are, it’s often at the end of the meeting, when members are tired, bored, and want to go home. As a result, those big decisions are often delayed for months and months and months.
How To Encourage Innovation
To be innovative and agile, boards need to change the way they meet, for example, sending reports before the meeting and requiring everyone to read them beforehand, and allowing discussion during sessions only if there’s a question.
This different mindset regarding how a board is run may be one of the biggest obstacles because why change anything if it’s the way it’s always been done. People meet, read reports, carry out motions, and go home. Right?
No. When you free up time spent bogged down in motions and reports, you free up time for ideas, strategies, and setting directions.
It will take some key players to make this change happen, with the drive for innovation often coming from the top. If you are primarily a working board with minimal staff, then this is likely the executive committee of your board (the Board President, Chair, or Vice-Chair). The Board Chair, overseeing the meeting agenda, has a tremendous amount of power to set the tone of the meeting and encourage a change of behaviors and attitudes. There must be a culture of communication, discussion, dialogue, and consultation. The collective wisdom of the organization needs to be activated. Never underestimate the power of group thinking. There’s something magical in its energy and what can be created.
To borrow from Peter Drucker, “Culture will eat strategy for lunch, or breakfast, or all three meals, you know.” Never underestimate the importance of culture; always pay attention to whether your core values mirror what you are trying to do, and finally, how people behave. Encouraging innovation by changing how your board meets will take some hard decisions.
How To Recruit for Innovation
Unfortunately, it’s common for people to have bad board experiences, often due to dysfunction. “It was really, really bad,” “We didn’t do very much,” “It was just a waste of time.”
Situations like this make recruiting board members difficult. To give a good board experience, you need to have a good working culture with a great team. To do so, your board members need to be well trained and follow best practices. When they leave, instead of saying they were bored or have other priorities, they’ll say, “I’ve had a great experience on this board. I felt like I was felt like I was valued.” There need to be some tangible and intangible benefits for the board member, such as the opportunity to work in a group towards something for the greater good or, the larger interests of the profession. You want to create an alignment between the members’ interests, expectations, and what the organization needs.
Steps to Improve Your Governance
The first thing I always recommend is instituting a board orientation and training right off the bat, making sure the processes are supported for long-term organizational sustainability. Second, there needs to be an alignment between where the organization is going, its mission, and its strategies for achieving that mission. Without this, the government will not work as well as it needs to. Third, the board needs to think about where the organization is going, put on their captain’s hats, and then steer it in that direction. This can be a challenge, especially when the board is growing, or they must make a shift between a working board and a tactical policy board that guides future actions.
In closing, to create the perfect secret sauce for innovation and a well-run exceptional nonprofit that makes the difference you want to make, you need a few key ingredients:
- Board member training and orientation to make sure all members are well-equipped on the ins and outs of the organization, how it functions, what it does, and what their role in it is
- A close eye kept on the organization’s mission and impact
- A solid strategic plan that focuses on the future
- Regular project status check-ins: How well did we do? What did we learn? What do we need to do differently?
If you would like to talk to Christina more about the important role good governance plays in innovation, or for more information about our courses, consulting, or coaching, don’t hesitate to get in touch with us here or follow us on LinkedIn.