3 Fundamentals for More Effective Boards

Board members and CEO’s often acknowledge weaknesses or risks with their NFP Boards yet are unsure how to tackle these issues or identify how to begin a development process.

This can leave your organisation exposed to an absence of strategic leadership including poor decision making and inadequate management of risk.

This article outlines a way to evaluate your Board effectiveness.

The 3P’s -  A Board evaluation framework

You can use a simple and holistic tool to help gauge current performance of your Board and identify improvement opportunities. The tool comprises 3 perspectives on effectiveness; Purpose, Process & People.

These are like windows through which your current situation can be seen and compared to good Board practice.

Let's look at your Board's effectiveness through this framework and understand where gaps or weaknesses may exist.

1. Purpose

Through the first window, look at clarity of purpose. 

Consider through the eyes of a Board member the level of common understanding and acceptance of their leadership role, the strategic priorities and how well your organization is performing against those.

Questions of your Board

• How clear are the roles and goals of the Board?
• What level of alignment and ownership exists toward organisational purpose, goals and priorities?
• How often is performance toward purpose and strategic priorities measured & reviewed?

From work with over 30 NFP Boards these trends have been observed. There is often..

• Strong recall and ownership of the vision and mission
• Much weaker alignment and understanding of strategic priorities
• Limited use of strategic measures to regularly monitor progress toward purpose and priorities
• Varied understanding of the role of a Board member

2. Process/ Policy

In the second window, look at the disciplines and habits the Board uses to do its work.

Key processes include conduct of meetings, information and communication flows, decision making, boundary management and risk management. These activities are ideally guided by policy frameworks or effective routines.

Questions of your Board

• Which group activities are guided by effective processes and which are not?
• Which processes could be improved to drive more effective action?
• How effective are the decision making routines of the Board?

 When contrasting your Board with others, you might notice some similarities, such as;

• Meetings that waste time and fail to deliver on the Board’s strategic leadership role
• Hazy boundaries between Board and CEO matters; many Boards are too involved in operations
• Loosely managed risk management processes
• Indecision or caution because of the lack of rigour around risk
• Under prepared or ill informed board members at meetings
• Ineffective communication or delegations between sub-committees/ branches and the Board

3. People

Through the third window, look at the dynamics, behaviours & engagement of Board members.

Effective Boards have the right culture, capability and composition that support useful behaviours.

Questions of your Board

• What level of robust debate and trust exists so that all issues are aired prior to decision making?
• To what extent does your group have the capabilities required to perform effectively?
• What strategies are in place to ensure you have the best people for the job?

Given that most Boards of NFP’s comprise volunteers, these patterns have been observed;

• Enormous goodwill and commitment to organisational success
• Reluctance to engage in robust debate about tough issues; a preference to be ‘nice’ to others
• Passionate people who have capability gaps; so the weaknesses are recognised but not addressed
• Being grateful but not strategic in attracting new Board members or planning for succession

Call to Action

Perhaps one or more of these questions raises pertinent issues for your Board.

So how do you make a start in addressing them?

The questions in this article can be used to initiate a discussion with your Board about their effectiveness. Based on their appetite for improvement a more comprehensive Board Evaluation could then be undertaken. There are essentially 2 levels of Board Evaluation to consider

Self diagnosis

• This approach has the benefit of being cost effective, but lacks impartial and professional guidance.
• Like self diagnosing an illness, its usefulness might depend on how sick the patient seems to be
• The full version of the 3P’s Board Evaluation Framework provides one practical tool for self assessment. Once the 3P’s assessment tool is completed by each Board member, the CEO and possible senior staff a compiled version of results can be reviewed and discussed. Common themes can be found and differences in perspective noted, leading to agreed areas that require development.

Professional diagnosis

• Professional guidance will ensure thorough and objective feedback. It will also expedite more efficiently the identification of improvement actions which is when the real value to the Board will be seen
• A professional and experienced Board consultant will have the added benefit of contrasting your current Board approaches to many others, thus enabling a more balanced view

To purchase a copy of the 3P’s Board Self Assessment Tool, Click Here

To speak with someone about professional help, please Contact Us

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by David Pointon - FAST Meetings Co.

FAST Meetings Co. provides professional support to Boards including Board Evaluation, Board Governance Training, Strategy facilitation, Strategy into Action consulting, and Executive Coaching