Why The Boardroom Is Where Great Associations Thrive And Bad Ones Go To Die!
This article was written by Paul Varian. Paul Varian is the President of Capitis Consulting Inc., a specialist not-for-profit management consultancy providing services in and around the Boardroom. He is a presenter at the 2019 Engaging Associations Forum in Ottawa, Ontario, on July 18th & 19th 2019.
In my line of work, I often get called into Associations in time of crisis. Membership is falling at an alarming rate. The income statement is showing too many figures in brackets. Deadlines are being missed, customer complaints are becoming routine. Everything seems to be a fire-fight, the organization is constantly in reactionary mode, playing ‘catch up’ with it all. Staff are exhausted and demotivated as a result.
Everything is a struggle with no end in sight.
I’m often called in to assess the Association’s operations and find out where things are going wrong. And yes, sometimes there are operational problems or shortcomings. But frequently, when I’ve followed the trail of what is causing problems, I’m not in operations at all. I’m in the Boardroom.
Boards of Directors are necessary evils of any Association. Yes, we know they are needed. But truth be told, most people find them irrelevant to what the Association does, or just plain boring. Much more interesting to focus on that annual convention, member professional development program or exciting advocacy work, right?
Its true that Boardrooms may not be the most compelling places in the world of Association management. But ignore them at your peril! Boards of Directors that are not actively managed, professionally developed and properly held to account by membership can quickly become a hindrance more than a help, that can bring any Association to its knees. Many (if not most) Boards of Directors do not function properly, which leads to meandering un-strategic activities and programs, ineffective or wasteful deployment of operating capital, confused and undermanaged staff and shaky partnerships. You see, your Board of Directors is like the captain of your ship. If there’s no one on the bridge plotting a long term course, watching for pirates or icebergs and
making sure everyone’s doing the job they are supposed to be, sooner or later you will run aground – even if the actual ship is materially in great shape!
Many of the problems that shake out in poor Association management – things like declining membership, receding program enrolment, staff under-capacity, technological inertia or lack of effective partnerships – come from weak leadership in the Boardroom that hampers staff’s ability to build long term value, embrace change (and manage the risk that comes with it), or sometimes just get routine things done!
In no particular order, here’s my list of ten common faults I see in Boardrooms that constantly cascade into operational chaos in Associations – how many do you recognize?
1. Board members ‘representing’ other parties in the Boardroom, rather than the Association itself.
2. Board of Directors trying to manage operations alongside staff, rather than govern above them.
3. Lack of Board unity (especially when Board members don’t agree).
4. Board members making decisions based on personal opinions and ‘loudest voice wins’ as opposed
to objective strategy and risk assessment.
5. Poor chairmanship of Board meetings.
6. An Executive Committee getting in everyone’s way or ‘ghost committees’ that do nothing at all.
7. Lack of induction or ‘onboarding’ of new Board members, when they join the Board.
8. No active, structured performance management and development of the Executive Director.
9. Lackadaisical financial oversight.
10. Poor gathering and use of management information.
I could go on, but I don’t want to sound facetious or unfair to Boards of Directors here. Indeed, a great many Boards and the people who serve on them are good, honest volunteers who are genuinely trying to do the right thing. The problem is often that many Board members simply don’t know what the proper role of the Board of Directors is, or what their responsibilities are as Directors. Why?
Well its simple really. Most have just never been told. So what they do? They try to do what their Board of Directors has done in the past, or just ‘pick it up’ from the more experienced Board members sitting around them. Obviously, this means the wrong behaviour in Boardrooms is just perpetuated by new Board members coming in. They may want to do the right thing. But knowing no different from what has been done in the past, they just feed the monster.
Suffice to say, a Board of Directors that checks many boxes in that list above makes it practically impossible for the Association’s staff to be effective, or in turn, for members to be properly served. Redemption of the Association is nigh impossible unless the Boardroom changes how it operates. Without that change, the Association will become increasing irrelevant to its membership and ultimately curl up and die right – there in the Boardroom.
Great Associations, on the other hand, are driven by strong Boards of Directors. These Boards are focused on big picture items that allow them to empower their staff to constantly add value to their membership, no matter what curve balls of change may be thrown at them. Instead of getting caught up in operational minutia or political quagmires, they remain laser-focused on key long term items, namely:
• What is our Association’s purpose and identity?
• What are our Association’s core values, and how are we upholding them every day?
• How aware are we of our external environment and how is it changing?
• What strategy do we have in place to guide our operational activities over the next number of years?
• How aware we of our Association’s risks and how are we mitigating them?
• How effective is our executive leadership and how well directed, empowered, supported and developed are they?
Great Association Board of Directors don’t try to do their staff’s jobs. They simply make sure they hire the right people, direct and control them through clear strategy and policies, resource and develop them properly so they can do their jobs, then get out of their way.
The result? A vibrant, motivated staff team who will die on the hill for their great Association that they don’t only feel a genuine part of, but also extremely loyal to. Rather than seeing the Boardroom as a problem to get around, or a threat to be wary of, they view their Board of Directors as an ally and partner who can help them and is genuinely on their side. And its easy for this positive relationship to thrive when staff see that they are being treated respectfully, Which means being handed clear, unwavering long term goals to work to, genuine decision-making authority, and proper resources so they can be productive and efficient. It means the hours of productivity that are thrown away in poor Associations playing out the agency theory games of poor Board-staff relations are instead applied to driving member value – creating great needs-driven member programs, forging effective partnerships, developing an industry-advancing annual convention, driving advocacy that changes policy and makes a difference. In response to being treated properly, the Association’s staff step up to the plate and everybody wins.
Yes, on the face of it, Associations that thrive do so on the backs of the quality staff and executive leadership they exhibit. But ask those quality staff what the secret of their success is and they will likely point to their Board of Directors and say ‘we can only do what we do because we have the support and trust of those guys.’ Again, it comes back to the Boardroom. Where bad Associations die. But also where great Associations flourish!
So if we can agree that the health of your Boardroom deeply affects the health of the your Association, let me ask you this. How much are you investing in your Board of Directors to make (or keep) it healthy?
No, really? Can you show me the line item in your annual operating budget that funds routine Board member induction, governance training and Board evaluations? How happy is your Board of Directors and what are they getting out of being there? When was the last time you put the stethoscope to your Board’s chest to see how they are feeling, where their frailties are?
For your Board of Directors to be effective, you must continually invest in it, the same way you must in staff or other volunteers! Don’t just expect your Board members to come to the Boardroom experienced, knowledgeable and ready to go! Build a simple but clear onboarding process and have your Executive Director administer it so new Board members can get familiar immediately with your executive leadership.
Show them your Association’s planning, explain to them what you are working to. Give them context for their early decision-making, while they are still working it all out!
Invest in a short but simple governance education session, that you run every year after your Annual General Meeting for your entire Board of Directors. I don’t care if some of them heard it last year – have them sit through it again! They can’t know their fiduciary responsibilities well enough and doing this session together will help bring the new Board together and avoid making new Board members feel like ‘new kids’ with the Trainee badge on.
Consider some specific leadership support for your President. Assuming they are the Board’s chairperson, they have a hugely important leadership role and aren’t just another Director. Do they know that, and what chairmanship entails? Unless they’ve done the job before, they probably won’t and your Board meetings will always struggle if the chairperson doesn’t have control of things. So give them the support they need!
And heres a big one that’s often overlooked. Make sure you routinely take the stethoscope to your Board members and see how they are feeling. Don’t assume they will actively tell you – they probably never will unless you actually ask. What’s the mood? Are they enjoying their Board service or counting down the days to the end of the term? Remember, not-for-profit Board members are usually volunteers. So what are they getting out of being there? Even if they mumble something to you about ‘giving back’, insist on trying to give them more for their efforts than basic altruistic feel-good vibes. If you can’t pay them, try to give them some professional (or even personal) development through their Board service. Can they say that serving on your Board of Directors is bettering them as a person in some way? Find out what that look like for them and see what you can provide under your Board development budget to help them move to it.
And try to get to a point where you are undertaking routine, annual Board evaluations, ideally through an impartial external party. Move your Board of Directors to think of evaluations not so much as judgmental ‘tests’, but as health checks showing where the Board is effective and where it can improve. Your Board’s approach to being evaluated will be a good health test in its own right. Great Boards embrace evaluations with growth mindsets. Poor Boards are threatened by them and often try to avoid them.
Finally, to the elephant in the Boardroom. Yes I know; this all costs money, time and consumes capacity! But do your Association this favour. Give them this big gift that just keeps on giving! Find space for clear, defined management and development of your Board of Directors in your budget and annual operating activities. Make it a priority, even if it may feel (and maybe be seen) as unnecessary cost for the privileged ‘brass’ at your Association. You know that your Board of Directors is important, really important – essential, in fact, to the long term well-being of your Association. So invest in it and keep it strong!