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The Board and The Executive. The Non-Profit Organization (or Not-For-Profit). The Perspectives. Purpose or Mission. What is the purpose of an NFP organization? How is it defined? Why is clarity important ?. The Board of Directors.

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The Board and The Executive

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The Board and The Executive

The Non-Profit Organization

(or Not-For-Profit)

The Perspectives

Learning Point

Purpose or Mission

  • What is the purpose of an NFP organization?

    • How is it defined?

    • Why is clarity important?

Learning Point

The Board of Directors

  • Who is the constituency to which the Board is accountable?

    • Founders

    • Sponsors

    • Members

    • Clients

    • Donors

    • Community

  • How is the board elected?

    • Self perpetuating

    • By some part of the constituency

      • Owners/Sponsors/members

    • Terms

    • Size

Learning Point

The Board Of Directors

  • The board has all responsibility and authority as a whole until it delegates to a committee or a manager.

  • Delegation flows from how the board decides to fulfill its responsibilities.

  • When it delegates responsibility it must also delegate authority.

  • It must retain effective oversight and accountability – this requires independence from management

  • How it does this depends on the nature of the organization.

Learning Point

The Nature of the Organization

  • The Nature of the Organization determines governance style and operating practices

    • Small with founders doing all the work

    • Small with a working board and small staff

    • Larger with a staff but still a working board – a management board

    • Larger with a governing board and strong staff leadership – strategy and policy

    • Two-tiered board

Learning Point

A Continuum of Board Functions

  • Operations The majority of the board’s work is doing functional frontline work as the organization’s volunteers.

  • Management and operations Most board work is managing the operations of the organization but also engages in work in administration or programs.

  • Management The majority of the board’s work is managing the operations of the organization.

  • Governing and management Most board work is focused on strategy and policy, but also includes some high level management functions.

  • Governing All board work is focused on the strategic, long-term direction of the organization, including external scanning, goal and strategy development, policy development and overall performance evaluation and accountability.

Learning Point

Legal Obligations

  • Fiduciary duty

  • Duty of Loyalty

  • Duty of Care

    • Duty of Supervision

      • Duty of Dissent

Learning Point

Duty of Dissent

  • Things must pass the smell test or be pursued

  • Too much harmony can be lethal

    • Culture of politeness

    • Group think

    • The fallacy of consensus

  • Culture of results

    • Confront the facts

    • See truth, be open minded

    • Dialogue and debate, not argument

    • Civility, respect and trust

    • Disagree, don’t be disagreeable

Learning Point

Legal Documents

  • Articles of Incorporation

  • By-Laws

  • 501 (c) (3) Qualification

  • Accreditation

Learning Point

Board Responsibilities

  • Determine the purpose of the organization

  • Provide the resources

  • Get the right people – particularly the CSO

  • Establish responsibilities and authority

  • Set goals mutually

  • Advise and consent on strategies to achieve goals

  • Align interests to achieve the goals

  • Know what is going on

  • Intervene when necessary

Learning Point

The Players and Their Roles

  • The Chair: Leads the board, prime contact with the CEO

  • The Board: Governs. Time-Talent-Treasure

  • Committees: Executive, Nominating/Governance, Program, Finance/Audit, Development

  • The CSO: Management Responsibility

  • The Staff: Works for the CEO; Performs functions

    • The Development Officer – Manages fund raising

  • Volunteers: Works for the CEO, Performs functions

Learning Point

The Partnership of the Board Chair and the Chief Staff Officer

  • Trust

  • Role definitions

  • Avoiding unexpressed expectations

    • Clarity about goals, policies, standards of performance

  • Defining norms for

    • Communications

    • Planning

    • Problem solving

    • Resolving conflict

    • Working styles

Learning Point

The Partnership of the Board Chair and the Chief Staff Officer

They need to be working together to:

  • Oversee the performance of the organization

  • Obtain resources

  • Examine high level long patterns of clients needs and organizational effectiveness, validate what they mean and determine how to react.

  • Manage the effectiveness of the Board

Learning Point

Board Committees

  • A Board does much of its work through its committee structure

  • How do committees work?

    • They have a charge or assigned responsibility

    • They have specialized expertise consistent with their responsibilities

    • They can take action, or make recommendations to the board as determined by their charge

      Governance Committees versus Working Committees

Learning Point

Typical Governance Committees

  • Executive Committee

  • Finance or Budgeting Committee

  • Development Committee

  • Nominating or Governance Committee

  • Program Committee

  • Planning Committee

Learning Point

Board Meetings

  • Frequency and length of meetings

  • Agendas

    • Consent agenda

    • Review of the situation (Reports)

  • Briefings

  • Issues and Actions

  • Planning

    Focus: More on substance and the future

    Less on minutia and the past

Learning Point

The Chief Staff Officer

What does the CSO do?

  • Manages the organization consistent with the delegated responsibilities.

    • The CEO model versus the Executive Director Model

  • Is accountable to the board so must keep the board appropriately informed.

  • How is compensation determined?

Learning Point

Board’s Role In Strategy

Provide effective leadership that keeps the parts together:

  • In determining purpose

  • In hiring the right CSO

  • In determining the vision

  • In assessing the current situation and the need for change

  • In setting goals

Learning Point

Board’s Role in StrategyRef: Boards That Deliver by Ram Charan

  • Many directors are frustrated that a basic question about the organization’s strategy is not answered to their satisfaction.

  • At the same time many CSO’s are frustrated that their boards keep revisiting the question, even after management has gone to great lengths to answer it.

  • This leads to lost opportunities for a board to add value.

  • The source of this angst is how and when strategy gets discussed.

Learning Point

Board’s Role in StrategyRef: Boards That Deliver by Ram Charan

  • Discussion of strategy, too often, takes place

    • piecemeal over a series of meetings, often at the tail end.

    • In longer meetings devoted to one-way presentations of the strategy as a finished product

    • When discussion does occur with what little time is left, there’s no clear train of thought, and seldom any closure.

Learning Point

Boards Role in StrategyRef: Boards That Deliver by Ram Charan

  • A process to help shape and get full understanding and agreement

    • Strategy is born from management’s analysis and creativity and presented to the board

    • The Board then probe it, question it, and offers opinions on it.

    • As the strategy is reshaped and improved, management and the Board reach a common understanding of it.

Learning Point

Board’s Role in StrategyRef: Boards That Deliver by Ram Charan

  • Getting alignment on strategy includes:

    • A common understanding of what strategy is – and isn’t

    • A strategy immersion that gets directors thinking more deeply about the business and its context and creates agreement around a particular strategy

    • A strategy blueprint as a vehicle to get consensus on the company’s strategic direction

    • A strategy monitoring process to assess day-to-day performance toward the long term strategic goals

Learning Point

Determining When Change is Required

  • A Shared Vision

  • Where are we now?

    • A Common Understanding of the current situation

  • Identifying emerging new trends

    • An understanding of and a commitment to the need for change – in terms of degree and urgency

      The Challenge: What needs to change?

Learning Point

Building the Board

  • What do you want?

  • How do you find candidates?

  • How do you recruit them?

  • Who elects them?

  • How do you energize them?

    “You get the board you deserve”

    Charles Bryan

Learning Point

The Variables

  • Leadership

  • Competence

    • Need a diversity of talent

      • Program

      • Business – legal, accounting, administrative

      • Fund raising

      • Demographics

  • Commitment

  • Relationships

  • Agendas: What are the politics?

Learning Point

What Can Go Wrong?Syndromes

Learning Point

What can go wrong?People Problems

  • Incompetence

    • Ineffective board leadership

    • Ineffective CEO

    • Ineffective Board Structure and processes

  • Attitudes and relationships

    • Entrenchment – a ruling clique

    • Politics/personalities

    • Indifference/lack of commitment

    • Lack of independence

  • Management Style and decisions

    • Micro-managing versus Governing

    • Failure to address issues

    • No clarity of purpose

    • Poor Planning and controls

Learning Point

Secrets to Success

  • Clarity of Purpose

  • Strong, committed constituency

  • A competent and committed board that works well together

  • A strong CEO

  • An effective staff

  • A Hedgehog Concept

Learning Point

Collin’s Hedgehog Concept

From “Good to Great”







Learning Point

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