Should Committees Report to the Board?

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Note: At the end of this year I will no longer be posting here at The Hourglass Blog. To see my reasons why click here. To keep following me on my new blog, go here.

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I've been thinking a lot about this question lately. It's a question, I know, that never even occurs to leaders in many associations. "Should committees report to the board?" they might say. "Of course they should. Who else are the going to report to?"

Well...

How about the chief staff executive?

I've suggested just such an idea before, and the looks I get back from chief staff executives and board chairs alike can only be described as incredulous.

But hear me out.

There are some committees whose jobs clearly relate to the governance of the association. The Finance Committee. The Nominating Committee. The Executive Committee. These are all bodies appropriately appointed by the Board to help it do its job better.

But there are other committees whose jobs relate to the management of the association. The Education Committee. The Membership Committee. The Marketing Committee. These are all bodies designed to infuse the management practices of the association with the expertise and wisdom of association members themselves.

If your association is an association of widget manufacturers, then you might want widget manufacturers on your Marketing Committee to help you decide how best to market your association to other widget manufacturers. If your association is an association of physicians, then you might want physicians on your Education Committee to help you decide what kind of education to deliver to your members. In most associations, this type of industry- or profession-specific expertise does not exist at the staff level, and the synergistic fusing of member knowledge with staff functional expertise can spell great success.

But in all of these cases, the functions of these "program" committees are not related to how the association is governed (i.e., the purview of the board). They are related to how the association is managed (i.e., the purview of the chief staff executive). And if that is the case, shouldn't these committees "report" to the chief staff executive, the way other members of the staff do? In fact, doesn't having those committees report to the board put the board in the position of having to manage the association, usurping the position and authority it has specifically delegated to its chief staff executive?

These are the thoughts I think about whenever I sit in a board meeting and find myself trapped in a discussion about the details of some committee report. Committee X wants funds to produce a new marketing brochure. Committee Y wants approval on the venues it has chosen for next year's educational sessions.

I can't help it. As a board member, my first question when faced with these requests is always: Why are you asking me? I don't manage this association. The chief staff executive does.

And I'd prefer to keep it that way.

Those Who Understand Your Members Best Aren't on Your Board

I have a hard time keeping up with the blogs that I follow. I use an RSS reader to keep an eye on them all, and each day I go through the new items there and do a quick triage. Each one gets a thirty-second scan: (1) Nope, not interested. [Delete]; or (2) Hmmm, that's interesting and it's short. I'll read it right now; or (3) Oh man, that's going to require some thought and some processing. I'll flag that and get back to it later.

One that recently fell into that third category was Joe Rominiecki's Acronym post on What good is governance without influencers?, which was based on Maggie McGary's post on Influence in the Context of Associations. They're both discussing the rise on online and non-traditional influencers in associations, and how these thought leaders and the followers they attract are changing the leadership dynamic in our community. Maggie asks:

[A]s time goes by and more of your members begin interacting in the online community, a new group of influencers will grow out of those interactions. Meanwhile, traditional influencers—board and committee members—will become less visible and, therefore, less influential and important, at least to members. Will you know when this change occurs, or will you be stuck in thinking the wrong people matter the most?

I see this change taking place in my own life and in the associations I'm affiliated with. I wrote about it here, and called it "networking in a box." Associations want to keep members connected within their own "boxes," but more and more the borderless online world is allowing people to create and leverage their own networks that don't follow any pre-existing association lines--which are, to the concern of the pre-existing associations, all the stronger and more powerful for it.

Joe speculates that associations should work to bring the online influencers in the lives of their members into the leadership of the organization, but struggles to identify a mechanism for doing so. I sympathize. To many non-traditional influencers, I would imagine that the structure and hierarchy of formal association leadership would seem like shackles compared to the freedom of association they currently enjoy online. They will naturally reject the idea of being locked up in anybody's box.

I think traditional boards are growing less and less in touch with their respective memberships--and the rise of online influencers is only one of the reasons why. But you know who remain in touch with their membership? Association staff. Especially staff people that naviagate, either as part of their professional responsibilities or personal interests, the same open and unstructured online networks that the influencers do. Joe himself, I'll bet, is much more in tune with what the ASAE members are thinking, than many of the well-intentioned and hard-working folks on the ASAE board.

Does the ASAE board view things this way? Does Joe come in at the start of every board meeting and give a ten-minute update on what's on the mind of the members, of what topics are being discussed in the blogosphere, of which ones seem to resonate with people and which ones don't? Would the board members listen to him if he did?

Maybe it's not a staff person in your association. Maybe it's one of your association members. Maybe it's the editor of one of your industry's trade magazines. Or maybe it's a blogger who has critical things to say about what your association does. Whoever it is, if they are more connected with your membership than your leadership is, you'd better find a way to get their market intelligence into your strategy discussions. And asking them to serve on your board is not going to work. They're not interested.

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You Can't Lose What You Ain't Never Had

This is the fourth and final part of my reaction to Jeff De Cagna's excellent article on business model innovation for associations in the April 2011 issue of Associations Now. In part one I talked about how the primary challenge for associations in innovating is a cultural one, and how organizational priorities need to move away from established structures and towards whatever mechanisms help the organization deliver better value for its members. In part two I talked about one of the ways of doing that—tearing down the walls that get put up between association staffers and members and allowing them to honestly interact with each other as human equals. In part three I tried to defend the value of face-to-face relationships in an increasingly digital world, and the inherent value those face-to-face connections will continue to have for associations.

Now, I want to talk about losing control. Jeff writes:

In a blog post last summer, Tim Leberecht, the chief marketing officer of frog design, riffed on “design for the loss of control,” a concept first articulated by J. P. Raganswami, chief scientist for Salesforce.com Leberecht argues that organizations may find value in intentionally designing their work to narrow the extent of their control. As he writes, “A deliberately designed loss of control grants companies the only remaining and arguably most critical competitive advantage: access. As long as they enable and facilitate knowledge flows, ideas, passions, skills, and experiences, they have access to them. For most association leaders, this is a hugely radical, even dangerous, idea. And yet it is quite possibly the most important design principle for all new business-model concepts of associating. In very practical terms, business models designed for the loss of control may well deliver greater value while incurring lower costs. After all, among other problems, control is expensive. In strategic terms, business models observing this design principle can help energize stakeholders with a renewed sense of purpose. Among other opportunities, the loss of control encourages new self-organized forms of associating.

I’m a big advocate for the idea that control is a myth—especially in the world of successful associations. Jamie Notter has written about this on his blog as well (and he gets a surprising number of comments whenever he does). It’s my view that as an association executive, there is very much that I can shape, but there is very little that I can control. Nor should I seek to. Perhaps that’s why this sentence from Jeff’s article really jumped off the page at me.

For most association leaders, this is a hugely radical, even dangerous, idea.

Is it really? Jeff’s not specific, but when he says “leaders,” I assume he’s referring primarily to staff executives. And some of them probably do fear losing the control they have built up over their long years of service. We all know execs like this. They control the agenda, the discussion at their Board table, and, to a certain extent, their Board members themselves. But ask the volunteer leaders in those associations about this thing Jeff is describing as “loss of control” and I suspect you’ll get a much different answer.

I’m an association executive. But I’m also an association member, and recently I became and association Board member. These alternate perspectives have helped me tremendously, both in doing my own job and in helping my Board members do theirs. And more than anything else they have helped me see how stifling the pursuit of control can be.

Speaking as a volunteer Board member, I know that we have boundless passion for the industry or profession we represent. Way more, I think, than we should expect any staff executive to ever have. We want to do something to make a difference, to advance ourselves, our profession, and our organization. And one thing we’re really good at is determining whether the Boards we’ve found ourselves on are vehicles or impediments for fulfilling that desire.

As an association executive, I shouldn’t try to control that enthusiasm. I’ll be tempted to sometimes. Sometimes I’ll think they’ve gone off the tracks and they’re trying to take the association with them. But in those cases I need to shape, not control. Because control by the staff executive makes Board members check out, simply ride out their terms, and, to the detriment of what I’m trying to achieve, go looking for other places to invest their energy. Control is counterproductive.

I know. I’ve seen it from both sides.

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Post title refers to this. Go watch it.

Same Goes for Board Agendas

Here's something thought-provoking from Hugh MacLeod.

When I saw it, my first thought was, "Same goes for blogging." This whole Hourglass experiment, after all, isn't an attempt to make money. It's an attempt to engage a certain group of professionals, whose voices aren't frequently heard, in a dialogue around a set of leadership issues I believe are getting short shirft in current blogosphere.

But upon further reflection, I came up with something more practical for the current association leader: "Same goes for Board agendas." With apologies to Hugh, I would paraphrase his sentiment as: "You don't set Board agendas to manage your association. You set Board agendas to define the ground on which you want your Board to act."

It's a lesson that sometimes takes a while to learn. If you want your Board to deal with strategic issues, make sure you are putting strategic issues on their agenda. It's harder than it sounds, but really not that much.

And by the way, if you haven't subscribed to Hugh's daily cartoon email, you really should. He's got a knack for speaking to directly to the artist in you and helping you connect those passions to the things you do for a living.

How to Tell if You Have a Bad Board

I think I've mentioned before that one of the things I like to do on Hourglass is look at policies and practices in the for-profit world and see how they compare or can be applied to associations. My work on the WSAE Innovation Task Force came almost entirely from this mindset. As the Executive Director of a professional trade association, whose Board members are a group of very successful business people, I'm frankly fascinated by the interplay between for-profit and non-profit sensibilities. In my experience, the fresh thinking it inspires works best when it flows in both directions.

But as Shelly Alcorn recently reminded me, the for-profit model is not always the best template for association activities. Here's a case in point. Another HBR blog post from Roger Martin, this one focused on six ways to tell if you have a bad board. Written from a decidedly for-profit and publicly-traded perspective, Martin includes such tell-tale signs as:

1) They complain about how hard Sarbanes-Oxley has made it to be a director.
2) They complain about how the fees for being a director aren't high enough to compensate for the onerous work involved.
3) They are paid in the top tertile of peer boards.
4) They express excessive pride over being on the board.
5) They express enthusiasm for the enjoyable social atmosphere on the board.
6) They express enthusiasm for the personal growth opportunities the board provides them.

If you ask me, these are either not problems for most associations (#1, 2, 3) or may actually be good things in our environment (#4, 5, 6). Seriously, a desire for personal growth is a good thing in an association Board member, isn't it?

But this analysis begs the obvious question. What are the signs of a bad association Board? If we were to take a poll of association executives, we'd probably see things like:

1) They don't show up for board meetings.
2) They show up for board meetings completely unprepared.
3) They don't disclose their conflicts of interest and use their board positions to financially enrich themselves.
4) They micromanage staff activity.
5) Individuals publicly disagree with decisions of the board.
6) There's more than 20 of them.

When you compare those two lists, you see how far apart the for-profit and non-profit worlds sometimes are.

Photo by fpra

The Sad Paradox of Board Governance

This post really got me thinking. In it, Roger Martin describes what he calls the "sad paradox of board governance" in the corporate world. It's worth a full read, but the quick summary is that a publicly-traded company with "bloody-minded" CEO, one who wants to take advantage of the shareholders for his own benefit, winds up getting passive Board directors, because that CEO makes sure no one comes onto the Board who will challenge his authority. While the company with a "romantically-inclined" CEO, one who just wants to do the right thing for shareholders because it is the right thing to do, gets engaged Board directors who will challenge her assumptions because she understands that this is part of good governance and she wants to company to be the best it can be. In other words, when its comes to protecting the interests of the shareholders:

When the shareholders need the directors least, they get them most. And when they need them most, they get them least.

Does the same paradox apply to the association world? When the members needs a watchdog board the most, because they have a "bloody-minded" CEO abusing his position for his own personal benefit, do they wind up with a board full of pushovers and clock-watchers? And when they need that engaged board the least, because they have a "romantically-inclined" CEO working day and night to leverage all of the association's resources for their needs, do they get a board that is overly-engaged, micromanaging, and preventing the CEO from doing all that she could? I think every association professional reading this blog could probably tell one or two stories that support one or both of those scenarios.
 
But here's the twist. I think the same paradox works in reverse when it comes to associations. When the members need a crackerjack CEO the most, because they have a board comprised of well-meaning but hapless managers, they get just the opposite--a CEO who will take the small-minded orders of the dysfunctional board, and someone who will be quickly disciplined or replaced if they ever stray out of the narrow zone of influence the board has defined for them. But when the members need a gunslinging CEO the least, because they have a board that understands the separation between governance and management, that stays focused on the big picture, and delegates to the CEO in terms of limitations and not prescriptions, that association gets a really talented CEO because that board knows what it's doing and how key an effective CEO is to organizational success.
 
The sad truth for associations struggling with the some part of the governance/management gap is that there are more ways to fail than there are to succeed.  

• Hapless board hires crackerjack CEO ---> Hapless board fires crackerjack CEO for "overstepping" his authority ---> FAIL
• Hapless board hires hapless CEO ---> Association achieves nothing of significance ---> FAIL
• Crackerjack board hires hapless CEO ---> Crackerjack board fires hapless CEO for being ineffective ---> FAIL
• Crackerjack board hires crackerjack CEO ---> Association achieves big things ---> WIN!!!

It sort of reminds me of that other paradox, the one about chickens and eggs. When it comes to organizational performance, which comes first? The CEO or the board?

Photo by The Wanderer's Eye

When Board Meetings Are Like Bad First Dates

Read this. It's a blog post by Dan Ariely about some research he did on how people act on first dates.

First dates are all about strategies that both parties can agree to but which won't help them learn if the date was effective. Think of a first date: We try to express ourselves and learn about the other person, but not express ourselves too much or offend by being intrusive. We default to friendly over controversial, even at the risk of sounding dull.

Sound familiar? Dan's talking about dating, but it reminds me of some association board meetings I've been in. "Default to friendly over controversial, even at the risk of sounding dull." That's practically a mission statement for some associations.

Dan calls this "bad equilibrium"--a strategy that doesn't result in a positive outcome for anyone. To change that dynamic, Dan ran an experiment, in which he limited the type of discussions people on first dates could engage in. He gave them a list of questions, and their discussion could only revolve around those issues. Questions like:

• How many romantic partners have you had?
• When was your last breakup?
• Do you have any STDs?
• Have you ever broken someone's heart?
• How do you feel about abortion?

What he did, essentially, was rig the market. He imposed an artificial risk level that would help prevent bad equilibrium.

We believe that restricting the market in such ways can get people to gravitate toward behaviors that produce better results for everyone. (Remember, in dating, learning sooner that you're not compatible is a better result than wasting time being polite to each other.)

Does the same theory apply to association board meetings? Like Dan says, by forcing people out of their comfort zones, might we ultimately gain more than just allowing everyone to fall back on those tropes that are safe for everyone, and useful to no one?

If so, what kind of questions would you put on your board members' discussion list? And what kind of questions should your board members be putting on yours?

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Those Fish Aren't Dead, They're Just Tired

This post from David Simms of the Bridgespan Group on the Harvard Business Review Blog got me thinking. In it, Simms bemoans the state of many nonprofit Boards, describing them as "aquariums of dead fish"--unengaged and unproductive. Here's one of his key observations:

What some board members tell me, when pushed, is that they tolerate things on a nonprofit board that they wouldn't stand for in their day jobs. The boards don't ensure that the organization has a sound strategy, they tolerate mediocrity in management, they don't hold the organization accountable for results, and they don't ensure that resources are adequate to accomplish goals.

I've seen this in my own experience--individual board members who demand excellence in their own organizations and in their own careers, but who don't insist on the same high standards for the association they have accepted governance responsibility for.

Why is this? One reason could be that the "fish" aren't dead, they're just tired.

Individuals who are driven to succeed in business or in their own careers generally have a lot of energy, which they need because success is hard. It takes focus, commitment, and endurance to be the best you can be at something. Association success is no different, except that it may be even harder than individual success, because the objectives are bigger, the stakeholders are more varied, and the politics are more complicated. New Board members may come into the situation intending to drive greater success, and even be ready to swim upstream, but step away after realizing the amount of personal time and energy real change will require.

How many times have you seen this happen? An association board says do X, and the executive director responds with, okay, that will require Y, with Y being some combination of staff time, money, and board member engagement. Staff time is never a problem from a board's point of view, and there's usually a solution laying around somewhere when it comes to money. But board member engagement? That's one of the most valuable resources an association has, and it is in very limited supply. If a project requires too much of it, even if it's something the board believes in, odds are the project is not going to succeed.

One of the essential responsibilities of a board is to ensure that the association has adequate resources to accomplish its goals. Board member involvement is one of those resources, but how many boards talk openly about how much of this resource there is and how it should best be applied? If you deal with this subject frankly, you may give some of those dead fish a reason to start swimming again.

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Association CEOs and Board Culture

A couple of posts ago I talked about some of the lessons I'm learning while serving as a volunteer Board member for my state association executives society. For me, it's been a great experience and something I would recommend for any association CEO who wants to improve how their Board functions. But today I wanted to share one key lesson I think I've learned from the other side of the fence.

I've been the CEO of a trade association for about three and a half years now. And I've just returned from one of my own Board meetings. Since it's near the end of our fiscal year, and several Board member terms are coming to an end, this was the meeting where departing Board members were thanked, the gavel was passed to a new chairman, and incoming Board members were given their first glimpse of how this Board operates and what it is that they'll be expected to do.

And as all that was happening, it occurred to me that it will only be a few more years before it's me--the CEO--who will have the most association-specific experience at that Board table. The group of Board members who were there when I started--and who really set the tone for what the Board is and how it will govern the association--are bit by bit rotating off, and the new people coming on--while well-intentioned and experienced in their own businesses--understandably have more questions than answers in this regard.

If there are traditions to honor, policies to enforce, and expectations to communicate, it'll be up to me to make sure they are appropriately honored, enforced and communicated. Now, for new Board members, and soon, for the entire Board, I will be the sole source of information for what the Board does and how it does it--not just its procedures but its very culture.

This is a different view of the equation than I've previously had. New Board members don't really know what they're getting into, and their on-boarding is a critical time to get them engaged and assimiliated into the culture of the team their joining. An experienced association CEO can take ownership of that culture in a way new CEOs can't, shaping it Board member by Board member in a positive direction and then reinforcing its best elements for the good of the organization.

Lessons from Being a Board Member

I said I was going to comment on my experience as a Board member. After 16 years of working with Boards as an association staff person, I'm now serving on a Board myself, and learning lot about the color of the grass on the other side of the fence. Here are some quick things to remember the next time you're frustrated with a Board member.

1. Everyone's schedule is already full. Volunteering for a Board means adding something to an already full plate, which means an engaged Board member is either doing association work outside of work hours and neglecting their personal pursuits or during work hours and neglecting their professional pursuits. You must make volunteer activities relevant to a Board member's personal or professional pursuits so they don't have to make these painful choices.

2. Let’s talk strategy. Don’t waste the Board's time on operations. Staff does operations and Board does strategy. I get it. That Board member who doesn't speak up might be frustrated with the tactical level of the conversation and wondering what he got himself into.

3. Committee chairs do the most work. Thank them. Often.

4. Numbers get confusing. Even smart people who reviewed the agenda materials before the meeting get confused when line items in a budget start getting tossed around. Slow down. I'm not questioning your competency by asking questions.

5. Socializing is important. I've joined a team and that is being asked to perform before all the players have been properly introduced. Hearing everyone's name and the organizations they work for is not enough. Why are they here? What do they want to accomplish? Let's spend some time talking about that first.

The Boomer's Revolt

One of the nice things about following Neil Howe's Lifecourse Blog is that he will often point you to current news stories and give you an interesting interpretation of them through the lens of his generational theory. Case in point is this post, which links to this story. The story is about an increasing trend among state politicians to denounce the authority of the Federal government, and cites several examples of state laws being enacted in order to nullify such potential Federal actions as firearms regulation and health care reform.

Howe's comment seems to imply that he thinks these are all actions of Boomers, rebelling against manifestations of what he calls the Fourth Turning--a climactic crisis in which the very fabric of our society is in danger of being torn beyond repair. In their minds, these Boomers must be using whatever tools are still at their disposal to help save our culture. Obviously, the younger generation now coming into power can't be counted on to do what's right.

I'm not sure the States' Rights movement is entirely a Boomer phenomenon, but the general idea is a curious one. Given what we've talked about regarding Boomer leaders staying in power longer than previous generations and for-profit Boomers moving into vacant leadership positions in the non-profit sector (in part because of the smaller number of qualified GenX non-profit leaders able to step up), I wonder if a similar dynamic will begin to manifest itself in our environment.

Imagine a group of GenX leaders in a particular sector, pushing for some needed reform, and their actions being "nullified" by a still connected group of Boomer leaders, pushing back more against the idea of reform than the reform itself. Or let's have this hit closer to home. Imagine this happening on your Board of Directors, just as the GenXers you've worked hard to recruit start gaining a critical mass.

If Howe's interpretation is correct, and the waning Boomer generation will view the end of their influence on society as identical to the end of society, effective governance in the 21st century is going to be a lot more complicated than anyone might have previously thought.

Big Idea: What if Associations Allowed CEOs to be Board Chairs?

I thought I'd get in on the action with December being declared Big Ideas Month over at the Acronym Blog.

This post from the Harvard Business Blog has been kicking around in my brain since I first read it in early November. In it, Bob Pozen asks if for-profit CEOs should be allowed to be Chair of their own Boards. In other words, are companies better run when a single person holds both the position of CEO and Board Chair, or when two different people--with different skill sets--each hold one of those positions and work together as a leadership team?

I'll admit, my first reaction was to think two. You've got to have two different people in those positions because they encompass two very different sets of responsibilities, and they are meant to complement and counterbalance each other.

But Pozen goes on to state that empirical studies show no statistically significant improvement in either a company's net income or its stock price when those positions are filled by two individuals versus one. Indeed, Pozen says, the only arrangement that seems to show consistently negative results is when a former CEO becomes the Board Chair of the same company. In the for-profit world then, having a separate CEO and Board Chair is not necessarily an advantage. Pozen says that only 37% of U.S. companies have that arrangement.

So that got me thinking about the association world. In my own experience, every association I've ever worked for has had separate Board Chairs and CEOs. And that's also true of every other association professional that I know. Is there anyone out there who actually serves both roles in a nonprofit association? Would such an arrangement even be legal? Given the amount of literature, educational programs, and hallway conversations that go on about how to keep the two jobs separate but closely aligned, I have to think the practice of having a single person fill both roles in an association is either rare or illegal.

But what if it wasn't? A Google search turns up a fair amount of debate on the subject in the for-profit world. More seem to think it's better to split, but those who think it's better to merge cite several advantages:

1. Once a Board commits to merging the two roles, they spend less time on a watchdog evaluation of the CEO and more time on making smart decisions for the organization.

2. A combined CEO/Board Chair is better able to withstand pressure from the Board and stick with a long-term strategy, especially when short-term changes don't immediately pay off.

3. A CEO who is not the Board Chair is the Board's hired hand. A CEO who is also Board Chair has far more influence over the other Board directors.

I personally have never wished to be both the CEO and the Board Chair of the associations I've worked for. And I'm not bucking for the job now. But I can imagine situations when such a structure would be advantageous.

So much time and energy is spent on getting the right leadership team in place--two individuals that understand their roles, clearly communicate with one another, and work in partnership to fulfill the association's mission. When it works, it works really well. But such successful synergies take time to develop, and too often they end before they even get started, because Board Chairs ultimately rotate out of the positions at the end of their terms. In the associations I've worked with that's usually after one year. I still remember what it felt like to "lose" the best Board Chair I ever worked with.

As association CEOs we know this turnover is inevitable. So, we develop all kinds of policies, procedures and resources to bring the new Board Chairs up to speed as quickly as possible. We know they are key to our organization's success, so we do things like groom them while they're in subordinate positions on the Board. We create committees made up of future Board Chairs to help determine long-term strategy, and we use the decisions of those committees to help shield our associations from the distractions that come with having to "turn the battleship" with each new Board Chair, or with needing to protect "legacy programs" of past Board Chairs. We spend copious amounts of our time on these activities, working hard simply to get our associations ready for effective governance.

Imagine what our associations could accomplish if more of that time was spent on actual governance itself.