Inside Tips for Creating a Strategic Board

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This article was written by Elise Sernik and Barb Barkley of Leadership Space
 

Many leaders want to create a better board for their organisation but are stumped as to how to go about it in a way that fits with their values. Whether you are a Chair, Director or CEO, the prospect of trying to take your board on a journey of self-improvement leaves many people feeling some combination of wary, overwhelmed and even just plain queasy!

We talked to five leaders who have done the hard yards and asked them to share their tips. Our generous interviewees were:

  • Angela Tillmanns, CEO of Cerebral Palsy League (CPL)
  • Helen Darch, Chair of Cerebral Palsy League (CPL) and of Children’s Hospital Foundation
  • Doug Taylor, Director of Strategic Engagement UnitingCare NSW & ACT (recently CEO, United Way)
  • Allan Vidor, Chair of Jewish Care
  • Rosemary Bishop, CEO of 3 Bridges; Director on Australian Foundation for Disability (AFFORD)

Why improve the board?

Before exploring how to support board development, it is worth pausing for a moment to reflect on why social purpose organisations need a high-quality board. The answer, according to Allan Vidor, is simple: “Having a good board is an enabler and a major asset.” This is no small thing in a fast-changing sector that is facing significant disruption to its business models, customer base, funding and market positioning.

 

Helen Darch CEO of

Helen Darch Chair of Cerebral Palsy League and of Children’s Hospital Foundation

According to the leaders we interviewed, a strong board provides the resources and time required for a strategic focus. It also delivers leveraged networks and access to critical competencies in areas such as mergers and acquisitions, risk management, strategic partnerships, and technical skills that align to the organisation’s needs. Their argument is that you can’t afford to allow a board to coast along because it represents a major risk to your organisation’s sustainability and therefore its ability to achieve mission.

 

What is a high performing board in the current context?

Whilst most of us know a good board when we see or sit on one, having a tool to communicate this understanding to each other in a way that is respectful and consistent is helpful.

 

In our work we suggest that a simple but effective lens is to think about a board as having two distinct responsibilities: Governance and Leadership. They aren’t mutually exclusive and as Doug Taylor notes the reality is that it is more like “an ecosystem of shared governance and leadership”. Nevertheless, they are two quite different modes.

 

When the board is in governance mode the guiding question is ‘Are we functioning well?’ The board here is concerned that the organisation is safe and that business as usual is under control. When you’ve got good governance things feel secure and locked down. In human services, this is about “managing risks like not hurting the clients or staff and managing funds well”, explains Angela Tillmanns. The catch is she says, “If you’re just wanting to run an efficient organisation and have things under control, that’s governance, and it’s not enough”.

 

If there is a guiding question for the mode of leadership, it is perhaps, ‘What is our future?’ The tasks of the board in this mode are in the domain of strategy. This work, says Taylor, is inherently “harder, bigger and messier than governance”. According to Tillmanns the mark of being in this mode is that “you leave board meetings feeling uncomfortable”.

 

What is driving this discomfort is that the board is trying to figure out what the future reality will look like and gauge the risk of this future to the organisation as it is currently configured. This is an adaptive task of reflecting on every part of how the organisation operates, why it does so, and what is required not just to respond to the change, but to get on the front foot and lead change. It is uncertain work, Tillmanns says, because “the future is not crystal clear”, and it generates big questions about organisational purpose. “We talk frequently about how change in the external environment links back to our purpose. We ask ourselves, ‘Is our vision audacious enough and does it align to purpose?’ and even ‘is the way we articulate our purpose still right?’”

 

For the organisations we talked to this means that strategic planning looms large. “It is no longer valid to have one strategic planning session per year,“ contends Tillmanns. At CPL Board meetings, Darch explains, “Strategy is on every agenda and it’s high on the agenda.” Both Bishop and Vidor talk about the deep thinking that has gone into integrating and embedding strategic feedback loops between management and the board so that strategy is an ongoing and very alive dialogue at the board level.

 

Rosemary Bishop, CEO of 3 Bridges; Director on Australian Foundation for Disability

Rosemary Bishop, CEO of 3 Bridges; Director on Australian Foundation for Disability

 

In practice, what is the right balance between governance and leadership?

Darch reflects that there has been a big shift. “Six years ago I would say we were 20% focused on strategy” she says. “Now it’s 70%”. Taylor concurs that the balance must be moving towards leadership. He also points out that it is important to be sensitive to the life cycle of the board and the organisation and have patience. “It took 3 years to move us from being a local to a national board”, he explains, “and another year to move from being a representative to more of a leadership board. It was hard, hard work to get to that point where we were positioned so that we could look at our bigger strategic issues.”

 

The consensus is that a good measure of the health of an organisation is that the board is working towards spending around half of its time in leadership mode, and half in governance mode.

 

How do you get firmly on the evolution journey?

The consensus from our interviewees was that there are five components that work, and that they can be used together or in some combination.

 

1. Get the right Chair for your organisation’s current needs

 

If the right Chair is in place, then the organisation is strongly positioned. For many organisations with a less than ideal split between governance and leadership, often an uncomfortable reality is that the Chair is not right for the organisation any longer. Through no fault of their own and usually with no slur on their achievements to date, it is simply that the requirements of the role have shifted so significantly that they are no longer the right person for the job. Figuring out what the organisation needs from its Chair requires some specific work on your organisation but, says Bishop, “having enough time is a big element and often over-looked”. It’s a point that resonates with many. In a piece of work we recently completed our client heard that amongst their peers, Chairs were estimating the job took half a day per week of their time to do well.

 

For Darch, the new environment also means that Chairs need to be “really skilled and compassionate facilitators”. When they are doing this well she says it creates “a very open, non-defensive environment”. “This paves the way”, says Vidor, for “having an open and honest discussion about the skills needed to steward the organisation through the next phase of its development”.

 

Allan Vidor, Chair of Jewish Care

Allan Vidor, Chair of Jewish Care

2. As CEO, step into your role with the board

 

For many CEOs the prospect of creating a feisty board brings mixed feelings. It’s a reasonable concern says seasoned Director, Darch. “A professional board can be demanding for the CEO”. The issue, says Vidor, is that “when a CEO has the wrong board their time is spent on managing the board rather than getting value from them.” Experienced leader Bishop adds another dimension. For her, it is about professional risk. “If you are doing brave things as CEO” she says, “and it’s not reflected at the board, then you as CEO are being exposed to undue risk”.

 

The answer for Taylor, is to recognise and embrace the informal power that you hold with the board as CEO, which is different to the formal role the Chair holds, but no less critical. In his case, he says “it was clear for me as CEO that [board restructuring] was my number one thing.” Influencing, in this context, he acknowledges is a tension but “positive change won’t happen in and of itself. There has to be a catalyst.” The way through, he counsels, is to be “highly intentional and strategic about how you proceed but at the same time, transparent.” Reflecting on her journey Bishop says, “As a Director I pushed the need to change the board but I did it with the board’s agreement and with kindness. As a CEO my influence with key board members has supported them to lead board renewal.”

 

3. Don’t be afraid to find others who are asking questions

 

“If there is one person asking questions then invariably there are others”, says Taylor. “Work together to get clear questions on the agenda in the most open and transparent way.” It’s a journey Darch has travelled as a Director who was not the Chair. “I was frustrated because I could see damage was being done and we needed to work hard to rebuild the board team.” The good news, according to Bishop, is that “you only need three key people that understand the situation and are champions,” to be on the way to becoming a developing and changing board.

 

Being a change agent is daunting and for many directors they are rightfully nervous of their actions being seen to be a political maneuvering. It’s a well-founded concern, says Taylor because “seeing a power play going on is deadly for a board.” For Darch the way through this dilemma is to “understand your own motivation and know that you must focus on what is best for the organisation in the long run”. “Build consensus” she says, “by truly listening so you can understand who is stuck and why. If you are aligned to the organisation’s purpose and sustainability, and are well motivated then maybe you’re the ‘sand in our pants’ Director. It’s good for us, even if it’s uncomfortable!”

 

Doug Taylor, Director of Strategic Engagement UnitingCare NSW & ACT

Doug Taylor, Director of Strategic Engagement UnitingCare NSW & ACT

4. Introduce voices of experts

 

For the leaders we interviewed, external people have a crucial role to play in helping a board understand the changing context and strengthening openness to change. Reflecting on the years of change at United Way, Taylor explains how bringing in “thought leaders and guest speakers helped to underscore the changes and issues”.

 

It is just part of what it means to be “a learning organisation,” says Darch. “Don’t just reinforce what you already know. Challenge everything.” Tillman advises “Bring in people from outside the sectors to inject a new way of thinking, a wake up call.” For Vidor, it’s about having “an appropriate level of anxiety about the profound changes that are happening in the sector”. If you aren’t hearing about industry disruption first hand, then it can be easy to coast along feeling like it’s not going to affect you.

 

Angela Tillmanns, CEO, Cerebral Palsy League

Angela Tillmanns, CEO, Cerebral Palsy League

5. Use the tool of the Independent Board Review

 

Leading practice says that every few years the board should undertake an externally facilitated process of evaluation and reflection. If undertaken by someone who is thoughtful, caring and skilled, a board review can just be the breath of fresh air needed for a board. Often it is the first time all Directors have had a chance to chance to reflect on their role, aspirations and concerns confidentially. The key is to ensure that the outcomes and insights are then shared back in a constructive way that ensures the board gets a good and honest read on where they are at in terms of board development, and a clear sense of how to build forward.

 

There are different ways to introduce a review to a board. CEOs may find it is a requirement for some funders – for others, such as Darch, the message that her small group of Directors came forward with was “it would be good for us to have a Board Review.” The key, counsels Tillmanns, is to “use an independent mechanism”.

 
 

The conclusion amongst our interviewees is that board development and renewal can be hard because of the level of passion, time, and commitment people have given to the organisation. Change, however, is not personal. As Bishop puts it, the truth is simply that – for social purpose organisations today, “where we are going, is not where we have been.”

 

A simple reflection exercise:
Measure how much of your board time is spent on governance versus leadership as a proportion. You can do this by looking at board agendas and calculating the amount of time spent in meetings on each. If you aren’t spending 50% of your time on the tasks of leadership, consider what it would take to move in this direction.

 

 


 

Elise Sernik will be speaking at the Better Boards Conference 2015, 24-26 July at the Brisbane Convention and Exhibition Centre. Her presentation is entitled “From Governing to Leadership: The Pivotal Shift” Register now.

About Elise Sernik

Elise Sernik is the Executive Director and Founder of Leadership Space. Elise launched Leadership Space to assist social purpose leaders, and executive and Board teams to succeed in times of change. Elise draws on a deep and varied knowledge and expertise base that is a product of a 20-year career in the commercial and social purpose sectors in Australia and globally. Leadership Space works with some of the most well known names in the sector, as well as social entrepreneurs, and innovative change agents across the commercial-social purpose spectrum. Their vision is a thriving social purpose economy.
 
Melissa Macpherson is Executive Director at People for Purpose. Melissa co-founded People for Purpose to provide a platform to enable professionals to contribute towards improved, and more sustainable social outcomes. People for Purpose support the search, placement and development of professionals in leadership and board positions who strive to create positive social impact.

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