Eliminating the Nonprofit Board’s Addiction to Micromanaging
By: Eugene Fram
Micromanaging is the DNA of many nonprofit boards. It all starts with the community model culture of start-up periods. Board members have to assume staff roles to drive the nonprofit operations. But it often continues long after an adequate staff is in place. By habit, the board still focuses on operational details—also known as “reviewing the weeds.” I recently observed a board that was making a policy decision about the change in timing of an annual development event. Once the decision was made, the directors continued a “weed type” discussion about about table locations, invitations and other issues that were in the job of management to implement. The nonprofit is about 50 years old and has a budget of $10 Million with a 100 person staff.
The Community vs. Policy/Strategy Model of Governance.
- Moving from the community model to the policy/strategy model of governance has to result in more delegation of powers to the CEO—this needs to be handled with care. Both board and staff have become acclimated to a duplicative process of keeping the board involved with operational minutiae as described in the example above. Although pledging to become a policy/strategy board, operational minutiae keep filling meeting agendas.
- Not all board members will welcome the move because it takes them out of their comfort zone for this organization or the experiences they have had in similar nonprofits. A few board members may resign when the change takes place. I observed, two board members resigning because the CEO was given full responsibility for staff evaluations—the board previously had been directly involved!
- The CEO, the board chair and three or four influential board members need to be willing to guide the move and to enlist other directors by demonstrating financial and efficiency benefits derived through the elimination of duplicative micromanaging processes.
- Although a board decision, the executive director also will need to apprise the staff how the change will make their work less cumbersome and improve the processes to achieve the agency’s mission.
Some suggestions for initiating the change
- Define, in the bylaws, the CEO operational responsibilities and policy/strategy decisions reserved for the board. This can be done in detail covering as many topics as possible and then adding to these, when new precedents are encountered. An alternative and more efficient method is to broadly define the board powers. They can be modified when the board inadvertently attempts to micromanage the staff or the CEO may assume policy/strategy responsibilities.
- The board chair and CEO will have to carefully review agenda items to make certain they are mission oriented, focusing on policy/strategy topics.
- When a board meeting discussion becomes side tracked into the “operational weeds,” the chair has an obligation to note the situation and to restore proper focus. Through this repetitive process, both veteran directors and those new to corporate governance will begin to view the model’s efficiency.
- To demonstrate the board’s commitment to the change, it is advisable a year or two into the process to make the following changes to clarify managerial titles. to formally recognize the new role of the CEO. *
- The volunteer president becomes board chair. This also eliminates the possibility of the volunteer having some financial liabilities not incumbent on other directors.
- Executive director/CEO becomes president/CEO
- All persons reporting to the president/CEO become vice presidents with several having more responsibilities being named senior vice presidents.
Effort to eliminate vestiges of start-up board micromanaging?
None of these implementing changes take place over night without some mishaps, but boards and management who understand the change process can manage them without rancor and establish a governance model with a partnership/ trusting culture that can endure for decades. Here is one example:
The nonprofit governance model outlined in Policy Vs. Paper Clips (https://goo.gl/j4EK5) has served my organization extremely well for more than two and a half decades. Our Board governance structure has made possible to recruit highly qualified directors and make several bold decisions that have changed the trajectory of our organization.
Thirty years ago I was a brand new leader of a not for profit agency in Rochester NY with an annual budget of $5M and 160 employees who served 800 clients a year throughout 5 counties. Today, I am still the CEO; however it is a very different agency, with a budget of 37M and 800 employees with 150,000 clients served annually
Here’s why I think the model has been so powerful for us:
- The basic premise that the Board and CEO are partners who mutually respect each other’s roles is paramount to our success.
- The Executive Committee serves as the “steering committee” and sets the Board’s annual agenda and priorities, and fulfills the key role of being the CEO’s “sounding board.”
- Our lean committee structure (Assessment & Planning and Resources) allows for substantive discussion on important issues. Board members who aren’t officers have only one commitment and can devote both time and attention to their committee’s mission.
- As CEO, I work very closely with the Executive Committee to ensure the right leadership is selected to serve in officer roles. The Executive Committee also provides “succession” for senior Board leadership. .
I’ve lived the model for a very long time and happily attest that it works!
Gidget Hopf, Ed.D, is President and CEO of Goodwill of the Finger Lakes and its affiliate The Association for the Blind and Visually Impaired-Goodwill Industries of Greater Rochester