Improving Governance Structure and Performance

We tend to think of process improvement as deeply entrenched in the day to day operations of a work group or organization. And with good reason. History has shown there is a lot of room for improvement at this most detailed level of work. Still, that doesn’t mean there aren’t opportunities at other levels as well. And in an organizational hierarchy model, that includes the highest level of all: Governance.

When a Little Improvement Goes a Long Way: You may have thought once or twice that things could be going better with your governing Board. And if you are thinking that way, chances are at least some of the Board members are feeling the same. Now realistically, most Boards I have known do a pretty credible job considering time constraints and the voluntary nature of their role. But that doesn’t mean they couldn’t do better, with better structure, process, and culture. And in some ways, the Board members cast the longest shadows in the organization. That is to say, with their focus and work at the highest policy level of the organization, their performance can ripple though all other levels. If things go well with the Board, it can contribute to better performance in the rest of the organization. And if not?

Building a Better Board: Improving Board performance starts with a clear understanding of the Board’s roles and responsibilities, some of which tend to be more universal while others are likely specific to the industry and organization in question. What must the Board accomplish year to year? How is their role in the organization different from that of management? Once these roles and responsibilities are clearly delineated, a complimentary and enabling Board Structure can be designed, but not before. Form should follow function, with Boards too.

There are often governance improvement opportunities beyond role clarification and structural alignment. How often should the Board meet? How is the agenda determined? How does the Executive Team support the Board in its work? How are Board members replenished as terms expire, and how are officers selected and prepared for their role? There are important processes to consider in the “work” of an effective Board, and as a result, opportunities for improvement.

Measuring Governance: And, as with any other level of the organization, improvement must be measured to be effective. Apart from careful consideration of which organizational performance measures should be linked to Board performance, the Board has at least one other critical measurement opportunity to both gauge current governance improvement efforts and identify new opportunities: the Board Assessment. Given the pace of change challenging their organization (and them), and the regular cycle of Board member turnover, most Boards should consider conducting a Board Assessment annually. The assessment can provide three key types of insight:

1.  Governance perspective on the relative success of both governance work and major organizational initiatives.

2.  Assessment of organizational priorities against the strategic plan on an ongoing basis.

3.  Measurement of current Board Member satisfaction with all aspects of their experience as a member of the Governing body.

Best Practice Governance for a Best Practice Organization: For improvement to flourish as a discipline in an organization, it must proliferate to all levels, including leadership levels. And the governing body is both the foundation and capstone of organizational leadership. The good news is the tenants of improvement, including the pursuit of excellence, are just as applicable at the Governance and Leadership levels of the organization as they are in any of the operating departments. For a great example of this “fit”, check out The Baldrige Influence on Governance, an AHA Trustee Services Publication by Larry Walker and Cindy Fineran. This is a healthcare example, but I believe it has broad applicability to any organization.

Looking for more improvement in your organization? Why not take a look at Governance. Contact me if you would like to talk about how I can help with Governance Assessment, Structure, or Performance Improvement.

Jeff