This post has been adapted from an article that originally appeared in the Spring 2018 edition of the Association Forum’s “CEOnly Newsletter.” It is reprinted here with the Forum’s permission.
Satisfied Owners Make Better Partners
Thirty years of working with public and nonprofit boards of all shapes and sizes and their chief executives have taught me that your long-term success and professional longevity as CEO of your transit authority have more to do with maintaining a healthy partnership with your board than any other factor. I’ve also learned that even if your transit authority is thriving in terms of operational performance, funding, and public support, and you are turning in a stellar performance as CEO, your partnership with the board isn’t likely to withstand the inevitable stresses and strains at the top unless your board members are really satisfied with – and feel like strong owners of – their governing work. Over the years I’d say that for every CEO I’ve seen run into trouble with her board because of organizational performance shortfalls, I’ve probably seen five whose partnership with the board has eroded because of dissatisfied board members who don’t really own their governing work.
Unfortunately, in my experience, it’s not uncommon for transit authority CEOs to pay far too little attention to fostering feelings of ownership and satisfaction among their board members. One of the questions I always ask board members in one-on-one interviews preparing for an upcoming board-CEO retreat is: “How would you assess your experience as a member of this board?” I’m no longer surprised to hear responses like these, which I’ve taken from the notes of interviews I conducted a few months ago for an upcoming board governance retreat: “I can’t say I feel very engaged.” “I don’t think I’m making much of a difference.” “There must be more to life on this board than thumbing through a huge pile of paper before every board meeting.” “We mainly sit and listen to staff reports in board meetings – boring!” Negative testimony like this – indicative of disengaged board members who don’t feel like owners – is a sure-fire sign of an endangered board-CEO partnership.
Structure Key to Active Engagement
So what can you, as a CEO, do to transform your board members into the kind of satisfied owners who make for supportive and reliable partners? The key is active, meaningful board member engagement in shaping the governing decisions and judgments that make up their governing work. In this regard experience has taught me that your highest-impact strategy is – wearing what I think of as your “Chief Governing Architect” hat – to collaborate closely with your board chair and other officers in putting in place a governing structure of well-designed board committees and pairing these committees with well-designed processes aimed at actively engaging board members. Board standing committees have proved to be very effective vehicles for transforming board members into satisfied owners – and hence more reliable partners for the CEO – by actively engaging them in shaping their governing decisions and judgments.
But committees can function as powerful governing engines and partnership building vehicles only if they are well-designed. In a nutshell, well-designed standing committees are aligned with the major streams of decisions and judgments that make up a board’s governing work, and cut across all of your transit authority’s operations, services, and functions, for example: strategic and operational planning (including budget preparation); performance oversight and monitoring (including updating operating policies as necessary); and external/stakeholder relations.
Well-designed Committees in Action
The following three real-life examples of well-designed board committees in action illustrate how effective well-designed committees can be as vehicles for meaningful board member engagement.
I sat in on the board meeting of a transit authority several months ago that vividly demonstrated how a committee can foster board member ownership and satisfaction. This board’s planning and development committee had followed up on an intensive strategic planning retreat seven months earlier by working closely with the CEO and executive team members in refining the values and vision statements that’d been brainstormed in the retreat, analyzing a number of innovation opportunities that’d been identified in the retreat, and selecting three “strategic innovation initiatives” to be fleshed out by task forces after the board’s approval of the initiatives
Not only had members of this planning and development committee played an active role in shaping the values and vision statements and coming up with the recommended innovation initiatives, the chair and members of the committee carried the presentation ball at the board meeting. Without question, they were in command of the content – really owned it – and thoroughly enjoyed taking the lead in the board meeting. I was struck by the tremendous energy in the boardroom during the presentation and discussion. These were anything but passive audience members being talked to. Not surprisingly, as I later learned, the board-CEO partnership in this transit authority was rock-solid – and remains so today so far as I can tell.
The CEO and CFO of another transit authority worked closely with the members of the board’s performance monitoring committee in re-designing the transit authority’s quarterly financial report to make it easier to understand. The new summary report that the committee chair presented at the regular board business meeting employed bar charts (on PowerPoint slides) comparing actual to budgeted expenditures by major cost centers – for the current quarter and year to date. Although the committee chair felt free to turn to the CFO to address certain questions from her board colleagues, she was so well-prepared that she was able to handle the great majority of the questions. And the external/member relations committee of this transit authority’s board actively involved committee members in identifying critical stakeholder organizations with which it made sense to build and maintain a close ongoing relationship and in working with the director of external relations in hammering out a detailed stakeholder relations strategy.
Beware of “Silo” Committees
By contrast with the well-designed committees in these examples, poorly designed, so-called “silo” committees corresponding to narrow administrative functions (e.g., personnel management; finance) and to particular transit authority functions (e.g., bus operations; rail operations; paratransit) are useless as vehicles for engaging board members in doing important governing work. They actually invite board members to become micro-managers and technical advisers, rather than high-level governors. For example, a personnel committee will get board members involved in the nuts and bolts activities of human resource management; a bus operations committee will immerse board members in the nuts and bolts details of managing – not governing – a line function. A finance committee will get board members involved in the details of financial management. Etc. These processes might very well transform board members into owners – but of executive and administrative – not governing – work!
Other Additions to Your Partnership Tool Kit
Although putting a well-designed board standing committee structure in place is easily the most important step you can take to transform board members into satisfied owners of their governing work – and, hence, into reliable partners – adopting the following committee operating guidelines will make the committees even stronger partnership builders:
- Require that all committee progress reports and action recommendations are presented by committee chairs and members at regular board business meetings – as a means to strengthen committee legitimacy while providing committee members with recognition and ego satisfaction.
- Ensure that committee chairs and members are regularly rotated – as a means to widen board members’ ownership of their governing work while also ensuring they understand the full range of governing functions.
Finally, making sure your board chair is in your corner – as your close ally and advocate – will help you build and maintain a close, positive and productive partnership with your board. In this regard, one of the tools I’ve seen work well is to go out of your way to provide your chair with what I think of as non-monetary compensation, for example: ensuring that your chair succeeds in leading board deliberations, by briefing her in detail before every board meeting; providing her with recognition, such as featuring her work in podcasts and in appropriate publications; and helping her achieve professional goals, such as tossing speaking opportunities her way so she can sharpen her platform skills. Of course, making sure your chair is handsomely “paid” with non-monetary currency requires that you make a point of getting very well acquainted your chair as early in her tenure as possible, and preferably before she assumes the chair.