The 75% Solution: Board Orientation, Board Capabilities, and Board Effectiveness
At a time when associations face significant challenges in revenue generation, volunteer time, resource allocation, and member engagement, it is more important than ever that boards perform effectively. Unfortunately, there is a lot of evidence to suggest that underperforming boards are distressingly common and have significant consequences on the financial performance of associations, as well as staff and board morale.
However, there are ways to avoid this. An effective board orientation is a great way to avoid the costs and headaches associated with an underperforming board. Now, you and I know that while the association literature is full of recommendations for best practices, often these “best practices” are not supported by empirical data. Yet, that is not the case regarding the effectiveness of Board orientation.
For example, Leading with Intent: 2017 National Index of Nonprofit Board Practices is a BoardSource publication based on survey data from more than 1,300 not-for-profit organizations. When asked what impact their board has on the overall effectiveness of their organization’s performance, 93% of board chairs and 81% of chief staff executives replied “very positive impact” or “somewhat positive impact.” Furthermore, those boards rated as having a positive impact on organizational performance also have a strong understanding of their roles and responsibilities; those that have a negative impact on organizational performance are much more likely to have a weak understanding of their roles and responsibilities. Good boards understand their roles: “For any board to work effectively, it must be clear about what the work is. The data demonstrate that a board’s understanding of its roles and responsibilities relates to strong board performance in other areas and the perceptions of the board’s impact on organizational performance.”1
In a different study, William Brown surveyed more than 1,000 CEOs and board chairs representing more than 700 not-for-profit credit unions. He found that a best practice orientation had a significant positive effect on whether board members were perceived as highly competent. In addition, he discovered a significant positive relationship between orientation and board performance. Board orientation didn’t just lead to more capable board members; it also led directly to more effective boards. The two variables of board member competencies and board orientation together accounted for more than 75% of the variance in board performance. Not a bad return on investment for the 3-4 hours needed per year for a solid board orientation.
Green and Griesinger (1996) also found several significant correlations with organizational effectiveness for many board activities, particularly those in the areas of strategic planning, board development, resources development, financial planning, and conflict resolution. The activity most correlated with organizational effectiveness, however, was providing training for new board members.
So, given the empirical evidence that clearly demonstrates the positive effects of an effective board orientation, surely by now associations have mastered, or at least refined, these practices. Nope.
According to a 2017 survey from Heidrick & Struggles, less than half of respondents (45%) said their organization's onboarding experience properly prepared them to be an effective board member, while slightly more than half (53%) had experienced a defined onboarding process when they first joined the board of directors. Furthermore, just one-third of incoming board members received an explanation about how the board evaluates the CEO or executive director, and 40% didn't receive an explanation of internal organization staffing.
So, we need to do better. Don’t underestimate the power of a good board orientation. Spend 2-4 hours helping your board understand what they need to do, what they should do, and why they should do it. Whether it’s you or an independent consultant, an effective board orientation can be fun, productive, and pay dividends down the road.
What makes a good Board orientation? I’m so glad you asked. Watch out for more blog posts for some ideas!
- “Leading With Intent: 2017 National Index of Nonprofit Board Practices”, p. 47.
Dave Bergeson serves as vice president of client relations on AMC’s Leadership Team and is the executive director for the Association of Pediatric Hematology/Oncology Nurses.
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