Building a Powerhouse Board of Directors

Grazing over my emails a few months back, I came across a press release with an intriguing headline: “Atherio Creates a Powerhouse Board of Directors.” Frankly, there hasn’t been enough time since I first discovered Atherio­—a Florida-based global technology services company—to judge whether its new “powerhouse” board of directors has actually made a difference. But that word led me to think about how nonprofit associations might build their own powerhouse or high-performance boards. I thought it would be constructive to check in with several trusted association colleagues to determine what, in their opinion, makes for a turbo-charged powerhouse board.

Size and Management. Dave Fellers, CAE, has served three national medical societies and two state associations in the oil marketing industry. Today he is a consultant to dozens of groups. Fellers believes a powerhouse board must be “effective, focused on strategies and future vision. It allows staff to implement. And there must be a strong bond between the board and staff.” Thinking about his own former boards, Fellers said three of them were too large to be very effective. He thinks the ideal size is between 12 and 14 people. “If it is larger, it becomes very difficult to achieve the kind of personal engagement that distinguishes truly effective boards,” he said. At the two state associations Fellers served—both staff driven and composed of small, family-run businesses—board meetings were more like reunions with lots of fellowship, backslapping and laughs, but very little forward progress. That is, not powerhouse in the least.

The Radiological Society of North America is led by an eight-member board that Fellers believes meets the powerhouse standard. The RSNA, an umbrella organization for more than 51,000 medical members, has an annual trade show and convention that attracts some 60,000 people, and the group’s revenues exceed $85 million a year. To keep things running in the same successful vein, the RSNA board assigns directors to serve as a “portfolio manager,” in charge of one of the association’s key operations. Further, to prevent micromanaging, the board has invested the staff with unambiguous authority to manage and implement policy. The RSNA’s portfolio managers act as a partner, resource and liaison to the staff, board and committees. This highly defined departmental structure creates a management system that doesn’t rely upon one or two individuals to make things work. While the commitment to serve on the board is eight-years—a term that concerns Fellers as too long—he admits that “it seems to work very well for RSNA.”

How can an under-performing board transition into a powerhouse? According to Fellers, there are four key steps:

1. Schedule board development and leadership training sessions. Done properly, directors will embrace these sessions as a perk that polishes their leadership skills.

2. Administer a self-assessment survey each year. (Several good low-cost models are available online.) Results should be analyzed so that action can be taken to enhance any deficiencies.

3. Focus on the competency and expertise of board directors, and make sure they fully understand the nature and scope of the work expected of them.

4. Focus the board’s attention on strategic issues and move away from tactical issues. In addition, a plan containing measurable milestones should be reviewed at each meeting.

The RSNA model of governance clearly wouldn’t work for all associations but it’s an excellent reminder that there are an infinite number of good governance models out there.

Passionate, Skilled and Goal-Oriented Members. Susan Sarfati, CAE, was executive vice-president of the American Society of Association Executives and CEO of the Greater Washington Society of Association Executives (GWSAE) and today is CEO of High Performance Strategies, her own consultancy. According to Sarfati, a powerhouse board is “one that has highly talented members, with the competencies the organization requires at the time, and is open, transparent and quick to make decisions. Most important, the board members have passion for the industry, profession or social cause that they represent and act on that passion.”

Sarfati’s definition contains a reference I find provocative: “competencies the organization requires at the time.” This suggests that associations should be recruiting directors who possess skills that are critical for their current needs. When anticipating a big capital campaign, for example, isn’t it logical to try to recruit directors who actually possess fundraising skills?

James Wilkerson, CAE, vice-president for strategy and growth at the National Foreign Trade Council in Washington, D.C., said that we should “treat every vacancy as an opportunity to improve, not necessarily replace ‘like with like.’” Wilkerson said that before discussing candidates, groups should examine which communities they want to reach. Then leadership should discuss and vet candidates with the full board. Finally, during the invitation process, the board should lay out expectations.

Elements of Governance. I also talked with Stephen Carey, CAE, lead strategist of Association Management & Marketing Resources, located in Bethesda, Maryland. Carey served as CEO of the GWSAE prior to Sarfati. When I asked him to name the characteristics of a powerhouse board of directors, he said that high-performance boards share common characteristics that begin with what he termed “good leadership sense.” Think of it as good common sense except in the context of leadership. Groups with good leadership sense “understand that the board leads and collectively sets the policy for the association. They won’t get involved in the minutiae of committee governance, for example, because that distracts you from the strategic issues,” said Carey, giving an example: “It becomes difficult to think strategically if you are worried about how to plan the annual meeting.”

All elements of basic governance infrastructure must support the board, Carey said. Questions such as how many people should serve on the board and term limits are appropriate policies in place to provide guidance. “All of these must be pretty solid in order to free the board to lead,” he said. Both he and Sarfati also agree that a board must define its role, responsibilities, work methods and ways to resolve conflict, as well as any other governance administration infrastructure, so that it can free itself to focus on issues of strategic importance.

A commonly debated issue is what consists of true board leadership training. Said Carey, “Most will say, ‘Yes, we provide the board with leadership training,’ but in reality, the training only consists of an orientation that directors may receive at the beginning of their term that consists of reviewing lists of committees, key dates, rosters of staff and other types of operational issues.”

More critical leadership training, which most directors do not receive, defines roles and responsibilities and reviews legal concepts such as directors’ obligations under law to the association, antitrust statutes, conflicts of interest—how they arise and how to manage them—and lessons on good leadership.

“A good practice is to conduct a half-day training program for directors annually and to also conduct a special orientation for new directors in order to bring them up to speed with the others,” Carey suggested.

Shared Traits of Strong Boards. While every high-performance board differs from others in many respects, such as its unique culture, mission and work process, they do seem to share certain characteristics:

1. They are smaller insize and thus inherently more efficient.

2. Their governance infrastructure, such as roles,policies and business processes, are well-conceived, in place and followed.

3. Leadership development is provided and practiced regularly.

4. Directors are personally engaged and possess leadership sense.

5. The staff is empowered to implement actions without interference.

6. New directors are recruited for their leadership skills and functional competencies instead of as a reward for years of loyal service.

Most associations will benefit by pausing to consider how their own boards compare in each of these key metrics. Boards that consistently outperform expectations typically lead dynamic, growing and vital organizations. On the flip side, when governance is poor, it is likely that so is everything else in the organization.