Useful Past Tips: BOARDS: Getting The Most From It Involving Youth Hand-And-Hand Meeting -- Run It Right Giving and Getting Dollars Facing The Future Cut Them Loose Nominating the best board Getting members to perform Getting youth involved True leadership brings success Trustee ability You have to pay to play Evaluating who stays or goes Getting the most from directors Meetings when you can't be face-to-face Set a budget for the executive search process Issues, Opportunities Getting businesses to get involved Reorganization Tackling organizational change Change is inevitable, manage it Deciding about your chief executive Getting things back on track

1. Getting The Most From It

Getting the maximum performance out of board members can often be difficult, especially if you have 30 or 40 members to evaluate.

So, having policies and procedures in place to help weed out those not performing and rejuvenating those who need a kick in the pants is key to developing a top-notch board.

Here are a few tips in dealing with underachieving board members:

• Use the regular nominating process to ask all board members whether they want to remain on the board. Don't assume that you have to wait until a board member's term is up to ask if that person wants to continue.
• Take advantage of opportunities for board renewal. Consider the possibility that poor group dynamics, lagging energy or burnout experienced by the board as a group contributes to the inactivity and lethargy of some members. A board self-assessment or planning retreat can provide an opportunity to re-connect with mission and strengthen relationships within the group.
• Don't assume that the performance of individual board members can't change -- or that it won't change over time. A new project or a new committee assignment may energize a slacking board member.

2. Involving Youth

How can nonprofits comfortably introduce youth to power positions within their organization? Boston-based Youth on Boards offers suggestions pulled from 14 Points: Successfully Involving Youth in Decision Making.

• Know why you want to involve young people. There are several motivations for involving young people in governance structure, but each board must reflect on its own organizational interests and goals.
• Identify potential barriers from individuals, the organizational culture, and the organization's own bylaws.
• Address legal issues. Take proactive measures to protect against potential liability.
• Conduct intergenerational training. Recognize that young people and adults may not be used to working on equal ground with one another. A training module may help sharpen skills in the areas of relationship building, communicating, and listening.
• Support and develop young leaders. Your organization can adopt strategies that help young leaders by helping them deal with outside forces and enabling them to network with each other.

3. Hand-And-Hand

Boards need to work more hand-and-hand with their nonprofit executives to face the challenges of today.

The old style, of boards setting policy and management implementing it with territories sharply defined within the organizational chart, is over. The new way has the board and management focusing on the issues and trying to solve problems together -- instead of management defining and solving problems with the board listening in.

Here is a list of new model ingredients:

• Board and management set and employ policy with organizational lines being blurred;
• Have the board evaluate a common mission. Make sure that each member articulates the same tone about the mission;
• Communication -- once a common vision is established, the organization has to decide how to communicate it.
• Use member's skills through an agreed-upon agenda;
• The goal should be to have an open and inclusive management style.

4. Meeting -- Run It Right

Board meetings are being conducted via satellite communication where board members can be in various locations and still conduct the nonprofit's business.

Although technology makes meetings possible, there are still 10 effective board meeting tips that Washington, D.C.-based BoardSource believes can help nonprofits run smooth meetings, whether they be the cyberspace or regular roundtable variety.

• Agree on the organization's mission.
• Clearly define desired outcomes.
• Ensure that everybody is talking about the same thing at the same time.
• Require advance reading.
• Place time limits on the agenda -- and stick to them.
• Block out dates for future meetings for one year.
• Involve all of the board members.
• Remember confidentiality rules.
• Elect an unofficial sergeant at arms.
• Meet in executive session several times a year, without the chief executive officer.

5. Giving and Getting Dollars

A healthy number of nonprofit boards require members to "give or get" a certain dollar figure annually as part of their duties. But, many are still reluctant to be up front with possible board members about monetary responsibilities.

According to a survey conducted by Washington, D.C.-based BoardSource, some 47 percent of organizations reported requiring board members to make annual monetary contributions.

Those organizations not requiring board members to "give or get" may want to heed these suggestions, while those that use the formula can get a refresher.

• Board members should give depending on their own means;

• Give possible board members a job description up front -- including financial responsibilities;

• A board member's connection to colleagues and friends is vital because they donate to the cause;

• The give or get amount should reflect size of organization; and

• Hold annual events where board members invite friends who spend money while spending money themselves.

6. Facing The Future

Here are conservative predictions that nonprofit executives and board members should consider as they prepare for governance in the new millennium.

• Board diversity will become a strategic imperative. As baby boomers move toward retirement and white Americans become a minority, or at least not a majority, in many more communities, the strategic value of board diversity will become more obvious.
• Boards will become more systematic and deliberate about the nominating process. The traditional "draw on friends/colleagues" method will become increasingly inadequate as organizations become more complex and communities more diverse.
• Technology will help boards work smarter. Technology keeps board members informed, involved and engaged. Board members take advantage of email and instantaneous access to information and additional opportunities for conversation and interaction.
• Boards will gravitate toward more meaningful work. Board members are eager to engage in activities that are manageable, clearly defined, and that allow them to make a contribution.
• Community will become increasingly important. Board service offers opportunity for satisfying human interaction with a community of people who share common values.

7. Cut Them Loose

Cutting deadwood from your board can become a problem if you let it. Having procedures and strategies in place can help you when evaluating board members and getting rid of loafers. Here are some good strategies to follow when trimming the deadwood from your board:

• Term limits. Consider limiting the number of terms a board member can serve -- two/three-year terms is a common practice.
• Adopt an attendance policy. State in bylaws/policy that members who miss more than two consecutive meetings without extenuating circumstances will be removed.
• Encourage board members to engage in an annual or periodic self-evaluation. It doesn't need to be elaborate -- a simple, one-page self-evaluation form can serve as a subtle reminder of expectations.
• Use advisory committees, task forces, and other special groups. Keep members engaged by asking them to join a task force or advisory group.
• Consider board restructuring. You can infuse new energy by increasing the size of the board, or you can use downsizing as an opportunity to lop off slackers.

8. Nominating the best board

Your board's nominating committee is its most important collection of people. While many nonprofit executives know this to be true, many haven't set up procedures to effectively utilize the committee.

Using a nominating committee is the best way to recruit the top-notch board members. And, implementing a for-profit-like system can be successful.

Here are seven idea that the for-profit world takes for granted, but few nonprofits follow:

1. Rank all candidates on a scale of 1 to 10, with 10 being the highest;
2. Go for the "10s" first;
3. Do your homework on each candidate;
4. Don't exclude a candidate, no matter how busy that candidate may seem;
5. Target people you don't know;
6. Work only by committee. Never let one volunteer recruit alone;
7. Be honest with candidates about the time commitment and workload necessary to do the job.

9. Getting members to perform

Terminating board members who aren't making a contribution or who are not fulfilling your expectations is a problem that a lot of chief executives, board and committee chairpersons face when dealing with slacker members.

A number of boards have some "deadwood" board members, which can take shape in many ways, such as being no shows at board and committee meetings or attending meetings but contribute little or nothing to discussions.

First of all, you should ask yourself why that certain board member isn't performing, and why you consider them valueless.

Here are some questions to ponder when you're dealing with slacking board members. Have you:

• Clearly outlined what you expect from board members, communicating your expectations both in person and in writing?;
• Asked your board members to carry out specific, discrete tasks?;
• Taken time to listen and understand your board members' expectations about their service?;
• Provided the information and support that board members need?

10. Getting youth involved

How can nonprofits comfortably introduce youth to power positions within their organization? Boston-based Youth on Boards offers suggestions pulled from 14 Points: Successfully Involving Youth in Decision Making.

• Know why you want to involve young people. There are several motivations for involving young people in governance structure, but each board must reflect on its own organizational interests and goals.
• Identify potential barriers from individuals, the organizational culture, and the organization’s own bylaws.
• Address legal issues. Take proactive measures to protect against potential liability.
• Conduct intergenerational training. Recognize that young people and adults may not be used to working on equal ground with one another. A training module may help sharpen skills in the areas of relationship building, communicating, and listening.
• Support and develop young leaders. Your organization can adopt strategies that help young leader by helping them deal with outside forces and enabling them to network with each other.
  

11. True leadership brings success

The board can be the backbone of any nonprofit, and the makeup of a board can go a long way in determining the success of the organization. Simone P. Joyaux of Joyaux Associates, speaking at an international conference on fundraising, offered a sample policy for developing the optimum board of directors.

Joyaux mentioned certain attributes or qualities that an organization looks for in each board member. Board members are expected to affirm and demonstrate the following:

• Dedication to the values, mission and vision of the organization.
• Courtesy, honesty and integrity.
• Candid dialogue.Behaving as a team player and participating in the group that is the board.
• Expressing individual opinions and perspective balanced with supporting group decisions.
• Asking difficult questions without being overzealous.
• Being comfortable with diversity and agreeing to disagree.
• Accepting that disagreement and conflict are part of doing the organization's business well and working with colleagues to resolve differences.
• Bringing issues to the boardroom and discouraging behind-the-scenes conversation that creates divisiveness.

• Financial expertise
• Investment experience
• Fundraising experience
• Legal expertise
• Property and facility management and construction
• Marketing
• Small business experience
• Personnel experience
• Not-for-profit management and governance

In addition, Joyaux urged avoidance of functional silos on the board - that is, isolating an individual in one skill area serves neither the organization nor the board well.

12. Trustee ability

The trustees of a charitable organization generally have some ability to determine who their stakeholders are and what the stakeholders' interests may be in addition to fundamental fiduciary responsibility. The trustees then have the responsibility of balancing those interests, according to Frank L. Ellsworth and Joe Lumarda in their book Foundation Management: Innovation and Responsibility at Home and Abroad.

Subject to legal requirements such as the minimum 5 percent payout and excise tax, or others, which also tend to be contingent in nature, such as some percentage of an account balance on a certain date, the trustees have the ability to do the following:

The discretionary status of the funds, which rests with the trustees in grantmaking foundations.

The balance between future and current expenditures, and a baseline for what constitutes stability. This tends to be a delicate balance between current operations and the proposed growth rate of operations in an operating foundation.

The tradeoffs to be made between operating expenses versus capital expenditures. These typically can be reallocated and either slowed or accelerated at the trustees' discretion, at least within limits.

By way of contrast, the largest institutional funds, at least in the United States, can be broken down between defined benefit plans and defined contribution plans. Both are retirement benefit structures governed by the Employee Retirement Income Security Act.

13. You have to pay to play

A healthy number of nonprofit boards require members to "give or get" a certain dollar figure annually as part of their duties. But, many are still reluctant to be up front with possible board members about monetary responsibilities.

According to a survey conducted by Washington, D.C.-based BoardSource, some 47 percent of organizations reported requiring board members to make annual monetary contributions.

Those organizations not requiring board members to "give or get" may want to heed these suggestions, while those that use the formula can get a refresher.

• Board members should give depending on their own means;

• Give possible board members a job description up front -- including financial responsibilities;

• A board member's connection to colleagues and friends is vital because they donate to the cause;

• The give or get amount should reflect size of organization; and

• Hold annual events where board members invite friends who spend money while spending money themselves.

14. Evaluating who stays or goes

Getting the maximum performance out of board members can often be difficult, especially if you have 30 or 40 members to evaluate. Therefore, having policies and procedures in place to help weed out those not performing and rejuvenating those who need a kick in the pants is key to developing a top notch board.

Here are few tips in dealing with underachieving board members:

• Use the regular nominating process to ask all board members whether they want to remain on the board. Don't assume that you have to wait until a board member's term is up to ask if that person wants to continue.

• Take advantage of opportunities for board renewal. Consider the possibility that poor group dynamics, lagging energy or burnout experienced by the board as a group contributes to the inactivity and lethargy of some members. A board self-assessment or planning retreat can provide an opportunity to re-connect with mission and strengthen relationships within the group.

• Don't assume that the performance of individual board members can't change -- or that it won't change over time. A new project or a new committee assignment may energize a slacking board member.

15. Getting the most from directors

Cutting deadwood from your board can become a problem if you let it. Having procedures and strategies in place can help you when evaluating board members and getting rid of loafers. Here are some good strategies to follow when trimming the deadwood from your board:

• Term limits. Consider limiting the number of terms a board member can serve -- two, three-year terms is a common practice.

• Adopt an attendance policy. State in bylaws/policy that members who miss more than two consecutive meetings without extenuating circumstances will be removed.

• Encourage board members to engage in an annual or periodic self-evaluation. It doesn't need to be elaborate -- a simple, one-page self-evaluation form can serve as a subtle reminder of expectations.

• Use advisory committees, task forces, and other special groups. Keep members engaged by asking them to join a task force or advisory group.

• Consider board restructuring. You can infuse new energy by increasing the size of the board, or you can use downsizing as an opportunity to lop off slackers.

Here are few tips in dealing with underachieving board members:

• Use the regular nominating process to ask all board members whether they want to remain on the board. Don't assume that you have to wait until a board member's term is up to ask if that person wants to continue.

• Take advantage of opportunities for board renewal. Consider the possibility that poor group dynamics, lagging energy or burnout experienced by the board as a group contributes to the inactivity and lethargy of some members. A board self-assessment or planning retreat can provide an opportunity to re-connect with mission and strengthen relationships within the group.

• Don't assume that the performance of individual board members can't change -- or that it won't change over time. A new project or a new committee assignment may energize a slacking board member.

16. Meetings when you can't be face-to-face

Board meetings are being conducted via satellite communication where board members can be in various locations and still conduct the nonprofit's business.

While technology makes meetings possible, there are still 10 effective board meeting tips that Washington, D.C.-based BoardSource believes can help nonprofits run smooth meetings, whether they be the cyberspace or regular roundtable variety.

• Agree on the organization's mission.

• Clearly define desired outcomes.

• Ensure that everybody is talking about the same thing at the same time.

• Require advance reading.

• Place time limits on the agenda -- and stick to them.

• Block out dates for future meetings for one year.

• Involve all of the board members.

• Remember confidentiality rules.

• Elect an unofficial sergeant at arms.

• Meet in executive session several times a year, without the chief executive officer.

17. Set a budget for the executive search process

During those times when it becomes necessary to undertake an executive search, there are many considerations that must be recognized. In their book Losing Your Executive Director Without Losing Your Way, Carol Weisman and Richard I. Goldbaum recommend the proposal of a budget for the search. This budget should be presented to the board for approval, and it must include the following items:

• Advertising. This can include the cost of posting job announcements in local or city-wide newspapers or professional and trade publications and on the Web, as well as printing flyers to be sent to various service and professional organizations.

• Long distance telephone calls and faxes. These might be necessary to talk with both candidates and their references.

• Travel. If any of the final candidates live out of town, the organization may want to offer to cover the cost of travel, lodging and meals for those candidates who are asked to return for the final round of interviews.

• Relocation costs. The board might include as part of the negotiated compensation package payment for all or part of moving expenses for the new executive director if that individual lives out of town.

• Search firm. Committee members might want to conduct the search themselves or hire an executive search firm. If a firm is hired, that cost must be included in the budget as another line item.

18. Issues, Opportunities

Conflicts between goals and policies can create ongoing tension between board and staff members when creating an endowment spending policy. These decisions are inherently difficult, interactive and relatively continuous in nature.

According to Russell T. Hill and Craig T. Cross in their chapter on investing in the book Foundation Management (2003, Wiley), potential economic and institutional objectives that may result in trade-offs include the following:

• Maximize long-term total return. Implies smaller distributions for current institutional objectives and a higher-risk investment policy;
• Maximize annual spending. Implies penalizing future generations and growth of programs that may be unacceptable to the board or staff;
• Maximize present value of spending. Could be read as the same as annual spending, but it really is a balancing act between total return and annual spending;
• Preserve wealth and purchasing power. Places maximum restraints on distributions, which are limited to long-term, real(inflation adjusted) earnings;
• Maximize or optimize stability and predictability of spending. Typically, long term total return should be moderated in order to optimize stability and predictability.

In addition to internal conflicts, the capital markets themselves cause tradeoff-related tensions:

• The level of expected return is inversely correlated with the predictability of that return;
• Purchasing power vs. stability;
• Annual spending vs. long-run wealth.

19. Getting businesses to get involved

The many challenges facing nonprofits and the benefits that businesses can derive from nonprofit involvement can work to the advantage of both. Nonprofits can help themselves by securing knowledgeable business people for their boards.

This can be done effectively by understanding the key motivators that will entice members of the business community to join.

Among the motivators:

• Developing leadership. Businesses seek ways to identify, develop and groom younger middle-level and upper-level managers for higher leadership roles in the company. Board members who succeed in completing a project for a nonprofit, especially a difficult or complicated one, gain experience and confidence.
• Enhancing team building. Teams of volunteers bond in new and different ways when they have been on a project for a long time. Often, the leaders who emerge on the volunteer project are not the leaders in the office.
• Fostering loyalty to the company. Employees feel good about their employer when the company shows a commitment to the community.
• Building visibility and good will. Individuals generate good will for their companies and give businesses a human face.
• Improving the quality of life in the community. Businesses depend on a healthy local economy to succeed. Employers need an educated work force, a healthy community and good daycare and education for the children of workers.

20. Reorganization

Organizations have to figure out who moved their cheese from time to time. The best-selling book, Who Moved My Cheese, written by Dr. Spencer Johnson, is a short story of how to embrace change.

John Courtney, former chief staff officer with American Diabetes Association, presented several things to keep in mind when undergoing reorganization during a recent nonprofit accounting conference.

First ask the right questions, Courtney suggested.

• Who will be our customers in five years?
• Who are our competitors?
• What's our competitive advantage?
• What's our capacity for growth?
• Do facilities support our strategic objectives?

Courtney pointed out that planned change begins with an understanding of the need to change, a vision of how the change will be better, and how the it will impact individuals.

Courtney explained that a change could improve the organization if:

• There's more impact on mission-related activities.
• It positions the organization for future success.
• Leaders are committed to making the change process successful.
• Leaders commit to communicate the vision, progress and problems.

Managing the constituencies impacted by change is also a facet to consider, according to Courtney.

• Involve the right people;
• Get the right information;
• Be prepared;
• Use retreats and meeting for the "right" reasons;
• Reach, stretch, challenge.

During the process remember to identify the biggest issues with the most potential for impact and take them brick by brick, according to Courtney. Remain focused on the few high-impact opportunities rather than looking at what is easiest, according to Courtney.

21. Tackling organizational change

Change is not easy. But, standing still can be more dangerous to the health of your organization. John Courtney, former chief staff officer with American Diabetes Association, presented several steps to tackling organizational change during a recent American Institute of Certified Public Accountants nonprofit conference.

Here are a few questions to ask to lay the groundwork for change, according to Courtney.

• What are the strategic issues facing the organization?
  
  
• What are our organization's core competencies?
  
  
• What makes us different from other organizations?
  
  
• What are our greatest opportunities and threats?

When asking about the key strategic issues focus on mission, purpose, and outcomes of the organizations, according to Courtney.

• Do you have quality people?
  
  
• Do you have a strategic plan?
  
  
• Is there consensus on these issues?

When thinking about core competencies and what separates your organization consider these questions, according to Courtney.

• What are we doing?
  
  
• What impact are we having?
  
  
• Are we measuring and reporting our outcomes?
  
  
• Can we do better?

Think about the following questions when determining greatest threats and opportunities, according to Courtney.

• How are we monitoring opportunities and threats?
  
  
• Are we making sure the information is shared with the organization?

22. Change is inevitable, manage it

It is no surprise to most people in the nonprofit world that there have been changes over time. The nature and scope of needs, organizational structure, public perception of philanthropies, all have undergone some kind of alteration.

In their book Governance as Leadership, Richard P. Chait, William P. Ryan and Barbara E. Taylor maintain that there have actually been five clear-cut areas of change in the nonprofit world since the 1970s. These areas have had a profound effect on the nonprofit picture, they contend.

• Demand for the services of some nonprofits declined. For instance, private colleges confronted stiff competition from lower-priced public institutions, and even from for-profit educational institutions. Hospitals were saddled with empty beds and budget deficits because of cutbacks in insurance reimbursements and the growth of outpatient treatment.
  
  
• Arts organizations, from orchestras to museums, simultaneously encountered a bevy of challenges: resistance to expensive tickets, distaste for modern genres, unfavorable demographics and competition from popular culture.
  
  
• Nonprofits became subject to external ratings. The comparative data enlightened consumers, shaped public perceptions and prodded administrators to be more responsive to consumer concerns.
  
  
• Government agencies, foundations and philanthropists started to treat grants to nonprofits more like investments than gifts. Resource providers wanted objective assurance that allocations to one organization would yield a higher rate of social return than to another.
  
  
• With more information available about nonprofit performance, competition for personnel intensified as well. A high-performing organization could attract better staff than a low-rated one.

23. Deciding about your chief executive

In the overall operation of a nonprofit organization, one area that can be overlooked is that of assessment of the chief executive. An evaluation gives the board a chance to clarify expectations for the chief executive, as well as a chance to say "Well done" for a good performance.

In Assessment of the Chief Executive Joshua Mintz and Jane Pierson present several checklists of performance assessment criteria that they say should be utilized by the board.

These lists cover a wide range of concerns, including basic abilities and skill in interacting with the board and the general public.

Following are some of the criteria that Mintz and Pireson stress:

Under core competencies:

• In collaboration with the board, articulated a clear vision for the future of the organization.
  
  
• Used the mission of the organization as a guide in making decisions.
  
  
• Engaged the board in meaningful strategic thinking about the organization.
  
  
• Developed appropriate goals and objectives to advance the mission.
  
  
• Effectively led the staff in implementing strategic objectives and annual goals.

Under administration:

• Displayed a thorough knowledge of the organization's mission area and programs.
  
  
• Managed the organization efficiently on a day-to-day basis.
  
  
• Managed the successful delivery of programs.
  
  
• Recruited, developed and retained the staff needed to implement the annual work plan.
  
  
• Minimized risk by ensuring that appropriate policies and procedures are in place.
  
  
• Ensured compliance with legal and regulatory requirements.

24. Getting things back on track

Although nobody likes to think about disasters, they are a fact of life, and nonprofits must be prepared for them if they are to fulfill their mission. This reality was addressed in a booklet released by BDO Seidman's Institute for Non Profit Excellence, titled Disaster Preparedness and Recovery: A Guide for Nonprofit Board Members and Executives.

According to the guide, part of the fiduciary responsibility for sound management of an organization includes three main items:

• Anticipating and planning for disasters that might affect the organization
  
  
• Doing as much as possible in advance to mitigate the effects of a potential disaster
  
  
• Putting things back in order as quickly as possible after a disaster strikes.

Generally, disasters affect five key areas of nonprofits: people, operations, facilities, finances and spillover effects from something that has affected some other person or organization.

Preparedness for disaster involves two main categories: preparation and prevention. Preparation usually involves general measures in order to minimize the effects of disaster, imagining scenarios that could happen; prevention entails specific steps to ward off a certain type of problem.

The guide recommends drawing up a disaster plan that includes several lists and charts: of possible disasters (which may vary depending on location or type of activity), activities it is important for the organization to maintain (and people responsible for them), persons in charge of disaster response equipment and suppliers and backup facilities.

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