Now that I have your attention, let me start by saying that I have had the pleasure of working with many nonprofit boards, and find most to be thoughtful, dynamic and well-functioning groups.
But humans are interesting creatures, and when you put us together all sorts of interesting things can happen. The nonprofit board is a structure with many positive features and the best of intentions. Often, it works out just fine. Then there are the exceptions…
In a past blog entry called “The Single Worst Practice” I wrote about a fascinating finding of the three-year applied research project conducted by Public Interest Management Group in partnership with the Nonprofit Association of Oregon and Impact Foundry. The data shows, among many other things, that the least successful nonprofits tend to share an attribute that their most successful peers lack: their boards often played a dominant role in decision-making. I call this “The Over-Engaged Board.”
This finding is striking because it showed up in all three of our cohort groups, and it flies in the face of conventional wisdom that more board engagement is inherently good. Instead, this data suggests that some types of board engagement may be very bad. Further, even arguably “good” types of engagement may not be crucial to success.
Note that this research was exploratory, and deeper study can further illuminate these dynamics. With that caveat, it’s great to start a discussion with research rather than anecdotes, which can, admittedly, be enticing.
I’d like to unpack the apparently “bad” types of board engagement that can hold nonprofits back.
Photo by Daniele Levis Pelusi via Unsplash
In our research we employ a metric called the organizational success index, or OSI, that summarizes a nonprofit’s overall performance at a point in time. It’s a value between 20 and 100. In over 90% of organizations with OSI values below 60, we saw at least one of five common board behaviors, deemed by participating CEOs to present major organizational challenges. Conversely, less than a quarter of those nonprofits with OSI values over 70 showed any of these behaviors:
1. Micromanagement
This is when the board or individual board members closely scrutinize day-to-day work of staff members, often outside the scope established by the bylaws. This behavior was almost never deemed helpful by staff.
2. Small-Picture Focus
Many boards of unsuccessful nonprofits worked on tactical tasks, often to the exclusion of strategic matters such as assessment of the organization’s effectiveness or financial sustainability.
3. Turf Protection
Board members or factions within boards of these organizations often acted to protect pet projects or a power base within the organization, sometimes creating rivalries within the board or between board and staff. Protection of pet projects at times appeared to work counter to what was best for the organization. Factionalization sometimes spilled over to the staff, promoting dissention and undermining morale.
4. Reactionism
A behavior seen in boards of some unsuccessful organizations – but rarely in successful ones – was an undisciplined scope of work that encouraged over-reaction to events, such as external politics, internal personnel matters or intra-board disputes. These cases not only distracted boards from more impactful work, they also produced unintended consequences, such as deepening dissension or harm to the organization’s reputation.
5. Cultural Misalignment
A common, and usually unacknowledged, issue in nonprofits is an internal clash of cultures. This sometimes traced to different social or professional strata among board members or between board and staff. While these differences exist in a wide range of nonprofits, the impact may have been reinforced in less successful organizations, with more opportunities for conflict to develop. Perceived lack of respect reinforced communication blocks and undermined teamwork. Note that this misalignment was rarely along racial or linguistic lines, but nonetheless reflects a cultural divide.
Does this list surprise you? Is there anything you expected to appear there that did not?
Interestingly, we often heard about assumed problems with boards that did not surface as significant differences between successful and unsuccessful organizations. For example, two commonly cited “problems,” disengagement and limited fundraising, are NOT on the Top 5 list. This is because we found these characteristics in successful nonprofits almost as often as in unsuccessful ones. A board’s impact on fundraising showed a small positive correlation with success. It’s not a bad thing, but clearly wasn’t required for success in the research population.
Surprising Conclusion?
An important conclusion we draw from the data is that a disengaged board didn’t seem to have nearly as negative an impact as an over-engaged board in our study group.
Whenever I discuss these findings with nonprofit leaders, they nod in agreement at the over-engagement part of that. But the idea that board disengagement may, in many cases, be relatively benign seems counter-intuitive. Why would that be? The research offers other clues on this, a key theme being that the work of the staff is most critical to nonprofit success. Staying out of the way of the staff isn’t the worst thing a board can do!
But an ideal board, I infer from the data, appears to be working at a strategic level, sticking to its assigned role (which should be clearly and correctly assigned) and supporting the staff. The board can certainly have a limited role – there’s no apparent need to or benefit from filling the available space with “work”. The dysfunctions are common enough that the ideal seems far from universal. Board development, our research suggests, may be better focused on defining the board’s lane than promoting engagement more generally.
Further, nonprofits may be best served by focusing organizational development activity on the staff, where it can have greatest impact. (Note that our research also suggests several common staff dysfunctions – I’ll get to those in a future article.)
Whenever I discuss our research findings, I point out that correlation does not establish causality. On the other hand, when you see distinctions like this, the data is telling us something important, and it’s worthy of further study.
What I take from these findings is that (a) sometimes our instincts may miss underlying patterns, and (b) we have some real challenges in the nonprofit model.
I will have several specific proposals for addressing these common dysfunctions in a future blog entry. Stay tuned for more. For now, I’m curious how this set of findings lands for you. Please drop me a line and let me know your perspective!