Nonprofit Boards Must Think About the Future

Nonprofit Boards have many important responsibilities related to compliance, development and oversight.  However, those activities alone will not keep the organization viable and relevant for as long as the mission requires.  While operational issues are important, the Board must have a forward focus and should be spending the majority of time thinking about the future.

An Honest Assessment

Nonprofit Board leaders need to take a step back and assess the amount of time and effort they spend on current operational topics versus future building activities.  The typical Board spends the bulk of meeting time reviewing financial results, getting status updates from Management, discussing compliance topics and projects, such as; fundraising events, facilities projects or succession.  Many Boards spend a bit of time on strategy, perhaps a “Board Retreat” or a recurring agenda item on an initiative.  This lack of future focus can cause serious issues when unforeseen events disrupt the nonprofit’s ability to deliver its mission.

Nonprofit Boards Should Be Thinking About…

There are four critical topics that Boards should be spending 80% of their time thinking about.  They are; Strategy, Culture, Risk Management and Advocacy. Taken together these topics represent a future thinking model for any organization and if done thoughtfully, will prepare the organization for the long term.

Strategy

The Board is uniquely positioned to guide a nonprofit’s strategic direction as it should have a solid understanding of the organization’s capabilities as well as connections into the nonprofit’s client community and funders.  With time and focus, the broad perspectives that Board members bring can be highly effective in identifying trends that will impact the nonprofit and thinking about ways to proactively address them.

Culture

The Board cannot underestimate the power of culture within the organization and should have regular discussions and assessments of the positive and negative aspects of the nonprofit’s culture.  Once the Board has an understanding of the current culture, they should use that information when considering strategies and other initiatives.  Change without an understanding of cultural impact can be difficult if not impossible.  For example, organizational culture should be a factor in succession because hiring a leader who is incompatible with the culture will likely turn out badly.

Learn about the importance of aligning strategy and culture.

Risk Leadership

At the Board level, risk is a topic that should be discussed in a way that balances the risk of taking action with the opportunity risk of not taking action.  Many Boards focus on operational risk avoidance by not doing something that has inherent risk, but the larger negative impact may come from not doing something that has a necessary benefit.  For example, starting a new service line may open the nonprofit up to new risks, but not starting the new service may cause the nonprofit to be over reliant on a funding source or the nonprofit may miss out on growth opportunities that could make the organization more resilient.

If you are unfamiliar with Risk Leadership, check out this post.

Advocacy

Nonprofit Boards are typically populated with highly experienced well-respected folks who are very engaged in the organization’s mission.  With this pedigree the Board is the part of the nonprofit best suited to leading the advocacy efforts.  They should have the connections and expertise to understand advocacy at all levels of the organization as well as at the nonprofit sector level.

Learn how to supercharge nonprofit advocacy

Interrelationships

These four topics are heavily intertwined.  Culture and strategy must work in concert and risk can often be a function of culture.  Advocacy is basically a form of broad risk leadership with potential issues and opportunities being proactively addressed years or more into the future.

Execution

While each of these topics impact the operational organization, they should not be left to management to handle.  These are not the issues that require only Board oversight; they are the ones that Boards need to engage in deeply and regularly.  They are future oriented which is why the Board should be the best group to tackle them.  Unfortunately, as stated previously, many Boards spend most of their time on operational or compliance, so Boards will need to make some changes.  A few good places to start are;

Committee Responsibilities 

One of the most effective ways to free up Board time for broad thinking is to shift compliance and operational oversight responsibilities to Board committees.  With committees tackling the operational issues, the Board should have time in meetings to ponder these larger concerns.

Brief Briefings  

Presentations to the Board for decisions or informational purposes should be at the appropriate level.  Call it “short, but sweet.” Remember that Boards do not meet often enough to know every operational detail, so their oversight role is to understand the thought process behind a proposal, not every line item involved.

Get Help

Future focused topics are complex and are predicated on a deep understanding of the current situational awareness and trends.  Acquiring that level of understanding is challenging for any organization, so be prepared to get outside help.

Identify Champions

Pick someone, most likely a Board member, to take on the role of advocate for each of the topics.  This person should have a passion for the issue.  This person should look for ways to educate the Board on the topic, look for speakers or seminars for members of the Board to attend and should keep the topic in ongoing conversations.

Do What You Can

These topics require education, significant data gathering and a lot of effort, so if you have a smaller Board, then start small.  Pick one or two of the four to begin to discuss and finds ways to address.  Learn from these early efforts and roll that knowledge into your Board Membership recruiting process.  Identify knowledge or network gaps to look for in future Board members.

Bottom Line

Think about the future.  Is your nonprofit Board spending its valuable time on preparing for the future or is it using that time to talk about the budget or reviewing policies?  If your Board is ready to add real value, then shift some focus from the day to day into the areas of Strategy, Culture, Risk Leadership and Advocacy.  While they require heavy lifting, these are the areas that will shape the organization’s ability to meet its client communities’ needs for now and the future.  And it all starts with forward thinking.

About the author:

Michael F. Cade is a nonprofit leadership pathfinder, guiding nonprofits Beyond the Numbers to solve problems, optimize operations, execute strategy and ultimately attain long-term viability and relevance.  His Framework for Fiscal Sustainability is an innovative comprehensive evaluation tool for assessing organizational health and ongoing mission readiness.

Mr. Cade has been an executive coach for over 18 years working with leaders from for-profit and nonprofit organizations.  He specializes in fostering executive advancement by strengthening leadership competencies.

Mr. Cade speaks on nonprofit leadership and strategy topics, and has authored articles, guest blogs and podcasts. He publishes the nonprofit leadership blog  Not for Profit Beyond the Numbers

If you have questions on this or other nonprofit leadership issues, contact him at:  mfcade@nfpbeyondthenumbers.com

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