User:Anthere/governance

old board manual - Policy governance manual

I would like to suggest a change of governance model for the Foundation. The new general model to follow would be the one referenced as "policy governance model", described by John Carver and Miriam Carver.

History

At the start

I have been on the board since it was fully formed, in June 2004. At first, the "model" we were roughly following could be best described as "advisory model". Jimbo was the president-chair. He was the only public face, the leader of the community, the one entirely in charge of operations etc... The role of Angela and myself was essentially a role of communication and advising. Our role was clearly described as being the ones to collect information from the editing community, voice these opinions to the governor of the board (Jimbo), and report back to the community. We did not have a system of resolutions, nor minutes of meetings, no formal decision-making system other than a promise from Jimbo that he "never would do something that would make both Angela and I unhappy with". From a board governance perspective, this was a very bad model :-)
But it was probably one that was necessary as a transition model to move away from the "benevolent dictatorship" that had prevailed until then.

A bit more on this "advisory model"

"This model emphasizes the helping and supportive role of the Board and frequently occurs where the CEO is the founder of the organization. The Board's role is primarily that of helper/advisor to the CEO.
Individual board members may be quite active in performing these functions and consequently feel that they are making a valuable contribution to the organization. Board meetings tend to be informal and task-focussed, with the agenda developed by the CEO.
The Advisory Board model can work well for a short time in many organizations but it exposes the board members to significant liability in that it fails to provide the accountability mechanisms that are required of boards of directors. By law, the board has the obligation to manage the affairs of the organization and can be held accountable for certain actions of employees and committees. It must therefore maintain a superior position to the CEO."

Over time, this advisory model became unworkable and unsatisfactory for board members. It became frustrating for Angela and I, as we were excluded from many strategic decisions; frustrating for everyone, since at some point Jimbo could no longer have the time to do it all; and generally unsuitable for a non-profit, as we were not playing our role as fiduciaries.

Management Team model and working board

Just over a year ago, in January 2006, we started moving toward another model. I can not say we were ever fully respecting one model, but conceptually, we moved toward a mix of Management Team Model and working board.

"A working board has some responsibilities for the operations of the organization. In addition to providing policy and general direction, the board members may help in practical ways such as organizing events and drafting documents. Usually, this type of board comes up with a collection of committees and subcommittees, along functional lines. The structure of the board and its committees usually mirrors the structure of the organization's administration. Just as there are staff responsible for human resources, fund-raising, finance, planning, and programs, the board creates committees with responsibility for these areas. The board members are also the managers and delivers of programs and services. Individually or in committees, board members take on all governance, management and operational tasks including strategic planning, bookkeeping, fund-raising, newsletter, and program planning and implementation.

The widespread adoption of the Management Team model arises out of its correspondence with modern ideas about team management and democratic structures in the workplace. It also fits well with the widely held view of nonprofits as volunteer-driven or, at least, nonprofessional organizations.

Boards which operate under this model are characterized by a high degree of involvement in the operational and administrative activities of the organization. In organizations with professional management this normally takes the form of highly directive supervision of the CEO and staff at all levels of the organization. Structurally, there may be many committees and subcommittees. Decision-making extends to fine details about programs, services, and administrative practices. When working well, two criteria tend to be used in the selection of members: their knowledge and experience in a specific field, such as business or accounting; or because they are members of a special interest group or sector that the board considers to be stakeholders."

This is what we did; this is even exactly the description of our organisation. In January 2006, we started the creation of the committees (comcom, spcom, financial com, audit com, chapcom, fundcom, techco etc...), under the responsibility of the board with certain delegations.

In June, we hired Brad to pick on the operational duties and management of staff, but the board stayed very involved in operational stuff: Angela and Jimbo on the comcom, Michael on the audit com, myself on the spcom.

(First distinction here: there are some committees which are obviously very operational (such as the techco), others purely board-level (such as the audit committee) and many committees are mix.)

In October 2006, I became chair of the board, another move toward a more mature organisation in the sense of separation of roles.

But then, what happened? Without going into details, we no longer had a CEO in January, and the board went in the direction which is logical with such a model and, maybe, is also the direction of least effort. As I announced publicly end of January, the board decided to take it upon itself to fill the role of CEO, while the search for a permanent Executive Director was launched. This is when we reached the limits of this model.

More on the risks of such a model

"While this model works well for all-volunteer organizations, it has proven to be less suited to organizations that already have professional management and full-time employees. Indeed, the deficiencies of this model have led to the current thinking in the field which differentiates "governance" (the practices of boards of directors) from "management" (the practices of employees) and the deluge of research, articles, and manuals on this topic.
The most important shortcoming is that all too frequently, it degenerates into what I call the Micro-management Team Model in which board members refuse to delegate authority, believing that their role requires them to make all operational decisions, leaving only the implementation to paid staff. The result is invariably a lack of consistency in decisions, dissatisfied board members, resentful staff and a dangerous lack of attention to planning and accountability matters."

Which is basically what is happening right now.

Reasons to change governance model

There are a number of reasons for considering a change in a governance model. Following are some commonly given.

Board members are dissatisfied with their roles or the way the board operates.
This happens to be my case. I feel that the daily operational trivia is taking its toll on me. I just can not work full time for the Foundation as a volunteer, and still work aside to make a living and take care of my kids. I can not at the same time take care of daily stuff and still be able to step back and work on strategy. I feel we are not fully dedicated to our jobs as board members. I think that more or less, all board members agree with the idea that this is not satisfactory.

The organization is experiencing problems that can be traced back to inadequacies in board structure or process.
Danny left the organization due to his unhappiness with the way we proceed. While Danny is just one person, other staff members also seem to be unhappy with the way we operate. Many volunteers complain about the problems related to communications. It is interesting to note, though, that the working board model is not something that is considered unacceptable and unsuitable, but only as one of the various governance models, all of which have qualities and drawbacks.

The organization is entering a new phase in its life-cycle; the CEO has left or is leaving.
We are looking for a new CEO, one interim and one permanent. The ED search company has warned us that the structure of the organization should be clarified if we want to attract good candidates and have a chance of success in integrating the new CEO.

there has been a major turnover of board members;
Not yet, but possibly soon ?

there is a crisis of confidence in the board or the CEO
It seems there is. :-)

Reluctance to hire a CEO

There seems to be a belief that finding a CEO will miraculously solve all of our pending problems. I do not buy that :-)
On the one hand, the ED search company considers that the job will be real tough, because "There seem to be a number of different views of the Board's role as well as a general reluctance to place any constraints on what the Board does, or even on what individual Board members can do. Some Board members have pointed out that it will be easier to trust an Executive Director once the Board works with him or her for a while, and only then will the Board really know what authority it wishes to grant to the ED."

They fear that "the Executive Director would NOT represent the Foundation to the public at large, would have no defined authority nor an ability to act independently, and appears to be a functionary who is managed directly by the board according to constantly evolving policy decisions and whatever consensus is reached on issues as they arise without an agreed on strategy for future growth."

While this is putting it a little bit boldly (a good CEO should be able to make himself more than a functionary) and is a little bit pessimistic (we actually attracted several pretty good candidates), the general idea is there.
I have been trying to identify board members' fears regarding the CEO, and the recent discussions are enlightening. We are currently looking for an interim ED (and it seems just filling up this duty is becoming an unreachable goal :-)), and we have right now two conflicting sides:

One argues that we should hire a professional interim ED, the type of person used to deal with crisis situations, who will come up with a set of policies and best practices due to his experience, and probably leave after a thorough clean-up of the office without trying to stick to the seat. Another benefit is that this person could make teeth grind, but can be tough if necessary since he will not stay for a long time.
Another side argue that we can not pick up such a person, as he will know nothing about wikis, the community, open source and free content, and nothing of all this precious background... which is only known to board members, community members, and a few precious individuals elsewhere in the free world. So this side argues that it is best to pick up someone from the community to avoid having to toilet-train him (my words), with the drawback being that we know of no professional interim ED in the community, so would not have necessarily hired a professional.

If you read between the lines of this argument, the transparent problem is to trust someone to not make bad decisions due to their lack of familiarity of our environment, eg:

what if he puts ads on all Wikipedia pages (even in a context of fund raising ;-))
what if he makes a deal with Microsoft
what if he hires a troll without realising he is one
what if he decides to get rid of Wikiquote project
what if he decides to sue Google Earth for using our logo
what if he signs a deal to stick our logo on fridges
what if he agrees to a deal with a proprietary software

I guess you get the idea. :-)

And this is true for the interim ED as well as for the permanent ED...

The permanent ED is however more critical. Either we hire someone from the community, who will know the projects and context very well (which does not mean we will all agree with him; we may know the context, but we do not necessarily agree on everything) but has no or little management experience; or we hire an external person who will (hopefully) have much to bring in terms of experience, management, organization, "back-office" (all things much needed), but who will need to be babysat for a while and carefully followed to avoid any major mistake.

The first case seems more secure at first; but the long term vision pushes for the second type. More effort to provide, but bigger success to be expected.

Which leaves two requirements.

To tell him the big story. Explain free and open content and software, the virtues of volunteering, the vision of free access to everyone, the challenge of getting money with very little to sell, etc...
To set up limits to give him freedom, without letting him wild in the open

Proposal

The suggested model

So what is that policy governance model that I suggest we adopt.

Let me copy here a text written by Caroline Oliver:
"Carver model proposes that all policies deal either with an end or a means. Ends are what the organization is for, while means policies deal with what the organization does to achieve those ends. Policy Governance suggests that all possible board concerns can be grouped into four categories of policy: governance process, board-staff relationship, executive limitations, and organizational ends.

Governance process and board-staff relationship policies define the board's operating practices, how it delegates authority, and how it maintains accountability (the board's "means"). Executive limitations govern the behavior of staff while organizational ends policies express what the organization is for— defined as the answers to the questions "what benefits, for which people, at what cost".

In the Policy Governance model, the board creates policy in each category starting at the broadest level before proceeding to address more specific issues, always progressing from broadest to narrowest. Finally the board gives its chair the authority to act within "any reasonable interpretation" of the first two categories, and its CEO the authority to act within "any reasonable interpretation" of the last two categories.

Board policy crafted in this way comprehensively covers the whole organization, and yet the written manual typically runs to no more than thirty pages with an average of five points on each. Delegation is clear and performance monitoring becomes fair and manageable for all involved."

I have two main links to provide to any of you who wants to know more about this model. I really suggest taking the time to read them and tell me what you think.

http://www.carvergovernance.com/pg-corp.htm (this one is shorter)
http://www.carvergovernance.com/pg-np.htm (this one gives more details for the curious ones)

To control ends in an affirmative and prescriptive way, the board expresses to the CEO its performance expectations.

To control means in a limiting and proscriptive way, the board expresses to the CEO boundaries around acceptable managerial decisions. The board does not tell the CEO how to do the job, but how not to do it. In other words, except for imprudent and unethical practices, what an organization does (the choice of the CEO) is allowed to be whatever will best serve what it is for (the choice of the board). Means control is best thought of this way: What situations, activities, or decisions by management would not be acceptable to the board even if they worked? That is, even if ends are being achieved, there are certain risks, ethical violations, and improprieties that would still be off-limits.

No board member alone, including the chair, has any authority over the CEO. The board as a BODY tells the CEO what to achieve (ends) and what to avoid (unacceptable means).

CEO evaluation is made quite easy. Did he achieve the ends? Did he avoid the unacceptable means?

In reading that, I can not help thinking that this is what we should do.
I feel perfectly comfortable with the idea of "describing what we want and what the organisation is". We have gone a long way on this, and it would be a good idea to actually put that in a document. We have worked on the basics, for example our vision and mission statement. :-)

I believe that the fears expressed by some board members will be alleviated if instead of painfully working on policy documents, we were simply describing what we do not want to happen, deals we do not want to be signed, potential partners we do not want as partners, and then... let it be. We are actually very good at not commenting when something is done the right way, and screaming loudly when it is done in an outrageous way. :-)

Reported risks and changes

There are some studies reporting problems with this model. http://www.iog.ca/boardgovernance/html/mod_ove_pol_mor_cri.html

Yup, probably no model is perfect. But then, we have never strictly followed any model. The one thing that is likely to cause a problem is that normally the model requires strict separation of board and staff, with the CEO as the official link between the two.

"The benefit of this approach is that roles and responsibilities are clear, as is accountability. However, the danger is that the board and staff feel disconnected from each other. With the separation of roles, board members lose their understanding of programs because of a lack of program details. Staff may be resentful or dismissive of board decisions when they perceive the board as remote and without understanding of implementation realities. The staff may also feel disempowered to contribute to the direction of the organization."

I presume such a strict separation would not be possible in our organization. Three main areas of activity have been identified:

Community leadership
Infrastructure management
501(c)3 governance

While the third point is exclusively board business, the board members are now deeply involved in infrastructure management and in some cases community leadership, since it is the reason they have found themselves on the board in the first place.

I believe we could largely implement the policy governance model to the infrastructure part.

It has also been suggested that we could separate the Community Leadership Board from the 501(c)3 Governance Board so that each group could more effectively exercise its function.

Now, please look at that above sentence more clearly. I think one of the reasons why some board members would not be happy with the governance policy model is that normally, that would mean they should stop (for example) pursuing contacts and partnerships for content exchanges, publishing DVDs, or starting a new project. But when you look at it really hard, why is pursuing contacts and partnerships for content exchanges relevant to being on a governance board?!

It is unrelated. It is not board business. It is something else, but not board stuff.

Our main problem right now is that the position of board member somehow opens the right to pursue partnerships and largely messes the whole context of governance board.

What does that suggest? Some would suggest an American chapter, at least to deal with local US partnerships. Or should that be another board, such as a wiki council? Who would have a final say on which partnerships are pursued at the global level? My answer is the CEO— again, not the board. In any case, I see no reason why a board member could not be involved in some partnership, or in developing MediaWiki, or in organizing Wikimania. What should be made clear, though, is that he is doing so as a regular person, not as a board member with a special voice.

I am willing to try to implement something in relation to that governance policy model, even if it does not fit exactly the model; at least we would have tried. ;-)

But if the board agrees to try this governance model, that means that you, community members, will also have to help to make it work.

ant