The Role of the Board in Setting Strategy, Part II
“The company without a strategy is willing to try anything.” – Michael Porter
As Michael Porter so eloquently illustrates in this quote, a nonprofit that does not live by a strategy is akin to a group of children playing Pin the Tail on the Donkey. Strategy keeps you focused, it gives you a direction to follow and a plan to enact. For this reason, it is the number one priority of an organization’s Board of Directors (BOD).
Setting strategic direction
According to Brighter Strategies’s resource guide, “Nonprofit Governance: A Guide for Building a Strong Board,” strategic direction encompasses three major tasks. A BOD is entrusted to determine the organization’s mission, select the chief executive, and recruit new board members.
- Determine mission and vision. The BOD should work in conjunction with an organization’s leadership team during the annual strategic planning process. The Board should fulfill the role of “strategic planning sage,” reviewing the recommended plan, providing feedback and guidance, and ultimately ensuring that the plan is carried out effectively. The most critical (and first) step of this process involves determining the organization’s mission – or purpose – and setting a vision for the future. From these overarching “dreams,” a plan can grow to include values, goals, and strategies.
- Select the chief executive and oversee succession management. Every leader in a nonprofit must be accountable to someone, and the CEO is no different. Part of setting strategic direction involves providing leadership oversight. The BOD establishes performance goals for an agency’s chief executive, and monitors those metrics annually. They ensure a leadership pipeline is in place so that the transition from one CEO to the next is as smooth as possible. Ideally, this task is a proactive one; however, the BOD serves to identify and appoint a new chief executive in the case of an unexpected leadership transition.
- Recruit and orient new board members. Like the recruitment process your HR team uses to keep your organization fully staffed with top talent, a BOD must continually refresh its roster to ensure all critical skills are represented within the group. To select new members, first identify the existing gaps and determine what new expertise is needed based on your organization’s mission, vision, and strategy. Then, prepare and disseminate a call for new members to all key stakeholder groups. Gather resumes from prospective individuals, review with the current BOD, interview top candidates, and vote on new members. Finally, onboard these new members by providing a blend of training and mentorship opportunities during their first few months on the Board.
Is your agency’s Board of Directors helping to set an intentional direction by determining your organization’s mission, overseeing CEO succession, and recruiting new members? These tasks are crucial first steps in effective strategic planning. Organization development consulting firm Brighter Strategies has decades of experience in nonprofit governance. If you require assistance in strategic oversight at a Board level, we are here to help. Please contact us to learn more.