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September 18th, 2009

Good Governance Development – A Consultant’s Story

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good governance

I worked recently with the Board of Directors of a large public power company. They needed stronger governance systems. I talked about how effective boards work. I detailed our approach.

“With our framework,” I told them, “the board expresses exactly what it wants the organization to achieve in the form of policies. By defining what it expects in writing, and by regularly monitoring those policies, the Board can do its job, staff can do its job, and the organization can achieve high levels of performance.”

“But we already have policies,” one board member said.

“You do have policies,” I said. “But those policies are not the board’s policies. They are a mixture of state and federal policy, with a lot of your staff’s policy thrown in for good measure. I’m talking about a separate set of policies that express only what the Board wants the organization to achieve.”

“Why would we need that?” said another board member. “Our policies seem fine to me.”

“Because it would enable the board to communicate as a board,” I said. “Right now, you communicate as individual board members. But the board of directors is a single entity, and the board needs to say what it wants. Otherwise, your staff has to guess. And that leads to all sorts of mischief and mayhem.”

“Maybe we like it that way,” said one board member. “We can then tell them to do what we want.”

“Is that really how you want to communicate?” I asked. “What if you had 20 bosses, all telling you different things? How long would you last in that organization?”

I let that sink in. “Look, the best boards in the country use this framework. I’ve seen the results. It enables the organization to be clear about its priorities, clear about its measures of success, and clear on how it’s going to evaluate the general manager or CEO. That’s good governance. All boards should aspire to it.”

“Well,” said one board member. “Maybe we just like doing it our way.”

At least that’s honest, I thought to myself. Out loud, I asked, “How many of you would like to move toward this framework? How many of you would like to try this?”

A few hands went up, and then a few more. I looked at the one board member who was most vocally resistant. Slowly his hand went up, too. I looked around. All the board members were raising their hands.

“All right,” I said. “It looks like you have made a decision. Let’s figure out what you want to do next.”

Related Article: “Good Governance and Performance Goals“

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September 9th, 2009

Strategic Change Management and the First Five Percent


Strategic Change Management
I have written before about the “First Five Percent.” That’s my approach to strategic change management that says the quality of the first five percent determines what happens in the rest of the process.

I was in Los Angeles last week, working with a large association, on a strategic plan for their organization. It was the beginning of a year-long process to create a high-performing organization.

One of the rules of the First Five Percent is to engage as many people as possible early on. You never know who has the good ideas. The more people you engage early on, the quicker you can identify the best thinking and the hidden resources.

There were 300 people in the room, including board members, chapter leaders, and local officers. The agenda was flexible. Depending on how the first exercise went, I was prepared to go in different directions to assure high levels of participation.

The first question I posed was this: “Think about where you want the association to be in two years. Tell me the specific changes you want to see and your measures of success.” They worked on this question for 60 minutes and wrote down their responses on flip chart paper.

Each group then reported out. I then asked them: “What did you hear yourselves say? What did you agree on?” Everyone called out what they heard. “Increase membership.” “Fill our vacancies.” “Create a new business line.” Their juices were flowing. “How would you measure success?” I asked. They shouted out what they’d heard. I listed four specific measures of success. I asked if they all agreed. Everyone raised their hands. They took a quick break for lunch.

While the room was quiet, I thought about my next move. I looked over all of their reports, and decided I should simply tap into their energy. I listed 12 goals on flip chart paper. Each goal came from them, like “Double our membership” or “Increase our political clout.” I posted these goals on the walls of the room.

When they came back from lunch, I said: “Take a look around the room. These are your goals. Find a goal you feel passionate about. Go stand by that goal. For those of you who are passionate about some other goal, there are blank pieces of paper.”

The group divided itself into teams around each goal. I asked them to develop an action plan for each goal and then report out. During the report-outs, I identified key issues that needed to be resolved and facilitated a discussion around each issue. When people drifted off topic, I invoked the two-minute rule (”Anything important can be said in two minutes”) and they got back on course.

We wrapped it up at 4 p.m. I asked people to tell me what they liked about the meeting. “It was energizing,” someone said. “Great ideas!” several people said. “Your guidance,” someone said. “The two minute rule!” several shouted. “We’re excited to be building our organization,” a woman said. “And what would you like to change?” I asked.

“That we have to leave!” a man shouted. Everyone laughed.

Next blog article: “Our Change Management Model“

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September 9th, 2009

Three Principles of Our Change Management Model


Change Management Model

When people ask me to describe our change management model at LRI, I tell them it boils down to three principles.

Principle number one: focus on the first five percent. What you do to gather champions, set expectations, how extensively you engage stakeholders, and how well you paint a picture for people of the decision-making process will go a long way toward guaranteeing a successful outcome. Let me emphasize the importance of engaging many people early on – those who will be affected by the decision and those whose expertise can help. Even when ideological stances are strong, early engagement is always the better approach (as opposed to shutting people out of the process).

Principle number two: Focus on defining the root problem. Solutions don’t matter unless you define the problem correctly. We emphasize a systems approach. Too often people say things like: “We need better products,” or “we need more sales, or “staff isn’t working hard enough,” without looking at the reasons why. Very often, the answer lies in looking in the mirror – at what you’re doing or not doing. One systems approach is to look at the organization’s core values – the things essential for its success. You can make tough decisions look easy if you ground them in well-understood core values.

Principle number three: Find a good guide.  An experienced guide can set the tone, keep an open mind, identify key issues, articulate points of agreement, and keep things moving. A guide should be able to offer models and examples from other organizations. The courage to handle uncertainty and adversity is also important, along with a healthy sense of humor. Good, experienced guides are hard to find. But they are absolutely essential to our change management model.

Next blog article: “Strategic Change Management“

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