By Robert Nelson
Before you begin to redesign your governance system, invest adequate time in analyzing your current system. After all, this is what Einstein would do!
Einstein has been quoted as having said “if I had an hour to solve a problem and my life depended on the solution, I would spend the first 55 minutes determining the proper question to ask, for once I know the proper question; I could solve the problem in less than five minutes.” In other words, he would spend significant time figuring out what the problem is.
If your current governance system isn’t performing up to par, it’s important to understand why not. Depending on what the “real” problems are, the solutions may lie in making actual structural changes (reformulating the committee structure or size of board, for example) or they may lie in changing the practices the board engages in (agenda design or meeting design, for example). Investing the time to adequately define and redefine the problem will:
- Ensure that you are addressing the root (right) problems;
- Generate information specific to the issue(s) at hand that will be useful in solving the problem(s) and developing a sound governance system; and,
- Lead to group consensus on what the problem actually is, which is vital to the creation and execution of sound solutions.
Although a problem might be complex, the processes used to solve a problem are not complex. The first step is properly defining the problem and this begins with challenging assumptions and breaking the problem down to ensure you are focused on the root problem.
ROOT PROBLEM IDENTIFICATION
Determining the root cause(s) of an underperforming or ill performing governance system is one of the first steps in governance system redesign. Often what is first identified is a symptom of the problem, not the root cause. As such, it is important to challenge one’s assumptions and not get “locked” into the first “problem” that is identified.
When analyzing a governance system, two methodologies are useful: Ishikawa Diagram and Toyoda’s 5 Whys.
An Ishikawa Diagram takes a systems approach to problem identification. The diagram is used to identify all possible root cause categories, under which actual root causes are listed. This approach forces one to consider all of the different parts of the governance system as one analyzes the problem.
An Ishikawa Diagram looks like a fish skeleton, with the initial problem being the head and possible root cause categories represented by the rib bones, under which root causes are listed. The illustration below uses lack an underperforming board as the initial problem, and then identifies six possible root cause categories, which become the rib bones of the diagram. Actual potential root causes are then listed along each rib bone. A more comprehensive list of root categories for governance system analysis is provided further below.
Five Step Process
GOVERNANCE SYSTEM ROOT CAUSE CATEGORIES
As mentioned above, the Ishikawa process starts with brainstorming all of the potential root cause categories. These are comprised of all of the parts of the “system.” Following is a list of root cause categories for governance issues. All or some of these may apply to your organization. You can use this list as a starting place to identify additional root cause categories that are applicable in your situation as you build out your Ishikawa Diagram
- Board Meeting Design
- Nominating Process
- Committee Structure
- Board Size / Structure
- Board Culture
- Board Development
- Board Leadership Development
- Governance Polices
- Governance Practices
- Board CEO Relationship
- Staff Support
Toyoda’s 5 Whys
Toyoda’s 5 Whys is a very simple method to identify root causes. It can be used alone or in conjunction with the fishbone technique illustrated above. When a problem arises, ask why and for each response to the question ask why again until the why question has been asked at least five times.
Applying the 5 whys methodology to our problem of having a board that is a non-strategic thinking entity, the questions might look like this:
- Q: Why doesn’t the Board think strategically?
A: Because they are always digging into short-term tactics.
- Q: Why are they always discussing short-term tactics?
A: Because these issues are perceived to be important by the Board.
- Q: Why are these issues important to the Board?
A: Because they believe it is the role and responsibility of the Board to discuss and act on these issues.
- Q: Why does the Board believe this is their role and responsibility?
A: Because they don’t know another way.
- Q: Why doesn’t the Board know another way?
A: Because we don’t have a governance / Board development program.
Using this example, we see the real problem is not that the Board isn’t thinking strategically, it is that we don’t have a formalized training / development program for our Board members. Of course, each group (or reader) will answer these questions differently; the point is to engage in the process to dig deeper into the actual root problem.
WHY AN INVESTMENT IN PROBLEM IDENTIFICATION MATTERS
Spending time to make sure that you have defined the problem(s) correctly is imperative to governance system redesign. On a very basic level, it ensures that you are focusing on the right problem and creates a high level of probability that the right solution(s) will be developed. Further, working on the problem identification process with a Governance Task Force builds consensus around the actual (root) problem(s). Finally, engaging in robust problem identification reveals information and knowledge that will inform the development of solutions and governance redesign.
Of course, it is also critical that you and your board have a thorough understanding of what good governance looks like as well as the appropriate roles and responsibilities of a high performing board. Likewise, it is helpful to create a vision of what a high performing board would look like for your organization so you can redesign toward that vision.
[Editors Note: This article is provided courtesy of Robert Nelson and was originally published on the Nelson Strategic Consulting website at http://www.nscstrategies.com/governance/assessing-a-governance-system/ on June 9, 2015.]
Robert Nelson is President of Nelson Strategic Consulting and a Certified Association Executive (CAE) and global strategist with over a quarter of a century of successful leadership experience working with Boards and high-powered CEOs, in a not-for-profit setting.