William P. Ryan AJFCA/IAJVS Annual Conference New York City April 15, 2007

1. William P. Ryan AJFCA/IAJVS Annual Conference New York City April 15, 2007 The Governance Futures Project

2. What’s the Problem? G o v e r n a n c e as L e a d e r s h i p

3. Key Propositions of Governance as Leadership • Boards need three mental maps to understand three different aspects of organizations. • Boards need three governing modes that reflect those maps. • Each mode serves important purposes, and all three sum to Governance as Leadership. • A board’s governing effectiveness increases as it: • Becomes more proficient in more modes; • Does more work in third mode; • Chooses appropriate mode(s) of work. G o v e r n a n c e as L e a d e r s h i p

4. Triple Helix Issue: An Example Should Boston Museum of Fine Arts lend 21 Monet paintings to Bellagio Casino in Las Vegas? ? G o v e r n a n c e as L e a d e r s h i p

5. Triple Helix Issue: An Example Should Boston Museum of Fine Arts lend 21 Monet paintings to Bellagio Casino in Las Vegas? Fiduciary:Travel-worthy? Insurance? Security? Donor restrictions? Financial arrangements? Timeline? Curatorial control? Strategic:Effect on MFA attendance, image, audiences? Prototype deal? Competitive responses? Patron tie-ins? Vegas in Boston? Generative:Mission related? What will MFA do for the right price? Public art/private dealer? Venue consistent with values? MFA conservative or iconoclastic? G o v e r n a n c e as L e a d e r s h i p

6. Three Organizations in One Governance as Leadership Type II Strategic – Logical Type III Generative – Expressive Type I Fiduciary – Productive G o v e r n a n c e as L e a d e r s h i p

7. Type I: Fiduciary Mode • Board’s central purpose:Stewardship of tangible assets • Board’s principal role:Sentinel • Board governs: The Productive Organization • Board’s core work: Oversee operations Ensure efficient & appropriate use of resources Ensure legal compliance & fiscal accountability G o v e r n a n c e as L e a d e r s h i p

8. Type II: Strategic Mode • Board’s central purpose:Ensure winning strategy • Board’s principal role:Strategic partner to senior management • Board governs: The Logical Organization • Board’s core work:Scan internal and external environments Set priorities Review and modify strategic plan Monitor performance against plan G o v e r n a n c e as L e a d e r s h i p

9. Generative Thinking • Definition: A cognitive process for deciding what to pay attention to, what it means, and what to do about it. • Familiar version: Paradigm shifts • Less familiar: Organizational process • Implication: Made explicit, generative thinking is governance G o v e r n a n c e as L e a d e r s h i p

10. Locating Generative Thinking The Generative Curve Problem-framing Sense-making Opportunityfor Generative Work Strategy Plans, Tactics, Execution Time The opportunity to influence generative work declines as issues are framed and converted into plans, strategies, and problems. G o v e r n a n c e as L e a d e r s h i p

11. The Generative Dilemma Generative Curve Amount Typical Board Involvement Curve Time Trustee involvement is lowest where generative opportunity is greatest; trustee involvement increases as generative opportunity declines. G o v e r n a n c e as L e a d e r s h i p

12. Inventing Generative Governance G o v e r n a n c e as L e a d e r s h i p

13. Generative Thinking: Four Profiles Staff Engagement High Trustee Engagement Low G o v e r n a n c e as L e a d e r s h i p

14. The Payoff • Empowers the board. • Engages the collective mind. • Exploits board’s assets. • Enriches board’s work. • Enhances board’s performance. Governance as Leadership G o v e r n a n c e as L e a d e r s h i p

15. Learning More… Governance as Leadership: Reframing the Work of Nonprofit Boards by Richard P. Chait, William P. Ryan, Barbara E. Taylor John Wiley & Sons, 2005 available at: www.boardsource.org william-ryan@comcast.net G o v e r n a n c e as L e a d e r s h i p

16. Practice Challenges Entry points for practice: • Routine board meeting • Reflection and retreats • Relationship dynamics and conflicts G o v e r n a n c e as L e a d e r s h i p

17. Routine Board Meetings Look for generative landmarks: • Ambiguity. Multiple interpretations of what’s going on or what requires attention. • Salience. Issue means a great deal to a great many. • Stakes. Issue touches on core values or organizational identity. • Strife. Prospects for confusion or conflict are great. G o v e r n a n c e as L e a d e r s h i p

18. Routine Board Meetings Mind the mode: • Facilitate to avoid ‘cross-governing’ • Deliberate ‘a la mode’ • Promote robust discourse in all modes G o v e r n a n c e as L e a d e r s h i p

19. Routine Board Meetings Carve out generative space: • Consent agenda • Silent starts • One-minute essays • Mini-executive sessions • Plenary as committee-driver G o v e r n a n c e as L e a d e r s h i p

20. Practice Challenges Entry points for practice: • Routine board meeting • Reflection and retreats • Relationship dynamics and conflicts G o v e r n a n c e as L e a d e r s h i p

21. Reflection and Retreats High-curve practices • Catalytic questions • Retrospective thinking • Boundary work • ‘Sensible foolishness’ G o v e r n a n c e as L e a d e r s h i p

22. Reflection and Retreats Catalytic questions: • What keeps us awake at night? • What nagging or intriguing thought have we had but not expressed? • On what list do we want to rank #1? • What would we do differently as a for-profit? • How would we respond to a $10M challenge for best idea to be greater public asset? G o v e r n a n c e as L e a d e r s h i p

23. Reflection and Retreats Retrospective thinking – dominant narratives: • What’s our ‘dominant narrative’ and is it working? Retrospective thinking – strategy: • What’s the pattern? • What best explains recent successes/setbacks? • What do we know now that we didn’t at last plan? • Where do we meet resistance and why? G o v e r n a n c e as L e a d e r s h i p

24. Board-to-board boundary: What do you make of for-profit competition? How are you handling changes in funding? How do you respond to consumerism? What have you learned about leadership transition, capital campaigns, strategic planning, governance? Board-to-staff boundary: Why do you work here? What’s your biggest challenge? What’s most rewarding about your work? What’s the organizational culture? What are some powerful stories? What one thing would you change if you could? Reflection and Retreats G o v e r n a n c e as L e a d e r s h i p

25. Practice Challenges Entry points for practice: • Routine board meeting • Reflection and retreats • Relationship dynamics and conflicts G o v e r n a n c e as L e a d e r s h i p

26. Relationships: Dynamics and Conflicts • Dangers in the ‘safety zone’ • CEO is often: • Vested, slightly defensive • Handling (vs. engaging) board • Board members often: • Feel uncertain of their value • Disengage • Second-guess, play ‘gotcha’ • Meddle or micro-manage • Dialogue is often: • Technical or analytic • Aimed at finding one right answer CEO Danger Zone CEO Safety Zone G o v e r n a n c e as L e a d e r s h i p

27. Relationships: Dynamics and Conflicts • Opportunities in the ‘danger zone’ • CEO is: • Open, in a learning stance • Willing to engage (vs. handle) the board • Board members: • See their chance to add value • Get deeply engaged in meaningful, consequential work • Dialogue is: • Values- (vs expertise-) driven • Aimed at making judgments CEO Danger Zone CEO Safety Zone G o v e r n a n c e as L e a d e r s h i p

28. Relationships: Dynamics and Conflicts • To help board get to higher ground: • Recruit to govern, not manage • Promote collegiality over congeniality • Detoxify ‘religion and politics’ • Use shared learning for shared • meaning • Cultivate norm of mutual accountability Shared governance G o v e r n a n c e as L e a d e r s h i p

29. Relationships: Dynamics and Conflicts • The personal leadership challenge • for CEOs: • Take risks • Resist need to be omniscient • Manage ‘dreaded’ and ‘desired’ images Shared governance G o v e r n a n c e as L e a d e r s h i p