• Strategic Thinking: A Nurse’s Skill
  • Nonprofit Board Service in Oregon: Opportunities Abound
  • Nurses’ Service on Hospital Boards
  • Nurses as Stewards of the Boardroom
  • Your Leadership Presence
  • Governor-Appointed Boards
  • Nurses Improve Boards. BoardRoom Press Highlights Why
  • The Value of Placing a Nurse on Your Board of Directors
  • Nurses in the Boardroom
  • Financial Management
  • Succession Planning
  • Fundraising
  • How to Choose a Board
  • Staff/Board Relations
  • Do’s and Don’ts
  • Types of Boards
  • Top 10 Practices of Great Boards
  • Red Rules for Boards
  • Distinguishing Governance from Management

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Strategic Thinking: A Nurse’s Skill

Strategic Thinking: A Nurse’s Skill

By Colin Berry

A professional nurse is many things: diligent, communicative, unflinching in her standards of professionalism; empathic, detail-oriented, quick-thinking. Effective nurses think strategically, aware of the long view even as they are laser-focused on the details.

Whether helping patients, improving workplace logistics, or ensuring that decisions align with long-range goals, nurses are strategic thinkers by nature, skilled at holding a sharp-eyed view of the future while embracing processes that propel their organization in the right direction as quickly and smoothly as possible.

Strategic thinkers use both sides of their brains — logical left and creative right — and develop both purpose and process to their professions. Lifelong learners, they are aware and perceptive, weaving flexibility into their workflow even as they clearly define its objectives. They understand the importance of taking care of themselves, and aren’t afraid to ask for help. They’re hard-working and honest. Sound like anyone you know?

Many of the qualities that describe an effective nurse are the same that define a powerful board member.

“Competency” is defined as the capability to apply a set of related knowledge, skills, and abilities required to successfully perform critical work functions. For nurses who are natural strategic thinkers, these competencies include the abilities to:

  • anticipate change
    Strategic thinkers must be able to clearly identify threats and opportunities to their organization and be proactive and realistic in addressing them.
  • challenge assumptions
    Strategic thinkers must be willing to evaluate the status quo and, where it’s appropriate, to embrace it, fine-tune it, or reject it and propose something new.
  • interpret the environment
    Strategic thinkers must be able to discern patterns that point to stagnation or change. They aren’t intimidated by data, and can recognize emerging needs long before they arrive.
  • make tough, timely decisions
    Many organizations err by not moving quickly enough; strategic thinkers know that decisions must be made at the right moment and for the right purpose.
  • align stakeholders
    Strategic thinkers find common ground with everyone involved with the organization and help them prepare for change. Truth-telling is key.
  • look for lessons learned
    Because they are continuous learners, strategic thinkers are able to honestly reflect on their own actions and decisions in order to become better at the next one.

Look over that list. Where in your everyday professional responsibilities can you find those competencies in yourself? Which do you recognize? The more of them you can identify, the better qualified you’re likely to be for board service. Don’t sell yourself short: Strategic thinking is strategic thinking, no matter where it’s applied.

If you’re a nurse set upon landing a board position, honing your strategic thinking skills is crucial to your personal leadership development. Spend time with other leaders; ask them to walk you through their internal processes and provide feedback on yours.

Once they’re fully seated, boards are also responsible for guiding an organization’s planning process, typically directed by a Strategic Planning Committee. In her book, Nurse on Board: Planning Your Path to the Boardroom, author Connie Curran clarifies the relationship between strategic thinking and strategic planning — essentially, that the first is needed in order to create the second. She outlines several steps in the planning process:

  • Gaining buy-in from key participants and other stakeholders, including the CEO, board chair, clinical leaders, and other stakeholders asked to participate
  • Conducting an environmental assessment, which helps those involved in the planning process understand both the external and internal environments facing the organization
  • Developing both planning and financial assumptions that guide the process, linking the plan with the resources necessary to achieve it
  • Developing a strategic framework that includes the organization’s vision, mission, and values, allowing participants in the process to set strategies to achieve them,
  • Establishing performance measures that allow board and leaders to collaborate, periodically assessing their progress towards achieving a bigger plan.

On its way to strategic planning, strategic thinking looks a lot like what most nurses do every day. Bringing it to the boardroom requires thinking metaphorically — thinking of the organization in the same way you’d imagine a patient on a path to healing, a unit (or a hospital) seeking to improve itself: aligned with its mission and open to opportunities that smooth its voyage along the path. It’s in a nurse’s nature to think this way; doing so on a institutional or organizational scale allows the nurse-director to elevate a board’s thinking, its planning, and its achievements as a health care leader.

In Nurse on Board, Connie Curran speaks with Linda Procci, a former hospital VP and COO who argues that nurses often possess valuable experiences they may not recognize — and may not apply to their understanding of their own skills as a potential board member. “How different is [the strategy employed to improve an organization] from the projects you’re doing on your nursing unit?” Procci asks. Adds Curran: “You know more than you think you know.”

Nonprofit Board Service in Oregon: Opportunities Abound

Nonprofit Board Service in Oregon: Opportunities Abound

By Colin Berry

With more than 10,000 active nonprofits across the state, Oregon’s charitable community is thriving. It includes organizations dedicated to improving everything from social services and health care to the arts, education, and the environment. With a little research and perseverance, a nurse with a commitment to his or her own leadership will be likely to find more than one that reflects their values and personal passions.

Still, their search should start with some basic information. In Oregon, a nonprofit organization is defined as a corporation — one formed under the rules of Oregon Revised Statutes Chapter 65. Our state recognizes three types of nonprofit corporations:

  • The first, public benefit nonprofit corporations, are those that seek to benefit their communities by improving or supporting social services, health care, education, the arts, and other actions to improve the quality of life for one segment of the population. By far the most common, public benefit nonprofits are also the most likely to be created with a board structure in which a nurse can bring perspective, expertise, and leadership.
  • The other two nonprofit corporations comprise religious nonprofits, which are (as you might expect) organizations that include churches, synagogues, and temples; and mutual benefit nonprofits, which are membership organizations. These include homeowners associations (HOAs), social clubs, business leagues, veterans groups. and others.

While nurses who have little or no board experience can certainly gain it by serving in an HOA or church committee, plenty of public benefit nonprofits — the first and most common type — are perfectly capable of providing a solid foundation for building board skills. In a public benefit nonprofit, the nurse’s leadership and larger commitment to community health and the expansion of the influence of nursing can find its roots. It can deepen, strengthen, and grow. The limits to the nurse’s capacity depend on him or her, of course, but also on the organization, its mission, and the structure of its board.

Although Oregon has three types of nonprofit corporations, the term “nonprofit” generally refers to public benefit corporations. Once a nonprofit is formed, it may apply for tax-exempt status from the IRS and state; the Internal Revenue Code creates special provisions for nonprofits deemed “charitable” under code section 501(c)(3). These organizations are often called “501(c)(3) s.” For the remainder of this article, “nonprofits” and “”501(c)(3) s” will refer to public benefit nonprofits which, for nurses seeking board service, are the most common and the most useful to them.

Some nurses may be serve on a nonprofit’s board from the outset. In Oregon, the creation of a 501(c)(3) requires a series of steps, and the first is the selection of the board of directors (“directors” and “trustees” will be used interchangeably here). Unless the organization is a religious or mutual benefit nonprofit, the state requires an initial directorship of at least three people.

After the new nonprofit has chosen a name, prepared and filed its articles of organization, and written its bylaws, it holds its first board meeting — usually referred to as “the organizational meeting of the board.” At this meeting, the new board takes several actions:

  • elects trustees (if not named in the articles of organization)
  • approves its bylaws
  • appoints its officers
  • sets an accounting period and tax year
  • approves initial transactions (i.e., opens a corporate bank account)
  • afterwards, records minutes that reflect the board’s actions

Nurses who serve as a trustee on a nonprofit’s board from the outset are likely to be heavily involved in guiding or supporting the cause in ways that reflect their personal and professional preferences.

But what if you’re trying to land a board position on an existing Oregon nonprofit? The process is quite different.

To start with, your most important action may be to make sure your own ideals align with a 501(c)(3)’s mission and focus. This process of elimination might be easy: Perhaps you already volunteer for (or make regular donations to) a certain cause. Or maybe there’s a cause or charity you’ve always admired, or have friends or co-workers who are involved with. Maybe it’s an issue that’s affected you or your family personally.

What are you passionate enough about to dedicate your time and energy? Healthcare and health-related issues are probably high on your list, but what else? Do you want to help animals? Support underprivileged children? Do you want to lend your time and skills to educational or environmental causes? Nearly any charity in Oregon is likely to derive benefit from having the perspective and experience of an RN on its board; your task will be to find the one or those whose boards are seeking to add new members.

Once you have a clear sense of the focus of the organization you’re seeking, do your research. The Oregon Secretary of State’s office maintains an excellent set of online resources for learning about, searching for, and locating Oregon nonprofits. Start here:

http://sos.oregon.gov/business/Pages/research-oregon-nonprofit-data.aspx

There’s a wealth of data to be found at this site: You can search all active nonprofits in Oregon, filtering your search by keywords in the organizations’ names, location, and type of nonprofit. You can customize or modify your search and export results to a spreadsheet. Clicking on the “Nonprofit Services” tab gives you a good set of frequently asked questions and a good glossary of nonprofit terms. Finally, the OR SOS site also includes links to GuideStar’s national database of nonprofits and this link,

https://justice.oregon.gov/Charities

which delivers helpful search results related to Oregon charities.

Another valuable site is the Nonprofit Association of Oregon, and this page in particular,

http://nonprofitoregon.org/oregon_involved/board_toolkit

which offers an excellent overview on board service in Oregon, as well as a long list of state and national resources for helping nurses (and others) understand all they can about serving as a nonprofit trustee.

Finally, the state of Oregon publishes a helpful overview, the Guide to Nonprofit Board Service in Oregon, which walks the prospective (or new) board member through the basic guiding principles of board service, including focused explanations about trustee’s rights, responsibilities, and liabilities. The Guide is linked to the above online resources and is easily searchable by title.

Oregonians rely on 501(c)(3) s to provide significant support for a number of public benefits. Nurses with a mission to improve health care across their communities and to expand the influence of the nursing profession are likely to find, with a bit of due diligence and determination, qualified nonprofits and their boards of directors who recognize and appreciate the value of the skills and perspectives they bring. Luckily for the RN in Oregon, there’s no shortage of opportunities for engagement, support, and leadership.

Nurses’ Service on Hospital Boards

Nurses’ Service on Hospital Boards

By Colin Berry

For the RN, an obvious place to serve as a director is on the board of your local hospital. Because nurses are an integral part of any hospital’s workforce and key implementers of its policies and procedures, they’re a perfect fit for boards. And they’re more necessary than ever: A 2015 American Hospital Association survey of more than 1,000 hospital boards found that while 1 in 5 board members is a physician, only 1 in 20 is a nurse.

Given nurses’ depth of knowledge and breadth of skills, any hospital would benefit from placing them in its boardroom. Paula Roe, BSN, an operational excellence practice leader at Simpler Consulting, outlines four arguments to support this:

1.

Nurses are a proxy for the voice of the “customer.” Besides comprising the largest single component of a hospital’s staff, nurses also spend the most one-on-one time with patients. From the director to the CNO, nurse leaders know what’s needed for their nursing staff to deliver greater value to their patients — needs they can communicate back to the board.

2.

Nurses are key to implementing the vision of the board. When a board comes up with new policies and procedures, it calls on managers and staff to execute them. When nurses actively participate in board decisions, they understand the intent behind these improvements and can communicate it to others. Buy-in increases.

3.

Nurses are excellent at translation. Besides physicians and healthcare executives, hospital boards typically include business professionals, public service employees, educators, and others without a healthcare background. While it’s not their responsibility to do so, because of their training with the general public, nurses are adept at making healthcare complexities and processes clear to everyone.

4.

Nurses are key to the success of a value-based health care model. The more nurses are engaged with and understand value-based purchasing, the better they’ll be able to identify opportunities to reduce waste. They can speed the transition from fee-for-service to managed health care.

Nurses are a great fit for hospital boards. But how does serving on one differ from serving on the board of a traditional nonprofit organization? To start with, it helps to understand the different kinds of hospitals.

  • Even though about half of US hospitals are run as nonprofit hospitals, their boards operate more like a for-profit company’s. Similar to a corporation, a nonprofit hospital must quantify its value — to the community, not to shareholders — and justify its tax-exempt status. For board members, this can mean taking time to think broadly, clarifying the institution’s value in terms of efficiency and effectiveness by supporting a certain amount of free or uncompensated care — flu shots, blood-pressure screenings, and other health-related benefits, as well as work done by nurses and others in churches, schools, or elsewhere in the community. These benefits are typically accounted for in an annual report.
  • Investor-owned hospitals are for-profit organizations whose value is traded on the stock exchange, operated like any other corporation. (Their boards are, too.) Board members are elected by the shareholders and bound by all the rules and regulations that govern any publicly traded company.
  • Governmental hospitals, which include VA and state university hospitals, have a board structure in which the mayor or governor typically appoints its members. (For more about Oregon governor-appointed boards, see “Governor-Appointed Boards.”) They too are bound by a full suite of regulations and rules.

For any hospital board, transparency is key. A board is responsible for an organization’s financial health; it helps guide senior-level decisions and advocates on behalf of the communities it serves. It’s the norm these days for a healthcare organization to report the contributions it’s making to the community — those measures of efficiency and effectiveness and support — in its annual report. As a board member, a nurse should be prepared to strategize around (and support) these important measures.

Another difference between serving on a hospital board and a traditional nonprofit is the focus on fundraising. Incredibly important to both, a nonprofit board typically spends a good portion of its energy in pursuit of securing future funding. By contrast, a hospital typically partners with large foundations or other established organizations to create long-term financial relationships. While fiscal stability is still of utmost importance to a hospital board, fundraising can often take up less of the board’s time, leaving more of the agenda for addressing issues of policies, procedures, and long-term health strategy.

Finally, be aware that some hospitals, citing the potential for conflicts of interest, don’t allow their employees to serve on their own boards of directors. This shouldn’t deter the nurse determined to get on one, however: Often there is space on one of the hospital’s advisory committees or some other advice-giving entity; sometimes the hospital board across town is the perfect place to bring a nurse’s perspective on issues of health and wellness affecting the community.

Lawrence Prybil, a professor in Health Care Leadership, suggests that health care executives can be slow to acknowledge the impact of nursing on patient care quality. Nurses, he says, are more often viewed as mid-level technicians rather than skilled professionals whose impact on patient care is enormous. “Nurses have to believe they can make a difference and work hard to prepare themselves for leadership positions,” he says.

A hospital board may not be the first stop for a nurse seeking to be a board member. For those stepping into their initial leadership role, it may make more sense to join the board of a traditional nonprofit, start-up, or another body where the stakes are lower and the agenda simpler. In time, however, service on a hospital board should be the goal of every nurse leader — anyone with “RN” after their name who embraces a larger vision of the future for compassionate care.

Nurses as Stewards of the Boardroom

Nurses as Stewards of the Boardroom

By Colin Berry

If you’re an RN intending to serve — or already serving — on a board of directors, here’s a secret no one may have told you: Board service will require you to broaden a certain set of skills. The good news is it’s something nurses in particular can comfortably learn to do.

As a governing body, a board’s job is to govern. This means providing leadership and strategy that reflects an understanding of the organization’s big picture — its long-term goals, its intentions, its abiding mission and vision. For the board, governance requires its members to create the framework for accomplishing this and, as such, stands apart from both management (organizing the work) and operations (doing the work). By definition, an organization’s board provides governance, leaving managerial decisions to its managers and day-to-day implementation to its staff or employees.

Sounds pretty straightforward, right? Yet consider most nurses’ innate abilities. Nurses are by nature do-ers — active, engaged team members and natural problem-solvers who aren’t afraid to roll up their sleeves and get to work fixing something that needs to be fixed. They’re natural operations people. And while it’s also in the nurse’s nature to be a keen strategic thinker — particularly in a moment of crisis — her (or his) profession is one that often lends itself to the kind of person who gets things done.

While there’s nothing wrong with that, a nurse who serves on a board needs to remember: In the boardroom, you’re a board member first and a nurse second. Your natural aptitude for operations must be secondary to the leadership and perspective you bring as a member of the board.

Typically, in a large organization, it’s easier to maintain these boundaries: The governing body governs, the CEO and senior management team manages, and the staff and volunteers take care of operations. In smaller organizations, however (and especially in nonprofits that lack paid staff), it can be much easier for the board to get mired in decisions regarding short-term management and operations — and to lose sight of their strategy and their focus on the big picture.

Things work best if everyone does their job. As startups and small nonprofits grow and expand their staff, it’s important that board members — who may have been accustomed to “pitching in” — concentrate 100% on their governance role, allowing others to take responsibility for the jobs for which they were hired.

A better way of saying this is that your perspective as a professional nurse should inform your role as a board member. In “Nurses in the Boardroom,” Kimberly McNally, MN, RN, BCC, a consultant that serves on a number of boards, explains: “Nurses bring a front-line perspective on engaging employees and important insights on discussions related to future workforce needs. They understand that health care’s business model is based on the premise of people caring for people. They also bring a patient- and family-centered lens to decisions about capital improvements and the impact of facility design on care.”

Especially for the new nurse on board, it’s a balancing act: keeping a check on the natural tendency to get involved with day-to-day business while contributing from a perspective gained through experience as a professional RN — bringing the nurses’ viewpoint to the board’s broader discussions of strategy and governance.

Here’s a good rule of thumb:

Governance creates the mission, purpose, direction, and goals of the organization; it develops policies on operations, grantmaking, fiscal oversight and investment; it oversees the strategic plan and the organization’s overall performance.

Management implements the organization’s mission, strategic plan, and board-approved policies; it attains goals set by the board, supervises staff, and directs the organization’s day-to-day operations

One more thing: As a board member you’ll hear a lot about duties — Duty of Care, Duty of Loyalty, Duty of Obedience, and others. Understanding these core legal duties will help you fully step into your board role. (The Oregon Department of Justice publishes a valuable document, “A Guide to Nonprofit Board Service in Oregon,” which outlines them.)

The Duty of Care. This duty focuses on how trustees act and make decisions rather than the results of their decisions. It requires a director to discharge the duties with the care an ordinary person in a similar position would exercise under similar circumstances. Directors need not always be right; it’s that they must act with common sense and informed judgment.

The Duty of Loyalty. This duty requires board members to safeguard the organization’s business interests. Decisions regarding the organization’s funds and activities must promote the organization’s public purpose rather than private interest. The board should closely scrutinize any potential conflict transactions with the understanding that the public will likely be skeptical of them.

The Duty of Obedience. This duty requires board members to comply with all applicable laws, regulations, and rules, as well as to follow the organization’s governing documents. It’s the most important duty of all, because if a board doesn’t comply with the laws and regulations, the other two Duties are irrelevant.

Whether corporate or nonprofit, the board you’re hoping to serve on — or are serving on today — recruited you for a specific reason. It’s likely that you bring a particular flavor of credibility or a valuable specific viewpoint to it: the perspective of the professional RN, with all his or her attendant expertise. Yet whatever the reasons for service, your principal role as a board member is to be a steward and an ambassador for the organization — to steer it on a clear course in alignment with its stated mission and purpose.

Your Leadership Presence

Your Leadership Presence

By Colin Berry

There are as many flavors of leadership in the world as there are leaders — from charismatic to collaborative, from team players to tyrants and everyone in between. What’s your leadership style? Board service puts a diverse group of leaders in a room together and asks them to function efficiently, to make room for everyone’s contributions, and to efficiently guide an organization— no matter their members’ backgrounds, status, gender, or tenure on the board.

If you’re a nurse joining your first board — or your fifteenth — your relationship to leadership will have an undeniable effect on 1) the degree to which you are heard, understood, and respected among your peers, and 2) your ability to steer and influence the board’s decisions. And without plenty of the first, you’re unlikely to experience the second.

So what does your own leadership look like? There are thousands of leaders, and leadership books, and coaches and gurus and seminars and workshops. But the truth is that your own leadership won’t fully emerge until you’ve had a chance to practice. You’ll probably lead imperfectly at first, but with time and experience your leadership can become something you embrace and embody — in a flavor that fits you best.

The phrase “leadership presence” is used to describe who you are and how you act in your role as a leader. With awareness and practice, leadership presence can improve. And while an awareness of your presence by itself won’t necessarily make you a better leader, it can make you more respected in the room — and, as you gain experience, your effectiveness as a leader is likely to catch up. Presence requires being conscious of your own internalized authority and physicality in the boardroom, and the effect it has on others.

Following are a few suggestions for becoming aware of (and potentially improving) your leadership presence.

 

  • Be prepared. It goes without saying that digesting all paperwork and any other prep for board or committee meetings will improve your leadership presence. You’ll be more relaxed and effective during discussions; others will notice.
  • Lead by example. Be the kind of board member you want to work with: informed, respectful, patient, productive, collaborative. Listen more and speak less — but speak firmly and clearly when your perspective is warranted.
  • Know how to ask questions and give feedback. Asking for more data around an issue is different than posing a question that’s dripping with judgment. Recognize the difference and utilize it. Remember when giving feedback to wrap any criticism between a pair of genuine compliments.
  • Interact with intention. Join your fellow directors in moving towards solid points of clarity and progress. Build ideas and plans with them in the moment, with clear objectives for the future.
  • Understand that you have a right to be there. Your experience with a particular matter gives you the authority to speak about it. It’s why you’re on the board.
  • Make room for everyone — including yourself. The best leaders value others’ perspectives, yet aren’t afraid to take a stand for what they truly believe…even if they’re the only ones who do.
  • Jettison your minimizing behaviors. Sit up straight. Speak clearly and confidently. Look others in the eye. Don’t fidget.
  • If you get interrupted, respectfully reclaim your right to speak. Be aware that group dynamic patterns get established early; don’t let the interruption of you become the norm. (And extra credit for calmly and firmly standing up for others who’ve been interrupted.)
  • Stand in your leadership, not your do-ership. You might know exactly how to do something that’s being talked about. Still, make sure you’re on the board for your leadership, not your labor.
  • Be aware of others’ reactions to your presence. If you’re feeling a cold chill from another trustee or director, take the initiative to connect with them outside the boardroom. How can the two of you become more effective peers?
  • Get yourself a mentor. If you’re a newbie, find a mentor who can guide you on your budding leadership. Sit next to them in meetings. Afterwards, ask for honest feedback on your leadership presence. Then adjust.

Your leadership presence is something that can be identified, fine-tuned, and improved. It’s like any behavior pattern. Consciousness is the key. Committing to becoming aware of it — and to addressing it — will complement your up-and-coming leadership skills. Remember that few human beings are “born leaders”; they’ve all had to work to better understand their own physical and behavioral habits on their path to becoming someone others will follow.

Governor-Appointed Boards

Governor-Appointed Boards

By Colin Berry

In Oregon, the Governor appoints the members of more than 250 boards and commissions. These bodies represent a broad range of areas and issues critical to the state, its natural and human-made infrastructure, and the people who live here.

The nurses, teachers, scientists, and professionals from a wide variety of industries who serve on these boards are vital participants in statewide decision-making, with an opportunity to steer and effect many of the state’s governmental policies. From the Board of Accountancy to the Youth Conservation Corps Commission, these bodies can provide a powerful setting for the nurse’s voice. Are you a nurse who’s interested in Athletic Training? DUII laws? Fire Service Policy? Motorcycle Safety? No matter what your interests are, there’s likely to be a board where you’ll fit. (Here’s a full list of them.)

In Oregon, there are five main types of boards. Each is created to meet a specific need in the management of the state’s government. For the nurse, interest in (and, eventually, qualification for and appointment to) a particular type of board will reflect your own experience, expertise, or passion around this need.

1.

Policy-making boards get statutory power from the legislature to make policy decisions and enforce regulations. They develop policy by interpreting legislative intent or in officially adopted administrative rules, and by implementing procedures to carry out those laws or rules. Those who serve on policy-making boards are generally final decision-makers, accountable to the public through the Governor.

2.

Some policy-making boards are also Governing Boards, which are responsible for directing a state agency and/or for appointing the agency’s director.

3.

Advisory Boards may be created by the Governor, legislature, state agencies, or existing boards to serve as collective advisors on policy matters. They look closely at current policy to make recommendations for change or implementation. Although they don’t have final authority to make or enforce rules, their research — and the advice they give to decision-makers — can contribute to effective changes in state government. Many nurses will find a potential board spot on them.

4.

Licensing Boards examine and license members of a profession or occupation to practice in Oregon. Some have the power to discipline members of the regulated profession or occupation, and to suspend or revoke their licenses.

5.

Judgment Boards are created by the legislature as review and appeals boards which hear and rule on individual cases. The decisions made by most of these and all other boards may be appealed to a higher court.

For the nurse considering it, an appointment to a state board or commission is based on specific needs, expectations, and policy goals. Most seats are volunteer positions that require 10–15 hours of work per month. Although some boards or commissions have a need for specialized skills, most nurses can find one that’s an excellent fit for their knowledge base. And while members aren’t required to have ongoing experience in a specific topic area, they should have a general interest, and board service is a good opportunity to learn more about an aspect of governing — and to contribute a view — that’s fresh and unique.

If you’re interested being appointed to a Governor-appointed board or commission, the process is straightforward.

  • Start at this overview page, where you can learn more about each board and commission — each has its own website — and look over the useful Boards & Commissions Book, which describes most of the boards to which the Governor makes appointments.
  • For a broader background, page through the Membership Handbook, which provides a general overview of board service and board activities.
  • All Oregon board and commission meetings are free and open to the public, so if it helps your decision process, plan to attend one.
  • When you’re ready to choose a board, go to the Application Page, where you can browse a current list of current board expirations and vacancies.
  • Complete an Interest Form, which gives you a chance to talk about your nursing background and why you want to participate. (You must be al legal, tax-paying Oregon resident to qualify for appointment.) You can also apply by mail.

You can apply anytime, regardless of whether or not there’s a current opening, since resignations occur throughout the year. Like all applicants, you’ll be subject to a background check and additional vetting for certain board positions.

Once you’ve submitted an Interest Form, the Boards and Commissions Office will keep it on file for two years. Submitting a form doesn’t mean you’ll be contacted (although you will receive acknowledgment of its receipt); the Office will reach out to you directly if you’re being actively considered for appointment.

As you consider this option for board service, be aware that the Governor is committed to ensuring that all boards and commissions accurately represent the age, racial, and gender diversity of the state’s population in their membership. There’s space for you. For nurses, appointment to a Governor-appointed board or commission marks a significant opportunity to serve — and to be an active part of a broad and influential source that’s providing collection of viewpoints, visions, and direction for the state.

Nurses Improve Boards. BoardRoom Press Highlights Why

Nurses Improve Boards. BoardRoom Press Highlights Why

The Governance Institute, dedicated for decades to the oversight of health care organizations, has over three months offered three separate takes on the value of nurses serving as board members. The author sharing a byline on all three knows the subject well: Laurie Benson, BSN, is executive director of the Nurses on Boards Coalition.

Where can a nurse help most as a director? Everywhere, and for multiple reasons, as the three articles on the Governance Institute’s BoardRoom Press detail.

Throughout the Community

“Through their volunteer appointments on community boards, philan­thropic organizations, governmental task forces, and commissions, nurse leaders carry their substantial expertise into the boardrooms of community organi­zations across the nation,” write Benson and Kimberly Harper, MS, RN, in a piece that includes interviews with leaders from various industries saying how a nurse’s board service builds healthier communities.

Harper is the chief executive officer of the Indiana Center for Nursing and nursing lead of the Campaign for Action’s Indiana Action Coalition. She is also national co-chair of the Nurses on Boards Coalition.

As a director, a nurse can help the board steer a wise course. Equally important: The collaboration with neighborhood agencies inevitably gives the nurse additional experience and partnerships that benefit the organization he or she works for.

To Help the Patient Experience

Benson also co-authored an October piece, “Improve the Patient Experience—Ask a Nurse to Join the Board.” Sharing the byline was Sue Hassmiller, RN, PhD, FAAN, senior adviser for nursing for the Robert Wood Johnson Foundation and director of the Future of Nursing: Campaign for Action. Hassmiller and Benson address hospitals and health care systems, writing, “Inviting more nurse leaders to the boardroom will improve the board’s effectiveness and efficiency in addressing the compelling business case to improve the patient experience.”

To Advise on Care Coordination

Complementing those two pieces is an article in December that assesses the need for oversight and coordination for those undergoing transitions in care—the post-discharge period of time when someone might need assistance among rehabilitation, long-term care, or skilled nursing facilities, as well as home health care. Nurses should have a strong say here, too: “Given nurses’ ability to ensure patients receive coordinated care across the continuum, they are well positioned to advise boards about partnering with post-acute providers,” write authors Benson and Marla J. Weston, PhD, RN, FAAN, chief executive officer of the American Nurses Association.

The Nurses on Boards Coalition that Benson oversees was founded in 2016 by AARP, RWJF, and 18 nursing organizations. Its goal is to get 10,000 nurses on boards by the year 2020—boards of hospitals and health care systems, yes, but also of community organizations, businesses, agencies, schools, and associations. As the series makes clear, the nature of the work they do means nurses bring a unique perspective to decision-making, one that can lead to better governance.

 


 

Source: Campaign For Action, Feb 2017

The Value of Placing a Nurse on Your Board of Directors

The Value of Placing a Nurse on Your Board of Directors

For Profit, Non-Profit and Government Board Benefits

 

Qualities & Skills Nurses Contribute:

 

Ethics & Integrity
Nurses are voted #1 most respected and ethical profession.
(Gallup Poll results 13 years)

 

Problem Solving/Critical Thinking
Nurses are problem solvers and critical thinkers who use a systems perspective to assess situations and offer comprehensive solutions.

 

Budgeting & Staffing
Nurses at all levels of administration know how to manage budgets and staff and are attuned to the effectiveness of their budget.

 

Results Oriented/Accountable
Nursing is an evidence based profession that uses measurement and outcome data for decision making.
Nurses work hard to get the job done under pressure and done right.

 

Team Players
Nurses work well with others while communicating value for each member of the team.

 

Health Promoters
Nurses are knowledgeable about the social determinants of health and how to promote the health of individuals, families and communities.

 

Consider adding a nurse to your Board Team today!

 


Prepared by Aila Accad, RN, MSN, Executive Director and Laure Marino, Lead Nurses on Boards Initiative, Future of Nursing WV

Nurses in the Boardroom

Nurses in the Boardroom

by Kimberly McNally

Transformational change is occurring rapidly as hospitals and health systems move to value based care delivery focused on the Triple Aim — better care, better health and lower cost. To achieve these aims, exceptional leadership at the CEO and board levels is essential. Governance experts suggest that high-performing boards are composed of individuals with a variety of professional backgrounds, life experiences, and personal characteristics to ensure that diversity of opinions and independent thought are present during important deliberations.

A board member/trustee with a nursing background brings a unique voice to governance conversations focused on the Triple Aim. Nurses bring expertise in and valuable perspectives about community health, quality, safety, patient experience, workforce development, staff engagement and financial stewardship. Nurses can offer new ideas to address challenges and frame opportunities as health care transformation occurs. This article discusses the value nurses bring to the boardroom and suggests ways to recruit a trustee with a nursing background.

Value of the Nursing Perspective

Nursing leader, university professor, and past AARP (formerly the American Association of Retired Persons) board chair, Joanne Disch described a specific viewpoint or “nursing lens” that nurses bring to decision-making. This lens is a way of thinking informed by understanding people and their needs throughout the lifespan, and by understanding issues from a systems perspective, coupled with a set of interpersonal skills to engage diverse stakeholders.1

The 2011 Institute of Medicine’s (IOM) report The Future of Nursing: Leading Change, Advancing Health emphasizes the importance of nurse leadership in improving America’s health care system: “By virtue of its numbers and adaptive capacity, the nursing profession has the potential to effect wide-reaching changes in the healthcare system. Nurses’ regular, close proximity to patients and scientific understanding of care processes across the continuum of care give them a unique ability to act as partners with other health professionals and to lead in the improvement and redesign of the health care system and its many practice environments.” The report states that “Private, public, and governmental healthcare decision makers at every level should include representation from nursing on boards, on executive management teams, and in other key leadership positions.”2

In their Journal of Healthcare Management article, “Nurse Leaders in the Boardroom: A Fitting Choice,” authors Hassmiller and Combes state, “As hospitals and health systems explore how to meet the challenges of the coming decade, they would be well-served to realize the breadth and depth of skills and capabilities that nurse leaders can bring to board positions.”3 The American Hospital Association’s (AHA) Center for Healthcare Governance recommended that boards “include physicians, nurses and other clinicians....Their clinical competence and viewpoints are valuable to other board members and will help the board better understand the needs and concerns of several of the organizations’ stakeholders.”4

Ensuring high-quality, safe care is both a fiduciary and strategic responsibility of hospital boards. The board sets the organization’s culture and ensures the resources necessary for physicians, nurses and other team members to carry out the quality and patient safety vision. Nurses bring to the board an essential point of view on safety, quality, and patient experience – all critical to producing high-value outcomes. Without physicians, nurses and other clinicians serving on the board, oversight for quality and safety performance runs the risk of being hampered at best and misguided at worst.

Hospital boards play a role in facilitating strong partnerships in the community. Nurses understand what it takes to build trusting relationships with others to facilitate effective community partnerships. Nurse leaders ensure that policy and financial decisions are made from the perspective of those receiving and providing care. They bring their deep knowledge and experience with patient care delivery and community health to the board table. Nurses have experience with building care management systems and know the importance of integrating physical and behavioral health and addressing the social determinants of health, such as lack of education and poverty. Nurses know the challenges associated with care transitions and the importance of promoting wellness and preventative care. They also have experience with direct observation of populations of patients in need, gaps in care and services, and barriers and challenges to delivering services.

Nurses bring a front-line perspective on engaging employees and important insights on discussions related to future workforce needs. They understand that health care’s business model is based on the premise of people caring for people. They also bring a patient and family centered lens to decisions about capital improvements and the impact of facility design on care.

Nurses are Under-represented on Boards

While nurses serve in leadership roles in many settings and can add significant strength to governance conversations, they remain largely absent in boardrooms. A recent AHA survey of more than 1,000 hospital boards found that just five percent of board members were nurses; while 20 percent were physicians.5

Despite recommendations to add more nurses to boards, little progress has been made. The AHA’s 2014 National Health Care Governance Survey Report noted “…while clinical representation is essential as hospitals strive to continually improve quality and patient safety, the percentage of clinical board members has declined.” Researcher Lawrence Prybil has studied governance best practices extensively and advocated for engaging nurses in governing health care organizations for a number of years. He suggests several barriers leading to this under-representation including gender disparity in boardrooms, a lack of awareness of nursing’s impact on health care quality and misperceptions about nurses lacking preparation for board service.6

Specific concerns sometimes surface in conversations about adding nurses to the board. Comments that reflect these concerns and my responses to them appear below.

  • “We already have several physicians on the board who provide clinical input” – Nurses bring a separate and distinct perspective that is complementaryto the physician viewpoint. We’re not focusing on bringing more nurses into governance to balance the input physicians provide to the board, but rather to augment and add to the perspective shared by physicians.
  • “The Chief Nursing Officer attends the board meeting, isn’t that good enough?” – The CNO is a vital member of the senior management team and should attend and contribute to board and committee meetings. However, the CNO is an employee of the organization and cannot serve as an independent director.
  • “If we appoint a nurse, he or she will act as a representative for nursing rather than focus on the needs of the entire organization.” When nurses are prepared for board service they understand their role and can make their optimal contribution on behalf of the entire organization. Of course, this response applies to any professional. I have never heard anyone say, “If we appoint an accountant, he or she will act as a representative for the finance department, rather than focus on the needs of the entire organization.”

Even board members and CEOs who understand the value of recruiting a nurse to serve on the board ask, “Where would we find someone?” Many nurses hold executive positions in health care organizations; lead quality improvement initiatives; serve as expert clinicians, researchers, policy analysts and consultants across health care settings; and have deep expertise in myriad clinical, operational and systems issues. Hospital boards in small communities might consider recruiting a nurse from outside the community or from the local college. Looking for a recently retired nurse leader interested in contributing to the community may be another option. The American Nurses Foundation is creating a database to match qualified nursing leaders with boards. Organizations can submit a request to http://anfonline.org/nurseboardleadership.

Increasing the Number of Nurses on Boards

Nurses across the country are preparing themselves to serve on hospital and community boards. In response to the IOM report, The Future of Nursing: Leading Change, Advancing Health (2011), which recommended nurses play more pivotal roles on boards and commissions in improving the health of all Americans, other important efforts are underway.

At the national level, the Nurses on Boards Coalition, supported by the Robert Wood Johnson Foundation and AARP, is implementing a strategy to bring nurses’ valuable perspective to governing boards and to state and national commissions with an interest in health. The goal is to put 10,000 nurses on boards by the year 2020. The coalition was founded by 21 nursing and health care organizations, including the American Nurses Association, American Organization of Nurse Executives, National League for Nursing and Sigma Theta Tau International. Its aim is to increase the presence of nursing on
health-related boards.

At the state level, nursing leaders are working to provide educational opportunities and networking for nurses aspiring to serve on a community or hospital board. For example, The Texas Team Action Coalition, working in collaboration with Texas Healthcare Trustees, launched an effort in 2013 to equip nurses with the governance skills needed to succeed in board positions. The coalition is offering their program in each of eight Texas regions, with the goal of preparing 400 nurses statewide for board service. In New Jersey, nurse leaders’ resumes have been collected and catalogued in a database housed at the state hospital association and are used to match candidates with organizations looking for nurses to serve on their boards. The Arkansas Action Coalition (AR AC) has created a list of nurses serving on community boards and organizations. Talking points about the value of nurses on boards are shared at professional nursing meetings across the state. New trustees with a nursing background have been paired with an informal mentor from the AR AC leadership team.

What Can Health Care Organizations Do?

As hospitals and health systems focus on achieving the Triple Aim, recruiting and selecting a nurse for board service will add an important voice to governance work. Nurse leaders have the education, clinical practice, leadership experience and personal characteristics to help the board balance the business of health care with clinical and patient outcomes and add value to board discussions about health care transformation and community health improvement strategies.

By adding at least one nursing professional to the governing board, hospitals and health systems can join the ranks of forward-thinking organizations better equipped to govern for advancing health in their communities.

Kimberly McNally, MN, RN, BCC, serves as a board member of the American Hospital Association, Health Research and Education Trust, UW (University of Washington) Medicine and Seattle Cancer Care Alliance. For the last 18 years, she has led McNally & Associates, an executive coaching and consulting firm serving health care leaders, teams and boards. She can be reached at kamcnally@me.com.

1 Disch, J., “The nursing lens”. Nursing Outlook, Volume 60 , Issue 4, 170-171, 2012.
2 Institute of Medicine (IOM). 2011. The Future of Nursing: Leading Change, Advancing Health. Washington, DC: The National Academies Press.
3 Hassmiller, S. and Combes, J. “Nurse Leaders in the Boardroom: A Fitting Choice,” Journal of Healthcare Management 57:1 January/February 2012.
4 AHA’s Center for Healthcare Governance. Building an Exceptional Board: Effective Practices for Health Care Governance. Report of the Blue Ribbon Panel on Health Care Governance. Chicago: AHA’s Center for Healthcare Governance; 2007; p. 13.
5 AHA’s Center for Healthcare Governance. National Health Care Governance Survey Report: 2014. Chicago, IL: Center for Healthcare Governance; 2014,11-14.
6 Prybil, L., Nursing Engagement in Governing Health Care Organizations Past, Present, and Future, Journal of Nursing Care Quality, 2016, Vol. 00, No. 00, pp. 1–5.

Financial Management

Financial Management

Whether a nonprofit, governmental, or corporate board, finances sit at the heart of its concerns — how much money comes in and how much goes out. Directors or trustees are expected to maintain the organization’s financial accountability, and have a fiduciary duty to remain responsible and objective (as well as trustworthy and honest) while they act as trustees for the organization’s assets. They must exercise reasonable care in every decision they make so as not to put the organization at any unnecessary risk.

For nurses who serve on boards, knowing a few financial basics will make the difference between being effective and being potentially misinformed, confused, or overwhelmed. Nurse or not, it is essential that directors understand basic financial terminology, are able to read financial statements (and have a clear sense of their soundness), and have the capacity to recognize warning signs that could indicate a change in the organization’s overall financial health. If there is something a board member doesn’t understand, he or she must be willing to ask in order to get an answer.

With a nod to Andrew Lang’s book, The Financial Responsibilities of Nonprofit Boards, following are a handful of questions a director or trustee might consider in order to gain a clearer idea of the organization’s financial standing:

  • Is our financial plan consistent with our strategic plan?
  • Is our cash flow projected to be adequate?
  • Do we have sufficient reserves?
  • Are any specific expense areas rising faster than their sources of income?
  • Are we regularly comparing our financial activity with what we have budgeted?
  • Are our expenses appropriate?
  • Do we have appropriate checks and balances to prevent errors, fraud, and abuse?
  • Are we meeting the guidelines and requirements set by our funders?

Knowing the answers — and the details that accompany them — will provide even the most inexperienced board member a clearer snapshot of the organization’s financial picture. While a nurse who sits on a board isn’t expected to be a financial expert, his or her ability to balance a checkbook, manage a household budget, make investments in a 401K or a house, and apply for a standard loan will already provide enough about the basics to follow the topography of a board’s financial discussions.

Still not convinced? Here’s a nugget from Connie Curran, from her book Nurse on Board: Planning Your Path to the Boardroom:

“Joanne Disch, former academic executive, professor, and seasoned board member, notes that nurses bring value from a financial standpoint in a more qualitative way as well. ‘Sometimes I think that people who only have financial acumen really don’t understand how you calculate other costs, such as reputational costs or loss of morale or community push-back,’ she says. ‘I think nurses bring that idea that, yes, the traditional way of looking at finances is necessary, but it’s not enough.’”

That’s exactly the takeaway when it comes to each board director’s ability to understand and discuss financial matters: A nurse’s natural curiosity, paired with her or his innate ability to quickly gain a basic understanding of a subject, are characteristics that, while no substitute for the experience a veteran CFO or a career accountant brings to a board, are as worthy and useful in steering, contextualizing, and better-aligning the mission, purpose, or big-picture perspective of the board’s parent cause or company.

Succession Planning

Succession Planning

By Colin Berry

Ask any RN who’s served on them: Boards whose membership reflects a diversity of ages, genders, experience, and professional backgrounds are more conducive to healthy debate and clear-eyed decision-making; they’re also less susceptible to groupthink. But there’s another factor that indicates a high-functioning board: one that plans for succession — the turnover of members who’ve served and the successful recruitment of new ones.

There’s a sweet spot for the balance of board turnover, one that’s unique to every organization. While some boards run smoothly with a steady, slowly changing roster, others are energized with a constant influx of new members with new perspectives and experiences. In general, research shows a positive correlation between some amount of regular board turnover and organizational performance. That doesn’t mean most boards do it, though: A recent study by PricewaterhouseCoopers found that 40 percent of directors believe that someone on their board needs to be replaced.

In the past, most boards approached succession without much forethought. They began considering new members only when the old ones announced their retirement and (on corporate boards in particular) chose for new candidates from familiar business circles.

Today it’s different, and that’s good news for nurses. Smart organizations anticipate succession, plan for it, and keep a constant eye out for new candidates across diverse professional and philanthropic communities. And RNs are more often a part of that search.

A nurse who serves on a board’s nominating committee can bring his or her organizational skills to the process. Here’s one way a board can plan for healthy succession:

1

Start by making a board matrix. List your directors down one side and their skills experiences across the top, as well as any attributes — gender, ethnicity, etc. — that reflect their full cultural competency. (Be aware that some attributes will be universal for every director on your board.)

2

To this, add the skills that reflect your organization’s strategic plan. There may be more of these than your current board members possess. Don’t judge the results — they’re merely data you can use in the next step.

3

Identify the gaps. Where is your board in need of skills or experiences that its current roster doesn’t provide? In order to fulfill its corporate or philanthropic mission, the board will need to expand its search for candidates with those skills.

4

Create a list of prospects. Based on your gaps, do your research, expanding beyond the circles your board members normally spend time in. Who’s done a knockout TED Talk? Who’ve you met at a nursing conference? Should you employ a board search firm? This part of the process is only limited by the committee’s degree of creative thinking. Constantly update your list of prospects.

5

Focus the list and start reaching out. Get to know potential candidates and their possible “fit” long before you’re ready to hire them. Meanwhile, keep the dialogue open with your current directors about their own intentions. Are any planning to step off the board soon?

6

Ensure that current members are performing well. Directors eligible for re-election shouldn’t automatically be considered — make sure they’re still committed to the organization. Look at their past performance: Do they attend meetings? If they’re part of a nonprofit board, do they “give or get” their annual donation? If your board doesn’t have term limits, is it time to add them to your bylaws?

7

Hire or appoint smartly. By the time a new member is on-boarding, be satisfied that you’ve found a good match: a candidate who fills a gap (or gaps), is committed to your mission, and clearly works well with others.

8

Be transparent about the process. The succession process should be clear and consistent and its procedures should be understood by everyone on the board. Review it often — make it clear that your top priority is and always will be the guiding principles of the cause or company.

The bottom line? Nurses who serve on boards that seek to be more visionary, more strategic, and more accountable should advocate for adopting a proactive succession planning process — one that prioritizes individual director performance, aligns board member skills with the organization’s strategic plan, and limits the terms of its members.

Fundraising

Fundraising

By Colin Berry

If you’re a nurse that serves on the board of a nonprofit, you already know that fundraising is a big part of the job. From buying tickets to the organization’s yearly gala to actively supporting its year-end or capital campaigns, to making (or raising) a significant annual donation of their own, trustees are expected to pitch in strongly to bring in money in support of their nonprofit’s programs.

The smaller the organization, the greater the importance fundraising plays, and pressure to do so can feel daunting. The stress of meeting quarterly or yearly fundraising goals often claims a big chunk of a board’s time and energy. And while grants, endowments, and corporate gifts can bring in some funds, the biggest challenge for most board members is the ability to ask potential individual donors to give their money to the cause. Few are good at making the “ask.”

But here are three pieces of good news: First, raising money is a skill that can be learned, and plenty of trustees convinced they weren’t good at fundraising have become skilled at it. Second, in 2015, the vast majority of contributions in the US — a whopping 71% — come from individual donors; as always, it’s a clear source of support. (Foundations, bequests, and corporations brought in 16%, 9%, 5% respectively.)

The third piece of good news is that average nurse already possesses natural qualities that can make her or him skilled at fundraising, often in unexpected ways. Let’s look at a few of them through the lens of being an effective fundraiser.

  • Empathy. Your innate understanding and compassion for others’ pain and suffering is a strong skill to have when talking to prospective donors about a cause you support. Which stories can you convey about your beneficiaries’ needs? Which can you tell about how they’ve benefitted from the nonprofit’s work? Putting faces and real stories on those your cause supports can change the discussion from one that’s about money into one that’s about empathy. It’s often the quickest way to connect with a potential donor.
  • Interpersonal skills. Nurses typically possess excellent people skills — skills they take for granted yet which serve them well as they interact with new or established supporters of their cause. A nurse understands the importance of being pleasant, as well as how to acknowledge varying (and sometimes competing) needs simultaneously. Nurses are also respectful and persistent — all qualities excellent fundraisers have plenty of.
  • Communication skills. Related to this, good nurses are strong advocates and active listeners — perfect for understanding a potential donor’s questions — and they’re generally clear when they write or speak. They’re natural problem-solvers, too. Their reputation for trustworthiness is well deserved: They understand the importance of accurate information, clearly and directly conveyed. What better qualities for a chat with someone about something as emotionally charged as money?
  • Attention to detail. Targeting individual donors can be a byzantine undertaking. Tracking calls and donations, keeping tabs on thank-you notes, initiating follow-up letters and emails — it can be overwhelming. Whose name was duplicated on the mailing list? Whose is misspelled? A nurse’s aptitude for managing details makes him or her the perfect candidate for creating and/or maintaining a database or other system for donor management.
  • Endurance, stability, and flexibility. Nursing is a stressful job. Fundraising can be, too. They’re different of course, but nurses’ experiences in the ward or hospital make them hardy, flexible, and resilient. A “no” from a potential donor doesn’t necessarily slow them down; like any other situation, they dust off, gather their courage and resolve, and jump back into the next name on the list.
  • Natural problem-solving skills. Nurses are adept at thinking on their feet. A snafu in the database? A tricky question from a prospective donor? A typo on the donor list? A cool-headed nurse is likely to have an answer that’s quick and effective, that reflects big-picture thinking even as it addresses the detail in question.

Nurses bring a particular flavor to nonprofit boards, and their contribution to fundraising can be both subtle and significant. Although they may not join the board highly skilled as a fundraiser, their unique skillset can soon have a positive effect on the organization’s money-raising efforts.

How to Choose a Board

How to Choose a Board

By Colin Berry

Nurses embarking on a path to board service will be served well with some focused goal- and intention-setting in order to land their first position as a trustee, director or committee seat. The process may take time, so it’s a good idea to plan your journey. But how to choose the board you’re targeting? You may want to consider several factors — and the following sequence — as you begin.

1.

Start by making a list of qualities you bring to a potential leadership position — and don’t sell yourself short. Most RNs possess strong organization, time management, communication, human relations, and general management skills. They typically are attuned to quality and safety needs, understand the importance of continuum and consistency of care, and bring a holistic, humanistic perspective that is rare for most professions. They react calmly in crisis and are creative thinkers by nature. Many nurse managers oversee budgets, and can bring an understanding of financial issues to a board.

What are your unique qualities? What are you good at? What are you passionate about? Beyond your profession, what other expertise do you bring? Parenting skills, volunteer work, life experience, previous careers — all can potentially enhance your chances for joining a board. Think strategically, highlighting the qualities you have in order to attract the position you want.

2.

With those unique qualities in mind, make a list of companies or causes that are meaningful to you, and be ready to talk about your passion by the time you get your first interview. Do you feel strongly about a certain health issue? A particular population? A specific disease? Are you passionate about new medical technologies? Health care in general? Remember that as a nurse who’s new to board service, you don’t necessarily need to align yourself with health care per se — your local school board, homeowner’s association, church board, or animal rescue nonprofit are all legitimate jumping-off places to gain board experience. Whether it’s your first or your fifteenth board, however, its parent organization must mean a lot to you; your passion about the cause or the company should set you apart from other board candidates.

3.

With your qualities clear and organizations in focus, it’s almost time to network like crazy. Prepare by tightening up your LinkedIn profile, focusing your résumé, making a list of every possible contact who might be of assistance…then…GO! Reach out to everyone on your list. Attend networking events. Take others to coffee or lunch. Get the word out. Be thorough, be exhaustive, and be specific about what you’re asking for — an introduction they can help you make to the position, cause, or company that’s best for you.

Again, think strategically: How can you connect with the people who can connect you with the organization(s) at the top of your list?

Simultaneously, consider learning more about board service. The more you know about governance, the better your chances of finding — and performing well on — your first board. A workshop to help you better understand the differences between boards? A class on the specific issues boards face? A seminar on how to interview for a board position? If it applies, a workshop on how to navigate the challenges women face on boards? Any preparations you make will improve your chances with the committee that’s considering hiring you for their board.

4.

Get help if you need it. The right recruiter can help you find a board position — don’t hesitate to reach out and ask. Similarly, if you have friends or colleagues who already serve on boards, ask them how they did it and whom you might speak with for support. Be proactive and don’t be afraid to ask for help. If you’re already serving on a board, ask other board members — they’re likely to be affiliated with other organizations.

5.

After your research, after your networking, after your interviews, when the first offer comes from the first board, take a deep breath and choose wisely. Joining a board is an important, long-term commitment. It comes with personal and professional liability and calls for many hours of service. In the case of most nonprofits, it requires some type of financial or fundraising commitment. Don’t just accept the first offer you get. Evaluate the board as much or more than they’re evaluating you; learn everything you can about them — “due diligence” is the operative phrase here. Weigh others’ opinions even as you trust your own intuition. As always, think strategically: Is this the right first/next step for me on my leadership path? If the answer is “No,” keep looking; if the answer is “Yes,” dive in and enjoy the process!

Staff/Board Relations

Staff/Board Relations

By Colin Berry

Though luckily not universal, a common point of tension in many organizations is the clarity of roles between the board and its staff or employees. Nurses who currently serve on a board may recognize this tension — or the potential for it.

In general, the board’s role is to select, evaluate, and support the CEO or executive director (ED); approve high-level organizational goals and policies; make major decisions; oversee management and organizational performance; and act as external ambassadors for the cause or company, raising money and strengthening stakeholder or community relations.

By contrast, the staff’s role is to run the organization in line with the board’s direction; keep them educated and informed; seek its counsel; recommend goals and policies; frame decisions in the context of the organization’s mission and strategic vision; provide the board with well-documented recommendations, timely information, and context; communicate with transparency; be responsive to requests for information; and mobilize directors in leveraging their connections in order to support the organization.

The following chart lays out these separate — and occasionally joint — responsibilities:

Activity Board Staff or Employees
PLANNING:
Direct planning process
Provide input to long-range goals
Approve long-range goals
Formulate annual objectives
Approve annual objectives
Prepare performance reports on achievement of goals and objectives
Monitor achievement of goals and objectives

 

PROGRAMMING:
Assess customer/community stakeholder needs
Train volunteer leaders*
Oversee evaluation of products, services, and programs
Maintain program records; prepare program reports
Prepare preliminary budget
Finalize and approve budget
Ensure yearly expenditures stay within budget
Organize fundraising campaigns*
Solicit contributions in fundraising campaigns*
Approve expenditures beyond authorized budget

 

PERSONNEL:
Hire CEO (or ED*)
Make decision to add staff*
Settle disagreements among staff/employees
Hire, fire, and direct work of the staff/employees

 

COMMUNITY RELATIONS:
Represent organization to the community
Write news stories; implement branding

 

BOARD COMMITTEES:
Recruit new board members; appoint committee members
Promote attendance at board or committee meetings
Plan agenda for (and take minutes at) board meetings
Plan and propose committee organization
Prepare proposals/presentations for board and committee meetings
Sign legal documents

*nonprofits only

Two final notes for nurses who serve on nonprofit boards: Occasionally trustees have been known to overstep their roles and interfere with staff decisions or staff-directed operations. Remember that your primary role as a board member, though a volunteer, is policy and governance, not organizational details of procedures; those are under the purview of the staff. The only staff member over whom the board has authority is the ED — who in turn directs the staff.

Finally, in a situation in which a board member is acting as a volunteer performing a program service — taking tickets, serving food — at an event, the trustee is under the direction of the staff supervisor in charge of that activity, not the other way around.

Understanding the differences between these roles and establishing clear lines of authority will help eliminate possible rifts between a nonprofit’s staff and the members of its board.

Do’s and Don’ts

Do’s and Don’ts

By Colin Berry

Being a good board member requires a little knowledge beforehand. As a new director, you’ll be soon learning a lot. In the meantime, following are five “dos” and five “don’ts” to help you get yourself ready for board service.

Be prepared.

Whether for a nonprofit or for a company, board business is an essential part of any organization’s operations. Treat it that way. Commit to meetings by entering them on your calendar; arrive on time, having read (and digested) all materials beforehand. Have your questions ready.

Be professional.

Being a board member requires professional conduct — always. Overall, this means respecting the confidentiality of the boardroom and disclosing any potential conflicts of interest. It means responding quickly to board-related emails. It means not gossiping. During the meeting itself, it means no phone calls, no texting, and no social media.

Participate.

Remember that you’ve been selected to serve on the board because your voice matters. Take an active part. Learn as much as you can about every aspect of board business and make it your goal to speak up several times in each meeting.

Be accountable.

The world is full of people who say they’ll do things they don’t end up doing. As a board member, be known as the opposite: someone who is reliable, dependable, and accountable for the things they say they’ll do. You’ll quickly be noticed — and acknowledged — by your peers.

Be an ambassador.

As a board member, you’re a public representative of the organization you’re serving. Embrace it. Speak up about it in public and, if necessary, to your network of friends and colleagues. If you’re part of a nonprofit, take time to talk to others about the cause; if you’re part of a corporate board, be willing to help boost the business.

1. Don’t be afraid to ask questions.

Remember that your position as a director or trustee reflects a portion of your shareholders or stakeholders. If you need to better understand an issue, chances are good that someone else does, too. Speak up. Get clarity.

2. Don’t lose sight of your own big picture — or the mission of your board.

Why have you chosen to serve on a board? Only you can answer that question. Regularly check in with yourself: Are you getting what you need? Are you bringing what you can? How is your current situation part of your own big-picture plan? And with every decision as a member, make sure you feel it’s aligned with the mission of the board itself.

3. Don’t wait to be reminded.

Promised you’d provide your help on a certain issue? Said you’d make an introduction to a potential donor or investor? Said you’d arrange for a detail at the year-end gala? If you commit to doing something, do it. Don’t wait for someone to remind you.

4. Don’t forget you’re part of a larger system.

Boards are essential, but they’re only one part of a healthy, functioning organization. A nonprofit’s office staff works hard to keep things running and deserves respect from board members as peers. Employees at a company are its lifeblood and deserve recognition from board members as a valuable asset.

5. Don’t neglect the law.

As a new board member, you’ll soon learn about “the duty of care,” “the duty of loyalty,” and “the duty of obedience.” For now, just be aware that as an advisor, trustee, or director, you’re likely to have legal responsibilities related to the finances and the operations of your organization. Learn them. Take them seriously. If you’re not clear about what those duties are, ask.

Types of Boards

Types of Boards

By Colin Berry

Exploring the different kinds of boards where a nurse may participate may feel overwhelming at first. There are several types, and the purpose of each — as well as members’ roles, responsibilities, and even their naming conventions — isn’t always consistent. What follows is an overview of the various kinds of boards.

First, though, let’s start with a pair of basics: A board is a body whose members are elected or appointed to oversee the activities of a nonprofit, corporate, or government entity. Boards of directors are required for corporations and nonprofits; other kinds of boards are formed in response to the need to shape or direct an organization as it grows and changes.

Second, let’s define governance. Governance is the establishment of policies and monitoring of their proper implementation by a board. These include the mechanisms required to balance the powers of the members and their primary duty to enhance the prosperity and viability of the organization.

In most cases, a board’s actions are governed by some outside authority — most often bylaws created by the organization itself — that controls its powers, duties, and responsibilities. Bylaws typically govern how many members can serve on the board, how they’re chosen, how often they meet, and other details.

For a nurse considering a directorship, boards fall into five different types:

1. Professional Nursing Organizations

The nursing association to which a nurse belongs is likely to have local, state, regional, and national chapters, any one of which offer excellent opportunities for board service. Nurses considering board service who are not already members of their local chapter should consider joining, which affords the opportunity to volunteer for a committee assignment and — once the RN is more familiar with the organization and its mission — consider moving into a board position at the local level.

2. Advisory Boards

As its name implies, an advisory board provides advice — input and mentorship to the management of a corporation, organization, or foundation. Its members are “advisors,” not “directors”; the body itself may be called a “council.” While its informal nature gives this kind of board greater flexibility in structure and management than a traditional board of directors, it also lacks the authority to vote on corporate matters or bear legal fiduciary responsibilities. Think of an advisory board as a think-tank: Many new or small businesses create one in order to benefit from its advisors’ collective knowledge without the expense or formality of a traditional board of directors.

Start-ups, nonprofits, or organizations testing or seeking feedback on new initiatives often choose to create advisory boards, whose members are unpaid. Bringing direct experience with the public and an inherent ability to think creatively, an RN can provide a valuable perspective to an advisory board.

3. Nonprofit Boards

More complex, a nonprofit board serves a charitable organization — a 501(c)(3), approved as tax-exempt by the IRS — that is not (and cannot be) organized or operated for the benefit of private interests. Nonprofits can be member-serving, such as a trade union or industry associations, or community-serving, which focus on providing services to the local or global community. A “nonprofit” designation doesn’t mean the organization doesn’t intend to make a profit; rather, it means it has no owners, and that any money it makes will not be used to benefit them.

Nurses who serve on nonprofit boards are essentially making a commitment to a cause. Most are unpaid volunteers, and will often will be asked to make a financial donation in addition to serving on the board; practices vary with each nonprofit. A nurse’s seat on a nonprofit board should reflect his or her alignment with the cause, and they should be prepared to spend a portion of their time taking part in fundraising activities.

There are currently more than 22,000 nonprofits in Oregon, including a host of health-related causes. Nurses seeking to join a nonprofit board are likely to find many that qualify; RNs with particular interest in an aspect of health care need only do a little research. The Secretary of State’s website, sos.oregon.gov, is an excellent source for Oregon nonprofit data.

In general, service on a nonprofit or advisory board can be a powerful starting place for a nurse’s path to a private or corporate board directorship. Nurses with even a small amount of board service experience can excel on a nonprofit board, although personal alignment with the cause itself is crucial. In her book, Nurse on Board: Planning Your Path to the Boardroom, author Connie Curran explains: “The pathway to a corporate board role for nurses will likely progress from a nonprofit or advisory board to a startup and then to a corporate role. There are important lessons to be learned and experiences to be gained along the way.” Even as gaining experience on an advisory board can be a natural progression to joining a nonprofit board, there is no prescribed order or hierarchy as long as the nurse is closely aligned with the organization’s mission and vision.

4. Private Boards

While most boards are set up as public, some are created to be private. These include corporations and nonprofits of all sizes, from start-ups to family businesses to large, established organizations. For a privately held for-profit company, a board’s main function is to help grow the company.

Though they may lack a business background, nurses are perfectly qualified to be directors on private boards. A start-up company that’s come up with a new healthcare technology or health-related app, for example, would be well served to have an RN on its board. Besides experience, nurses bring a human perspective — from service to a diverse audience, clinical expertise, and organizational, and leadership expertise to such highly specialized companies. A director’s seat on a start-up board can be exciting…and occasionally intense.

No matter the size of the company, becoming a corporate board member is a powerful introduction to board service and should be undertaken with an understanding of the work it requires. While private corporate board members are often paid for their service, sometimes in stock options or shares of the company, board service may call for many hours of time and commitment.

5. Corporate Boards

To start with, let’s clear up a common misperception: that because a nurse hasn’t acted as a CEO or CFO, he or she lacks the necessary experience to serve on a for-profit board. That’s not true. The truth is that many, many nurses bring a unique and valuable perspective and can provide key benefits to a corporate board.

As Connie Curran states in Nurse on Board:

Nurses can position their backgrounds and experiences in other ways:

Many nurse executives manage budgets that may be equivalent of the budget of a small corporation. It is not unusual for a nurse manager to have responsibility for dozens of employees.

The financial and human resource skills needed to manage units, hospitals, and clinics are appropriate skills for board positions. Nurses who serve as deans and association executives have the financial, human resource, and customer service experience necessary for corporate boards.

Nurses have deep knowledge about something that is critically important to a business. Pediatric nurses, for example, know about baby formula and diapers. They have interacted with hundreds or even thousands of parents, and they have been privy to their perspectives. Diaper or formula companies could receive significant benefit from those insights.

A director’s position on a corporate board isn’t something to be taken lightly. But experienced RNs need never disqualify themselves from considering the job because of their own supposed lack of experience. Nurses often undersell themselves.

Serving on a corporate board typically requires a significant commitment of time. Nurse or not, a director must spend hours preparing for meetings, attending them, and preparing for and attending the many committee meetings that occur between regularly scheduled board meetings. Events, galas, dinners — a director has frequent opportunities to spend more time in support of the company.

Part of the benefit of this, of course, is that most companies compensate board members for their service; but directors are also expected to meet unexpectedly should a crisis arise, open their network to the company, and maintain full participation at all times. In addition, they have fiduciary responsibilities to the company’s shareholders, which carries the risk of liability, especially in organizations that don’t prioritize oversight. But the truth is that the right corporate board is a great place for a nursing professional to make a powerful impact with an organization, its leadership, and the customers and community it serves.

Whatever its purpose, nearly any board can be improved with the addition of a nurse to its membership.

Top 10 Practices of Great Boards

Top 10 Practices of Great Boards

By Barry S. Bader

1.

Be sure every member fully understands his or her accountability, responsibilities and the expectations of the office, and document it all in a written position description.

2.

Choose members based on written criteria that define the professional backgrounds, skills, personal qualifications and diversity needed on the board – and reelect members based on continued strong performance.

3.

Make the board a learning organization, integrating education and real-time learning into everything the board does, from fully engaging in strategic planning to policymaking, oversight and stakeholder relations.

4.

Build a strong working partnership with the CEO, but never forget the board’s independent accountability to oversee executive performance.

5.

Fully utilize strong working committees to perform detailed oversight and bring well-documented recommendations to the board.

6.

Develop and use a dashboard or balanced scorecard of key performance indicators for finances, operations, business strategy, clinical quality, customer service and community benefit.

7.

Ask why: Fully understand the information provided to the board, get to the root causes of variances and apply innovative thinking to board work.

8.

Pay attention to building a healthy board culture — to how the board works as a team, asks questions, and takes action — as well as to its more tangible board structures and processes.

9.

Develop a Board Policy Manual, including policies on how the board will perform important governance functions, such as strategic planning, budgeting, quality review, CEO evaluation, audit, executive compensation review, board recruitment, succession planning and board self-evaluation, among others.

10.

Make self-evaluation an integral part of ongoing board development; assess the performance of the full board and the chairperson, and when the board has established a strong culture of trust and confidence in itself, carefully begin a process of assessment and improvement of individual performance.

About the Author

Barry S. Bader, publisher of Great Boards, is the president of Bader & Associates, a Maryland-based governance consulting firm. www.GreatBoards.org

Red Rules for Boards

Red Rules for Boards

By Barry S. Bader

In industries where safety is critical and quality must come first, such as airlines and nuclear power, “red rules” refer to protocols that must be followed “to the letter” – all work stops until they are. A commercial airliner doesn't leave the gate if the pilot spies a possible leak or flat tire; a nuclear plant operator or even a Toyota assembly line worker can “stop the line” when he spots a critical flaw.

The Agency for Healthcare Research and Quality (AHRQ) says one example of a red rule in healthcare might be: “No hospitalized patients can undergo a test of any kind, receive a medication or blood product, or undergo a procedure if they are not wearing an identification bracelet.” The moment a patient is spotted who does not meet this condition, all activity ceases until the patient's identity has been verified and an identification band is in place.

What differentiates red rules from many “standard rules,” says AHRQ, is that red rules are “always supported by the entire organization. When someone at the frontline calls for work to cease on the basis of a red rule, top management must always support this decision,” notwithstanding any inconvenience, time lost or financial costs.

The concept of red rules can also be applied to governance. There are some practices that are so intrinsic to the effective functioning of a board that they always must be followed and enforced by the board's leadership and the CEO. Here are seven such practices — or “red rules of governance” — for your board to consider:

1. Values first

Never compromise (or lose sight of) the mission and values of the organization, no matter what. If you can't reconcile a strategy, decision, initiative, or policy with the fundamental mission and values of the organization, stop action and question why you're doing it. Recommendations to expand or close a service line or community clinic, reduce staffing, redesign benefit packages, or hire physicians to cover the emergency department have major financial implications and may be the right course of action – but only after a thoughtful and disciplined exercise to consider mission and values, weigh options, and make the best choice.

2. Speak up

Never be passive on a matter of importance. “I'm not convinced the project management is proposing makes strategic or financial sense, but the CEO seems to really want it, so I didn't question it.” How many times have you heard board members express such comments?

Boards have to put significant trust in management and their board leaders, encourage risk taking, and recognize failures will occur. Good boards do not endlessly nit-pick every management recommendation or shortfall.

But on major decisions and policy matters, if a board member has serious concerns, passivity paves the road to ill-founded decisions. Red rule: speak up. In a famous example of governance abrogation of responsibility, when the CEOs of Time Warner and America Online surprised their directors with a proposed merger, only two board members voiced concern. Later, Ted Turner at Time Warner and Alexander Haig at AOL regretted that they acquiesced so readily; they didn't try to rally the board to stop the train and allow a full board examination of a “bet the farm” deal that would fail miserably.

The lesson: Directors should never be cowed into silence on a major issue until all legitimate questions have been raised and answered with good data and sound arguments.

3. Minimize disruptive members

Never tolerate a disruptive board member. “Disruptive” refers to any behavior that interferes with the orderly and appropriate work of the board. Disruptive board members include those who show disrespect toward their colleagues or management, interfere with management, deliberately violate confidentiality, regularly arrive late or leave early, constantly interrupt or harangue at meetings, fail to meet minimum attendance requirements, or come to meetings unprepared.

Conversely, disruption is not candid comment, voting with a minority, or raising strong questions of management – those are necessary and appropriate behaviors. Every board can benefit from a contrarian or two, and all directors should on occasion constructively challenge the prevailing wisdom, but effective directors can disagree without being disagreeable.

Too many boards tolerate disruptive behavior that drags down the entire board's performance. The director's position description or a code of conduct should articulate a high standard of performance. When disruptive behavior occurs, the board chair should take action appropriate to the situation. In some cases, a quiet word after the meeting will do, but in other cases a more formal “visit to the woodshed” may be in order. The Executive or Governance Committee may be called to consider the matter. If the behavior continues, the board should not hesitate to remove the disruptive member.

4. Define conflicts of interest

Never ignore violations of the conflict of interest policy. Conflicts of interest involving directors put management in an uncomfortable, even untenable position. They open the board to criticism from the press and government overseers. The board should have a clear definition of what constitutes a conflict and require full disclosure annually and whenever a conflict arises. A committee of independent directors should review all conflicts, determine whether they are acceptable, prescribe action to protect the organization (e.g., competitive bidding process), and submit a report summarizing all conflicts to all board members.

The conflict of interest policy should include a section describing a clear process for any board member to follow if, in the middle of a meeting, they think someone may be conflicted. It takes a bit of the sting away for a director to “invoke paragraph 9b” rather than explicitly discussing a colleague's possible conflicts. The process could include a “stop action” that is called by the chair and an immediate break for the independent directors to
confer on the situation.

Even when the board determines a member with a conflict may serve on the board (and many great board members do have appropriately disclosed conflicts), the conflict of interest policy should clearly prohibit directors from using their position or information gleaned as a director for personal gain.

If a board member violates this proscription or inadvertently fails to disclose a conflict, an immediate warning is called for. Repeated or deliberate violations can have only one resolution: removal from the board.

The board should adopt clear rules on sticky situations – such as whether physicians who invest in competitive ventures have a disabling conflict that should bar their continued board membership. Once the rule is set, follow it. Tolerance is worse than having no rule at all.

“The concept of red rules can also be applied to governance. There are some that are so intrinsic to the effective functioning of a board that they always must be followed and enforced by the board’s leadership and the CEO.”

5. Notify the CEO in advance

Never surprise the CEO. If a director plans to air serious reservations about an upcoming matter or the performance of a program, common courtesy and good board process say to give the CEO a heads-up. Advance notice allows the CEO to come prepared with facts and data and to give thought to the appropriate response. CEOs are not omniscient – they cannot be expected to know every detail of a complex enterprise. Surprising a CEO triggers understandable defensiveness. Even if the board raises good questions, a CEO who feels ambushed can lose objectivity and may be unwilling to reconsider a matter for fear of looking weak.

The intent of a “no surprises” rule isn't to bar spontaneous questions but to respect management and allow good preparation. If a director deliberately or repeatedly violates the red rule against surprises, the Board Chair should speak with the member and – if the behavior continues – stop the sneak attacks when they occur.

6. Notify the board in advance

Never surprise the board. Similarly, when CEOs bring significant decisions to the board at the eleventh hour, without advance information or thorough committee review, members naturally resent being treated as a rubber stamp. True emergencies requiring expedited board process will occur, but they should be rare.

If a CEO or senior executives fall into a pattern of asking for approval of done deals, the board should apply the red rule and say “No, we'll consider the matter though the appropriate committee and vote next time.” Once should be enough to send the signal that diligent governance oversight requires sufficient notice.

7. Stay within the defined board constraints

Never bring operational questions or data to the board. CEOs and senior executives who complain that their boards get into operational details should examine their own practices first to ensure they are providing the right level of information to directors. Is the strategic plan really a management implementation plan that doesn't focus the board on a few critical strategic success factors? Does the CFO bury critical financial indicators in voluminous financial statements instead of highlighting them on a dashboard? Is the board looking at every JCAHO core measure instead of rolled-up or bundled measures, such as the percentage of heart attack patients who received “all appropriate care?”

If operational reports are going to the board or a committee, stop the assembly line and ensure that the board gets governance information, not management detail.

For their part, boards should articulate what they want to know, and they should ask for information that's strategic, trended, contextual, and compared to best practice. If the board doesn't get a comprehensive performance dashboard or balanced scorecard, invoke the red rule and ask management to work with the board to create one.

If a CEO thinks his board is wandering into operational territory, he should tactfully raise the issue and try to reframe the matter in larger policy or strategy terms. Complaining to subordinates after the fact doesn't fix the problem. If some board members regularly “get lost in the weeds,” education or discussion of board roles at a retreat may be the remedy.

Summary

Following red rules for boards won't produce results as dramatic as no nuclear mishaps or airline accidents. They will, however, help a board and CEO work as a team, approach tough decisions with candor, and sleep soundly because they've protected the mission and provided the organization with sustainability for the long term. What are your board's red rules?

About the Author

Barry S. Bader, publisher of Great Boards, is the president of Bader & Associates, a Maryland-based governance consulting firm.   REPRINTED FROM GREAT BOARDS, Summer 2007 Published by Bader & Associates Governance Consultants, Potomac, MD

Distinguishing Governance from Management

Distinguishing Governance from Management

By Barry S. Bader

“What is the difference between governance and management?” is by far the question that not-for-profit executives and directors ask most often. Effective boards understand the difference between governing and managing; dysfunctional boards do not.

The traditional, easy answer—that the board makes policy and management carries it out—is too simplistic. It offers little practical guidance at a time when fiduciary expectations are rising. Nowadays directors serve on boards to make a difference, not just to be names on the letterhead and donors on a wall. Today's boards must be informed and want to be engaged, both to fulfill their legal obligations and to leverage their time and talent to advise management. But — at what point does appropriate engagement cross the line into running the show?

It is tempting for directors to believe they are doing their jobs by delving into management decisions. The temptation is particularly strong for some, such as physicians who practice at the hospital and think they know how things should be done. It's tempting for outside directors who may bring ideas based on what works in their businesses or what they've heard from friends who are physicians or nurses.

Seven Guiding Questions

  • Is it big?
  • Is it about the future?
  • Is it core to the mission?
  • Is a high-level policy decision needed to resolve a situation?
  • Is a red flag flying?
  • Is a watchdog watching?
  • Does the CEO want and need the boardʼs support?

Wise directors avoid the temptation to co-manage or second guess. Directors' fresh thinking and applied business knowledge are desirable, but health systems and hospitals are complex organizations with multiple moving parts. Tinkering in one area will affect many others. Complex organizations require strong, knowledgeable executive leadership to get everyone pulling in the same direction. They require tough choices about people and about what can and cannot be funded. Boards that try to manage often end up generating unintended consequences. They undermine the CEO's credibility and authority, to the detriment of the organization as a whole. They also risk driving away competent executives and directors who don't agree with a hands-on approach to governing.

Health systems and hospitals are complex organizations with multiple moving parts; tinkering in one area will affect many others.

Governance Roles and Responsibilities

An understanding of the difference between governance and management rests on the cornerstone of fiduciary responsibility. Just as corporate boards are accountable to shareholders, the governing body of a not-for-profit organization has a fiduciary responsibility to see that the organization is acting in the best interests of the public, and more specifically the “stakeholders” who are served by the organization's mission. For the not-for-profit hospital, the highest-order stakeholders are the patients and the community. Today's boards carry out five primary roles as independent fiduciaries (see Figure 1): choosing the CEO, approving major policies, making major decisions, overseeing performance, and serving as external advocates. Hospital and health system boards focus their attention on the organization's mission and strategic direction, finances and investments, quality, community benefit, and corporate compliance with laws and regulations. The role of management, led by the CEO, is to operate the organization in line with the board's direction. Management makes operational decisions and policies, keeps the board educated and informed, and brings to the board well-documented recommendations and information to support its policy-making, decision making and oversight responsibilities.

Figure 1: The Board-Management Relationship

Seven Guiding Questions

Even when the mutual roles of the board and management are understood, there isn't always a bright line distinguishing governance from management. Different situations will affect the appropriate level of governance involvement. Adverse results may call for closer board oversight. For example, if the organization is in a financial downturn, is not improving subpar quality scores, faces allegations of improprieties, or is considering a merger or major transaction, the board may become more engaged and review more detailed information than it normally would. Otherwise, a governing board functions best when it focuses on higher level, future-oriented matters of strategy and policy and performs its oversight responsibilities in a rigorous but highly efficient manner. Seven questions can help a board and management to agree on their appropriate roles for any matter of board oversight or decision making:

1. Is it big?

Is it big? The bigger the impact of a decision, the more the board ought to play a role in shaping and understanding the action and its possible consequences. One rule of thumb is that organizational decisions impacting roughly 10 percent or more of an organization's revenues or activities are strategic decisions. A decision on whether to start or greatly expand major clinical service lines such as cardiology, oncology, and orthopedics would be a strategic matter. Planning how to implement the expansion is management's responsibility. The corollary to “Is it big?” is “Is it too small to merit the board's attention?”

2. Is it about the future?

Is it about the future? Boards make their impact on what the organization will look like five or more years down the road. The board's fingerprints should be on the organization's long-term vision and an integrated, three-to-five-year strategic and financial plan, as well as a master facility plan. Tomorrow's campus is the work product of today's board and management. Boards should rely on management to develop draft strategy documents for board input and approval. A board-approved strategic plan should have several major focus areas, such as quality, growth, finances, and people, with measurable goals for key indicators and initiatives in each area. Another rule of thumb: if the board-approved strategic plan has more than five or six strategic areas and more than about 20 strategic initiatives under those areas, the plan is probably management's operating plan and the board is getting involved at too low a level.

3. Is it core to the mission?

Is it core to the mission? As a fiduciary, the board is the guardian of the mission. Questions such as whether to continue a financially underperforming facility, how much to invest in community benefit activities and whether to open clinics in medically underserved communities call for the board to examine strategic and financial decisions in a mission context. Management should bring the board well-documented analyses and recommendations to help directors strike the right balance when mission and financial realities come in conflict.

4. Is a high-level policy decision needed to resolve a situation?

Is a high-level policy decision needed to resolve a situation? A policy sets forth principles, guidelines, or practices to be applied in certain situations. For example, should a physician member of the board who invests in a competing facility be permitted to continue in office and practice on the medical staff? Should a manager be permitted to dismiss an employee who he says is underperforming, but who has filed a complaint alleging the hospital is violating Medicare payment rules? These situations call for consistent decision-making based on policies on physician competition and whistleblowers, respectively. Other common hospital board policies address such matters asconflict of interest, charity care and community benefit, executive compensation, CEO evaluation, and public transparency. A board's policies should be compiled into a policy manual that is available for reference at any board or committee meeting and distributed to every trustee. Of course, organizations have hundreds of operational policies governing various aspects of personnel, finance and billing, and patient care. These are not board matters. Policies requiring board approval should have a major impact on the organization, require compliance with laws or regulations, or affect the responsibilities and conduct of the board, management, and subsidiary boards.

5. Is a red flag flying?

Is a red flag flying? Boards should routinely review dashboards and other performance reports, but when should they get into more detail discussing results and raising questions? Directors should know the red flags that signal the need for closer inquiry. Boards and especially oversight committees should focus on trends. One rule of thumb states that statistically significant over- or underperformance on a strategic, quality, or financial indicator over at least three reporting periods constitutes a trend. Of course, sentinel events, reports of unethical or illegal activity, or dramatic underperformance require prompt board or committee review before a trend develops. Red flags may also appear in reports from the external auditor, general counsel, accreditation agencies, and others. To avoid slipping from governance into management when reviewing performance problems, the board should focus on whether management recognizes the problem and has established the capability and plans needed to improve results. The board should not micromanage possible solutions; it should hold management accountable for producing better results.

A governing board functions best when it focuses on higher
level, future-oriented matters of strategy and policy and
performs its oversight responsibilities in a rigorous
but highly efficient manner.

Organizational decisions impacting roughly 10 percent or more of an
organization's revenues or activities are strategic decisions.

If the board-approved strategic plan has more than five or six strategic areas
and more than about 20 strategic initiatives under those areas, the board is
involved at too low a level.

Management should bring the board well-documented analyses and
recommendations to help directors strike the right balance when mission and
financial realities come in conflict.

Directors should know the red flags that signal the need for closer inquiry. One
rule of thumb states that statistically significant over- or underperformance on
a strategic, quality, or financial indicator over at least three reporting periods
constitutes a trend.

The board should not micromanage possible solutions; it should hold
management accountable for producing better results.

If Congress, IRS, the state attorney general or the news media cares, the board
should care.

When the CEO calls, good boards respond.

6. Is a watchdog watching?

Is a watchdog watching? If Congress, IRS, the state attorney general, or the news media care, the board should care. Hot button issues of the moment include community benefit, charity care, executive compensation, medical errors, and publicly available quality results. Boards should be proactive on high-profile issues, adopting appropriate policies, overseeing performance, and ensuring the organization has a proactive public communications strategy.

7. Does the CEO want and need the board's support?

Does the CEO want and need the board's support? If the CEO asks for board advice or intervention, directors should respond. When CEOs are about to embark on careerlimiting activities, such as fighting a labor union or terminating the contract of a noncooperative but popular physician group, the executive must know the board will stand firm. Sometimes CEOs want the board to challenge management to raise the bar for performance, which gives the CEO the board's backing to ask more from senior leadership and the medical staff. CEOs may also ask for help from directors with connections with donors, legislators, and community stakeholders. When the CEO calls, good boards respond.

Some practices and structures can help a board stay out of operations and focus on governance. The chairperson should exercise leadership and not hesitate to keep discussions focused on a higher plane. A CEO's letter to the board between meetings updates the board on recent events and obviates the need to discuss operations at meetings. A consent agenda enables a board to handle routine matters without discussion and frees up time for more important matters of policy and strategy, as well as board education. Committees for finance and investments, quality, audit and corporate compliance, and executive compensation have clear governance purposes. Conversely, in many cases, board committees on marketing, personnel/human resources, and facilities engage board members in management work and usually aren't needed.

Most importantly, the board should elect members who understand and respect the difference between governance and management. Choose wisely, seeking as directors individuals who bring no personal agendas, understand the role of management in large, complex organizations, and have a desire to work as part of the board-management team. Then conflicts between the board and management will be rare.

About the Author

Barry S. Bader, publisher of Great Boards, is the president of Bader & Associates, a Maryland-based governance consulting firm.   REPRINTED FROM GREAT BOARDS, Fall 2008 Published by Bader & Associates Governance Consultants, Potomac, MD