Tip #57 Two Mistakes Boards Make in Times of Crisis
Two mistakes that boards commonly make in times of crisis are 1) becoming overly involved in managing the details of their organization’s response to a crisis, and 2) failing to engage in the defining and redefining of organizational purpose in light of the crisis.
- Becoming overly involved in managing the details of their organization’s response to a crisis.
Even boards that generally avoid micromanaging operational details may be tempted to rush in to manage the details of an organization’s response to a crisis. However, such a temptation should be resisted because a board’s over-involvement in operations creates at least two major problems. First of all, such over-involvement compromises the ability of the CEO to develop an effective timely crisis response plan and to be able to modify it quickly as needed for an effective response. Secondly, such micromanagement diverts the board’s attention away from its critical responsibility to define and redefine organizational purpose.
- Failing to engage in the defining and redefining of organizational purpose.
A central responsibility of boards is to define and continue to redefine the purpose of their organizations, that is, what benefits, results, outcomes their organizations are to provide for what persons. In the midst of a crisis, boards can review their organizational purpose as described above (or in Policy Governance® terminology their Ends). They can decide whether or not their organization’s purpose (what good to be provided for what persons) ought to be modified in the short-term in response to needs generated by the crisis situation. In addition, they can explore possible longer-term ramifications or possibilities related to or unveiled by the current crisis, possible opportunities for greater, additional or alternative contributions their organizations might make to addressing human needs in our evolving biological, ecological and social environment.
Policy Governance® provides an effective design for board operations that enables boards to oversee and control operations without micromanaging operational details and that focuses boards on their essential responsibility to define and redefine organizational purpose. For information about the Policy Governance® model, please click https://www.BoardsOnCourse.com/policy-governance.