| Benefit |
Old-style boards |
Policy Governance® |
| CEO and staff are empowered to do their jobs with confidence and creativity. |
No. CEO/staff make plans and decisions which they must present to the board for approval. Staff might receive some direction but often it is unclear, incomplete or contradictory. Confusion frequently results when staff cannot distinguish between advice or suggestions vs. direction. |
Yes. The board creates clear and complete criteria for successful decisions, plans and actions. CEO/staff have the freedom to apply these criteria within the boundaries of ‘any reasonable interpretation.’ |
| The board saves time discussing operational details or minutiae. |
No. Without a clear way of distinguishing between board and management responsibilities, micromanagement prevention usually depends on the fortitude of the board chair to establish and stick to board-driven agendas. |
Yes. Board and CEO are clear on who does what, and avoid the temptation to wade into each other’s area of responsibility. Board meetings are about board (not staff) decisions and priorities. |
| Owners/shareholders see that the organization/company is achieving what it should and avoiding what is unacceptable. |
Doubtful. The many recent corporate disasters and organizational fiascos are testimony to the huge gap between what shareholders, owners or citizens want and what actually happens. |
Yes. Policy Governance centers on the importance of ownership linkage, and creates a systematic approach that aligns ownership wishes with operational outputs. |
| Board members apply their skills and wisdom in a way that makes a difference. |
If they’re lucky! Board members typically review decisions already made by staff, and then either second-guess or rubber-stamp those decisions. |
Yes. Not only do directors truly set the ‘tone at the top,’ they also direct and protect the organization with the greatest possible clarity and efficiency. |
| The board has the ability to control risk ‘enterprise-wide’ without stifling freedom or innovation. |
No. Standard methods of controlling risk seem to require more approvals, paperwork and a greater overlap between board and management functions. Tighter and often costly internal controls usually come at the expense of the ability to staff to innovate, to change and to take action quickly. |
Yes. The same system that controls risk throughout the organization also maximizes freedom for staff to get the job done. Additionally, the risk that the organization might not achieve what it should is a key piece of the system. |
| ‘Politics’ is kept to a minimum. |
No. The many overlapping functions of board and CEO/staff, with competing views of how things should be done, typically fosters tension. In some cases this tension spirals into misunderstandings, intense politicking, frustration, loss of motivation, diminished results, and overall disharmony. It is never long before the absence of clarity is replaced with the presence of dysfunction. |
Yes. Because this method creates a high level of clarity, empowerment, and accountability, there is very little room or necessity for tension, politics, and disharmony. |
