August 23, 2023

Splitting the Atom? The Nature of Strategy and Governance

Some things just seem to go together naturally. Peanut butter and jelly; chips and guacamole; Taylor Swift and breakup songs. When two things are complementary by nature, pulling them apart feels like an affront to the way things are supposed to be. Such is the case with nonprofit strategy and board governance.

While peanut butter can exist without its fruity companion and chips are just fine without smashed avocados on top, strategy and governance share DNA that makes it difficult to address one without encountering the other. It really doesn’t matter which one is the point of entry.

On one hand, there are universal governance principles that can stand alone. Open communication, clear roles and boundaries, and mutual accountability are a few that I emphasize in my work. At a more practical level, the ten major responsibilities of nonprofit boards, from BoardSource, is a guiding document for board development.

The same goes for strategy. On its own, strategy operates within a framework that serves as an advanced organizer for the planning process. Granted, some are more useful than others. But the right framework under the right circumstances is a recipe for success.

But here is the rub. Even though each can be addressed separately, strategy development and board governance cannot be implemented outside of the context of the other. From a practical standpoint, this means that strategy development can be futile without the proper governance structure to support it. Consider the following examples:

  • Your strategy includes lessening dependence on government contracts, yet the board insists that it is not set up to be a “fundraising board”.
  • Strategy oversight is assigned to a program committee, whose members were recruited for their content expertise, not their business acumen.

From a governance point of view, strategy is the context for board development. Does your organization need a marketing committee? It depends. Where is the organization trying to go? How will marketing help the organization make progress toward these priorities? How much help does it need from the board?

To summarize, strategy is a core governance function. Relatedly, a board is most effective when its work is aligned with the organizational strategy. Addressing either outside of the context of the other is well, unnatural.

Need Additional Assistance?

If you are interested in going deeper into your nonprofit strategy or if you wish to review your organizational strategy more broadly, click the link below to schedule a 30-minute phone or zoom consultation with Mike Stone.

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