1.5 - About University

3. Clarify limitations on the CEO’s and the management team’s activities.Things to clarify:• Having clearly prescribed the results expected (the ends), next clarify only the boundaries or limits on the CEO andmanagement team practices, activities, and methods. [☛ 2.7 Goal Statements]• Identify specific areas of Board concern. State exactly what is not prudent and ethical.• Consider where expert input might be needed, such as technical matters (e.g., legal or finance).Potential pitfalls:• Boards can choose to be understanding of performance shortfalls, but should never bend an inch on integrity.[☛ 1.11 Integrity]4. Clarify Board processes.Things to clarify:• How the Board represents its shareholders, membership, or ownership.• How the Board works together and leads strategically. [☛ 3.1 Strategy]• Members need to speak with one voice (supporting decisions only when you win the vote is not supporting theprocess).• To determine whether an issue is a Board or CEO issue, ask: “How is the issue at hand related to current policy?”“Does the policy suffice to deal with the concern?” If not, make new policy.• Evaluation of results is the only way to evaluate CEO performance.Potential pitfalls:• Denying, ignoring, or smoothing over differences, or allowing personality to dominate in confrontation. [☛ 12.7Dealing with Conflict]• Dealing with dysfunctional behavior is more difficult if the Board has not previously determined what constitutesdysfunctional behavior. (Thus, it is important to create a set of ground rules for the Board.) [☛ 10.8 Ground Rules]H OW TO USE THIS LEADERSHIP TOOL“When the Board addresses the right things it finds it doesn’t have to address many things.”—John Carver, BOARDS THAT MAKE A DIFFERENCEThis tool represents a considerable challenge for a CEO and his or her Board of Directors. Thereis no divine point at which to set the boundary between Board and CEO responsibility. Bynecessity, Board policy making is fluid and stops at whatever point the Board is willing to havethe CEO make interpretations and decisions. Thus, unless the Board wishes to do the CEO’s job(which is always a mistake), Board policies will always leave room for CEO interpretation.(Note that Board policies will not substitute for a lack of trust between the Board and the CEO.)In addition, Board policies need to be explicit, current, in simple language, encompassing, brief(a page or less), accessible, and distinct from operating policies.When developed and practiced with a reasonable level of discipline, the policy governanceapproach works like magic. However, it does take considerable effort to develop and maintaina full set of Board policies in all four areas. Because of the effort required, Boards need to becommitted to this approach at the outset.When embarking on a major task such as this, it’s good to remind yourself how one eatsan elephant—one bite at a time. This work will take from several months to a year or longer.If need be, you can complete a good first draft of these policies in one or two workshops, withthe help of someone trained in the use of Carver’s policy governance model. Don’t be intimidated.The work is well worth the effort. Start fresh. Don’t use old policies. And don’t choosepolicies from a catalog! However, you might consider comparing the policies that you and your130 SECTION 4 TOOLS FOR DESIGNING PRODUCTIVE PROCESSES AND ORGANIZATIONS