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Waking Up the Board – Warning Signs of a Dysfunctional Organization

By Lilya Wagner on December 23, 2009No Comment

Last month we followed the saga of the ISRE organization and the case of the board which was asleep on the watch. Over the period of time that it took for ISRE to fade away and end up missing in action, the board should have taken note of warning signs, some which were evident right from the beginning.

True, Bill Jones, the president, should have been a better administrator and kept his board better informed, but ultimately the board holds the responsibility for the organization, and they should have noticed what was happening.

So, here is a checklist that board members might refer to as a reminder of symptoms which indicate some degree of hidden organizational dysfunction:

1. There is no strategic plan and therefore no clearly defined means by which a board can monitor and evaluate results and progress.  Proposals and reports are not sufficient to keep an organization on track.  In addition, plans generated by staff members for their areas of responsibility are rubber-stamped by board members, with little meaningful input.

2. The organization loses funding from a major source, and is unable to secure replacement funds.  A firm funding base has not been established.  Furthermore, there isn’t 100% participation by board members in giving to the organization, and they are reluctant to become involved in fund raising.

3. Stated goals are not being met and not much is accomplished on projects.  Reports are too optimistic, with not enough data to support them.  Also, reports indicate the same results time after time.

4. Staff no longer requests that board committees meet with them.  There is less communication between members of a board committee and the staff member(s) assigned to it.

5. Change is accepted reluctantly.  Risks are not taken.

6. Staff members feel they can’t speak out in meetings and therefore congregate in small groups afterwards.  They do not understand how and why some decisions are made.  They begin to complain and there is conflict and hostility among them.

7. There are apparent favorites among the personnel.  Consequently there is distrust and hostility among staff.  Complaints become more frequent, and people jump to unwarranted conclusions very quickly.  Staff becomes defensive and productivity goes down.

8. Decisions are made only by the CEO, or in consultation with a few staff members.  Other staff members don’t know about those decisions and feel left out, besides being unknowledgeable and therefore unable to answer board, constituent or media questions.

9. Budget problems become more frequent, and explanations more vague.  The organization begins to fall behind in its financial obligations.

10. Key board and staff members depart at an alarming rate.

11. Constituents begin to ask discreet questions, or issue complaints in public about rude staff, unanswered mail requests, phone calls that are not returned and unfulfilled promises.

Nonprofit organizations are established because they carry out the vision and mission of people with worthy causes.  If board members are committed enough to a cause to give it time and money, they undoubtedly want to be accountable for a healthy not-for- profit organization.

A governing board must rely on the CEO and staff for its information, but a vigilant board geared for success is also alert to the danger signals, either overt or hidden, that hint of a dysfunctional organization, one which may eventually cease to exist.  So, board members, beware!

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