Saturday, February 7, 2009
Thursday, February 5, 2009
EXECUTIVE PERFORMANCE EVALUATION
In the course of my twenty seven years of consulting with nonprofit boards of directors throughout the U.S. and Canada. I wrote a monthly series of articles (175 in all) called "BOARD SENSE – Common Sense For Nonprofit Board Members" which I distributed to national associations who, in turn, re-distributed them to their local nonprofit member organizations. I was therefore surprised when quite a large number of these board members would tell me at workshops or conferences that what I was writing for my nonprofit clients applied in large measure to the businesses, large and small, which these board members owned or worked for. In the last four years before I retired I switched distribution of BOARD SENSE to the Internet and when I finally stopped, I had over eight hundred subscribers world wide.
Thinking that many of you who read my blogs might find this information useful in whatever type of board you might be involved with I decided to make a number of them available here. For those of you who have little or no interest in this subject, fear not, as I will not allow this one topic to dominate the subjects I will be writing about – except for the first three or four until I feel I have an audience for this type of material. Here now is the fourth of the first set of six blogs in this series.
BOARDS MUST EVALUATE EXECUTIVE RFORMANCE
This is essential for the protection of the CEO and his/her board. I had been working with a client guiding them through their strategic planning process. The board retreat had been held. Purpose, mission, mission related goals and critical issues had all been decided upon and these results expectations of the board had been turned over to the CEO and through the CEO to the staff to develop the implementation methodology in order to complete the plan.
One of the goals set by this organization was a structural reorganization of the staff. Three senior staff members, led by a relatively new senior staff member, were opposed to any change and they set in motion a good deal of grumbling amongst other staff. They also brought complaints about the CEO's management of the organization to the attention of a few individual board members who, without knowing the full story, openly sympathized with the complaining staff members. It is a fair assumption - although difficult to prove - that the leader of this palace revolt was after the CEO's job.
The board was perplexed and bewildered and their difficulties were made the worse because they had not been in the habit of evaluating their CEO's performance. Indeed, there had been only one rather simplistic evaluation in recent times and it was favorable to the CEO. Thus the board had no documented record to rely upon to support whatever action would ultimately be determined to be necessary.
The CEO has been on the job for over fifteen years and under his leadership the organization has grown into a multi-branch operation which is well regarded in each of the several communities it serves. The operating budget has grown some five-fold under his stewardship. Further, the CEO was well regarded by other CEO's in the state.
Not being privy to the details of the dissidents' complaints, I nonetheless reminded the board by way of a letter to the president of the positive contributions I knew the CEO had made in order that the board consider not only the complaints of the dissidents. The few board members who had been approached by these dissident staff members erred by not referring them to the organization's grievance process. The dissident staff members erred by going over the heads of the CEO.
The board president sought my advice in the matter. I suggested that he set up a small grievance committee made up of board members who had not been involved in the dispute and whose individual integrity was beyond question. They will hear out the dissident staff members' complaints as well as the CEO's rebuttal to those complaints and then make a recommendation to the board as to what ought to be done. I do not know how this issue played out having retired before the issue was decided.
However, for our purposes here the outcome does not make a difference. The point that is important here is that by not regularly evaluating their CEO's performance against the criteria of established mission related goals and CEO and staff control policies, the board had not developed a written record of its opinion of the CEO. Thus they laid themselves open to what amounts to manipulation by the dissident staff members. A series of good to excellent performance appraisals would have protected the CEO against a loss of confidence in his administration of the organization and thus the board could have evaluated the dissident staff members' complaints against that background.
On the other hand, a series of critical evaluations coupled with the dissidents' complaints would probably have provided the board with sufficient justification to terminate the CEO should the grievance committee's findings recommended this option.
Andrew Swanson is also the author of a recently published novel "The Grantor" and you will find it described in my first blog under that title. The blog provides a description of the novel and instructions as to how to order it. It is also currently listed by Amazon Books, Barnes and Noble, and Borders. Barnes and Noble's listing not only contains a summary of the book but includes a chapter long excerpt for you to sample.
Swanson is also an independent distributor for the Shaklee Corporation who, among some 250 products, manufactures a truly remarkable product called Vivix. Vivix provides an extended life span (up to age 125) for its users and overall good health for its users which makes the extension of user life possible. Vivix is described in a previous blog under the title "My Experience With Vivix". This blog also provides more description as well as ordering information.
Thinking that many of you who read my blogs might find this information useful in whatever type of board you might be involved with I decided to make a number of them available here. For those of you who have little or no interest in this subject, fear not, as I will not allow this one topic to dominate the subjects I will be writing about – except for the first three or four until I feel I have an audience for this type of material. Here now is the fourth of the first set of six blogs in this series.
BOARDS MUST EVALUATE EXECUTIVE RFORMANCE
This is essential for the protection of the CEO and his/her board. I had been working with a client guiding them through their strategic planning process. The board retreat had been held. Purpose, mission, mission related goals and critical issues had all been decided upon and these results expectations of the board had been turned over to the CEO and through the CEO to the staff to develop the implementation methodology in order to complete the plan.
One of the goals set by this organization was a structural reorganization of the staff. Three senior staff members, led by a relatively new senior staff member, were opposed to any change and they set in motion a good deal of grumbling amongst other staff. They also brought complaints about the CEO's management of the organization to the attention of a few individual board members who, without knowing the full story, openly sympathized with the complaining staff members. It is a fair assumption - although difficult to prove - that the leader of this palace revolt was after the CEO's job.
The board was perplexed and bewildered and their difficulties were made the worse because they had not been in the habit of evaluating their CEO's performance. Indeed, there had been only one rather simplistic evaluation in recent times and it was favorable to the CEO. Thus the board had no documented record to rely upon to support whatever action would ultimately be determined to be necessary.
The CEO has been on the job for over fifteen years and under his leadership the organization has grown into a multi-branch operation which is well regarded in each of the several communities it serves. The operating budget has grown some five-fold under his stewardship. Further, the CEO was well regarded by other CEO's in the state.
Not being privy to the details of the dissidents' complaints, I nonetheless reminded the board by way of a letter to the president of the positive contributions I knew the CEO had made in order that the board consider not only the complaints of the dissidents. The few board members who had been approached by these dissident staff members erred by not referring them to the organization's grievance process. The dissident staff members erred by going over the heads of the CEO.
The board president sought my advice in the matter. I suggested that he set up a small grievance committee made up of board members who had not been involved in the dispute and whose individual integrity was beyond question. They will hear out the dissident staff members' complaints as well as the CEO's rebuttal to those complaints and then make a recommendation to the board as to what ought to be done. I do not know how this issue played out having retired before the issue was decided.
However, for our purposes here the outcome does not make a difference. The point that is important here is that by not regularly evaluating their CEO's performance against the criteria of established mission related goals and CEO and staff control policies, the board had not developed a written record of its opinion of the CEO. Thus they laid themselves open to what amounts to manipulation by the dissident staff members. A series of good to excellent performance appraisals would have protected the CEO against a loss of confidence in his administration of the organization and thus the board could have evaluated the dissident staff members' complaints against that background.
On the other hand, a series of critical evaluations coupled with the dissidents' complaints would probably have provided the board with sufficient justification to terminate the CEO should the grievance committee's findings recommended this option.
Andrew Swanson is also the author of a recently published novel "The Grantor" and you will find it described in my first blog under that title. The blog provides a description of the novel and instructions as to how to order it. It is also currently listed by Amazon Books, Barnes and Noble, and Borders. Barnes and Noble's listing not only contains a summary of the book but includes a chapter long excerpt for you to sample.
Swanson is also an independent distributor for the Shaklee Corporation who, among some 250 products, manufactures a truly remarkable product called Vivix. Vivix provides an extended life span (up to age 125) for its users and overall good health for its users which makes the extension of user life possible. Vivix is described in a previous blog under the title "My Experience With Vivix". This blog also provides more description as well as ordering information.
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