Linking Strategy, Governance, and Leadership Succession: The Role of the Board 2017 Governance & Leadership Conference March 7, 2017 Presented by: Frank Martinelli The Center for Public Skills Training

Three Critical Processes Governance Strategy Succession Three Critical Processes

Governance As Leadership Richard Chait, William Ryan & Barbara Taylor

3 Modes of Governance Fiduciary Mode – Board as Sentinel "How are we doing to date?" “Are we in compliance?” Anything wrong? Strategic Mode – Board as Strategist "What should we be doing?” "Where are we going?“ What’s the plan? Generative Mode – Board as Sense-maker “What are the new possibilities?” “What’s coming next?” What’s the new question?

What’s the new question?   Fiduciary Mode Strategic Mode Generative Board’s role Steward/ Watchdog Strategist Sense Maker Key question What’s wrong? What’s the plan? What’s the new question? Problems are to be Spotted Solved Framed Way of deciding Reach resolution Reach consensus Reach understanding Current Estimate % of Board Time Devoted to Mode Future % of Board Time Devoted to Mode

Strategic Thinking and Planning

Strategic Planning Strategic Planning is the process by which the guiding members of an organization envision its future and develop the necessary plans, procedures and operations to achieve that future.

Make Decisions About . . . Mission, vision and strategic priorities Whom you will serve Your organization's role in the marketplace, industry and profession Future product/service offerings Resources needed to succeed Leadership needs How to best combine resources, product/services and relationships for mission impact

Leadership Succession Planning More Than Replacing the Departing CEO

Types of Succession Planning Strategic Leadership Development Departure Defined Transition Emergency Succession Plan

Succession Planning Offers … A comprehensive, strategic approach that prepares the organization for inevitable vacancies in key positions Continuing education and development in a variety of leadership areas Professional advancement of staff as it relates to opportunities and promotion A practice that makes organizations more nimble and flexible

Types of Succession Planning Strategic Leadership Development Departure Defined Transition Emergency Succession Plan

Emergency Succession Planning A thoughtfully prepared plan to address an unanticipated departure of a CEO, usually occurring with only a few days or weeks’ notice Best practice to support the uninterrupted performance of essential executive functions by outlining steps for the temporary appointment of an acting and/or interim CEO

Strategic Leadership Development An ongoing process that identifies the core competencies, skills and knowledge needed over the next few years Development of a plan to enhance those competencies in existing talent and/or recruit new talent

Departure Defined Transition A course of action that board members and CEOs can employ when an actual “end date” has been determined for the CEO. Focuses on: Communicating the transition to staff and stakeholders Conducting an organizational assessment and making improvements where possible Recruiting and hiring a new executive, and On-boarding the new executive

Board Succession Planning A plan for developing current and future board leadership: Who will be leading the board over the next five years? Foster and develop future board leadership A critical board responsibility Connection to strategic plan Linked to board recruitment and training processes

What is Board Leadership Succession Planning? Succession Planning is the use of a planned program to ensure that new high performing leaders are developed to successfully replace board leaders whenever needed to carry out the mission, vision and goals of your pool.

Life Cycle of a Board Leader A framework for board succession planning: Comprehensive leadership development system Variety of involvement options before, during and after board service Use of standing and ad hoc committee structures

Three Critical Processes Governance Strategy Succession Three Critical Processes

Internal Board Systems and Practices That Facilitate the Linkages Laying the Foundation

Board Systems and Practices Standing governance committee leads the effort Engaging the board in strategic thinking and planning Aligning board development with your strategic plan Incorporating strategic deliberation into every board meeting Using committees and workgroups as "powerful engines” of governance, strategy and succession Building a board leadership talent pipeline

Linking the Three Processes Addressing board governance and succession as critical issues in a strategic planning process Worksheet: Succession Planning As an Opportunity for Strategic Thinking: Starting the Conversation with Your Board of Directors Worksheet: Executive Self- Reflection Questions

Tools for Linking the Three Processes

Linking the Three Processes Foremost Challenges Worksheet Critical issue briefing papers Addressing board governance and succession as critical issues in a strategic planning process Worksheet: Succession Planning As an Opportunity for Strategic Thinking: Starting the Conversation with Your Board of Directors Worksheet: Executive Self- Reflection Questions

Foremost Challenges Worksheet Foremost critical issues and challenges that the pool needs to address over the 1-3 years. (How should board frame the issue?) What roles would be appropriate for the board to play in addressing each issue listed in Column 1? Clarify the board's need for information and education re: this issue. (To make good decisions in response to this issue, what will the board need to know and be able to do?) What resources can the Board access to help address this issue?

Critical Issue Briefs Opportunities and threats for the pool? How are other pools responding? What major choices, decisions and/or shifts in direction does this issue challenge us to consider? What are high leverage strategies that will help us respond to this issue?

Review the Three Scenarios Considering current conditions in your pool, select an entry point for exploring possible linkages between strategy, governance, and/or succession. What opportunities do you see? When governance leads … When strategy leads … When succession leads …