Several years ago, State Employees Credit Union of MI did away with the traditional
way of creating strategy and of communicating it to management by means of a
Board/Management annual retreat. They stopped doing this in favor of a more
continuous process by adopting the Carver Policy Governance Model.
According to Steve Winninger, CEO, this board governance model calls for the
Board to govern his credit union through four basic policy groups or
categories. The first is the ends policy. This communicates in broad
terms why the credit union exists and what it means to accomplish for members.
The second is a listing of executive limitations, setting limitations
beyond which management may not go. The third maps the Board/Management
relationship. The fourth is a definition of how the Board governs itself.
All these are interconnected and must be considered as a whole body of policies.
The third policy above - on the Board/Management relationship - explains to
the CEO (who is the Board's only employee) that the Board makes the ends policy
but allows a reasonable interpretation thereof. The Board says that it will
accept reasonable interpretations but will also be the final arbiter of interpretations.
Accordingly, the Board is able to change policy rapidly and retains a very high
level of control of the credit union.
For the ends and limitations policies, the CEO is obliged to make regular reports
to the Board. Thus the Board is continually monitoring results. In effect, the
CEO first, interprets Board policy, second, develops a strategic plan to achieve
the ends aimed for in the policy, and third, reports results to the Board.
Under this model, policy is ever present, if somewhat out of constant view
owing to its lofty level, and everyone knows that it is subject to change without
the formality of an off-site retreat.
For SECU (MI), this governance model works well. The Board is in full control
but remains so at a very lofty level, setting high policy but not descending
to tactics and implementation. Management is allowed a reasonable interpretation
of these policies but well understands its limits and is continuously reporting
to the Board on results.
Would this model work for you? It is just one of many that you can use to facilitate
planning with your Board. Join
Callahan's on November 18th to take a look at 4 additional models for running
your Board planning session. You will come away with practical information,
including sample agendas, that will assist you in your planning efforts-whether
you use an outside facilitator or run the meeting yourself.