Five "Next Practices" for Board Business-Model Stewardship
By: Jeff De Cagna, FASAE
If boards are going to stop "killing" their associations' business models (see my article "5 Ways Boards Are Killing Association Business Models," Associations Now, March 2013), they will need to experiment with a variety of "next practices" to build their capabilities for energetic business model stewardship. Below are five such practices for association boards to consider:
1. Refocus fiduciary responsibility on revenue growth and sustainability. By building a deep and shared understanding of the association's current business model—how the association creates, delivers, and captures value today—the board can refocus its thinking about fiduciary responsibility on how it can best work with the executive team to integrate the organization's purposeful action with the identification of new profitable and sustainable revenue streams. Instead of operating from a defensive posture, the board can establish a more proactive collaboration with the C-suite to build the association to thrive in the years ahead.
2. Build technology capacity through actual use. Some association leaders believe that having the board pursue its governing work using an online platform is simply about saving money or being "green." While those are important secondary benefits, the primary rationale for putting governing online is shifting the board's mindset from analog to digital. A board that operates exclusively out of three-ring binders will find it much easier to see the world in black-and-white terms. A board that can interact effectively using social, mobile, and related technologies will be able to have richer and more meaningful conversations about applying those same platforms to the association's broader value creation efforts.
3. Crowdsource strategy. In my recent e-book, Associations Unorthodox: Six Really Radical Shifts Toward the Future, I challenged associations to move the work of strategy out of the boardroom and toward the organizational edge to tap into the insights and imagination of stakeholder networks that extend beyond the boundaries of membership. Through crowdsourcing, associations can surface previously inaccessible resources that can be used to create new value. Instead of functioning as the primary creators of strategy, the board and executive team can play equally critical roles in orchestrating collaboration, championing new ideas, and investing in opportunities for game-changing business model innovation.
4. Develop an innovation agenda. As the association's principal investors in innovation, the board can collaborate with the executive team to clarify their shared investment priorities through an innovation agenda. An innovation agenda offers the board the chance to codify and share its specific areas of strategic and financial commitment to the ongoing work of new value creation. Even as the crowdsourcing of strategy creates a flow of innovation opportunities, the board can use the development of its innovation agenda as a frame in which to have an open discussion of its risk tolerance for different types of innovation.
5. Institute "20 percent time" for the board. One of Google's most widely reported innovation practices is allowing its employees to use 20 percent of their time to work on creative projects. This can be a generative practice for the association board as well. If the board commits to spend at least 20 percent of its time discussing the association's current business model and emerging opportunities for business model innovation, it will be able to engage more deeply with the challenges facing the association and the sector it serves, as well as its current and future stakeholders.
Many association board and staff leaders will ask how they can be certain these approaches will work for their organizations. I propose that they ask a different question: What can they do to effectively adapt these practices to meet their organizations' needs? The first inquiry is about the comfort of knowing, while the second is about an openness to learning. To build a deep capacity for business model stewardship, association boards must make constant learning, experimentation, and innovation their top priority. Will your board accept the challenge?