Remember that part of the circus when the tightrope walker comes out?

It’s the hold-your-breath moment of the show. Will they fall?

No. Of course they won’t. They never do.

Reaching a skill level that enables you to professionally perform in front of hundreds or thousands of people takes years of practice and experience. Tightrope walkers have great poise under pressure and have a clear understanding of the equilibrium they need to maintain in order not to fall. Tightrope walking has since made its way out of the colourful gazebos equipped with safety nets and into the real world. You now see YouTube videos of daredevils walking from cliff to cliff without any form of harness and the consequences of failure are very, very real.

So what has any of this got to do with NFP Boards? Well being on a Board is a lot like walking a wire, it requires the art of maintaining balance whilst being surrounded by tension.

The pressure is immense and you are being watched by many people who are relying on you not to fall – pressure to achieve social outcomes, pressure to stay within budget, pressure to reach unanimous decisions with Board and CEOs, pressure to satisfy employees, beneficiaries, customers and the community.

And for most (80% in fact) it’s not even a full time job.

Failing has real life implications. People who rely on the NFP organisation to lead a healthy life suffer directly as a result of this failure.

A chairman of the Board of a mental health helpline said that he loses sleep over the fact that 20% of his calls aren’t being answered. This is not the same as 20% of calls being missed by a for-profit. Those 20% of missed calls can lead to a potential suicide.

These are the consequences that NFP Boards have to think about. NFP Board members have to deal with a balance between trying to make changes and progress forward whilst maintaining stability for beneficiaries.

Behind a Board room door there are many complex issues and we have to consider this when we judge the effectiveness on a NFP Board.

That said, having a risk-averse Board is will lead to greater, larger challenges that are not easily fixed. Business as usual is spelling death for NFPs and transformations are imperative.So here are a few structural elements you can put in place to form the groundwork for an effective board that has the ability to create change whilst maintaining consistancy.

Skill Up

Circus performers are highly skilled athletes. Gone are the days of sideshow attractions of bearded women and ventriloquism. The circus is now a stage for immense dexterity and talent. It takes years of training to get to the level they are at. Each performer has his or her own core discipline whether it be flying trapeze, fire twirling or aerial hoop. All their skills make up one spectacular show.This is how you should build a Board, each individual with their own core specialty contributing to the greater show. Having an expert in legal, tech, finance, management, marketing and more, covering each department within the organization.

Be aware to not fill up your Boardroom with two extremes. Either highly skilled business folk who are more or less there to leverage networks rather than create social outcomes or a horde of dedicated, fanatical people that care greatly about the cause but are unskilled in areas of operational efficiency.

The ideal Board is made up of highly skilled people with business acumen, without fear of profit and a strong dedication to the social cause. Leverage your network to get the right people at the table.

Good governance

Behind the fantasy of the circus there is an administrator, an accountant and a stage manager. Good governance is key to putting on a great show.

Often a Board is a group of people who see each other 4 times a year and between those meetings scarcely communicate. The boring stuff is the key to being effectual. This means structured meetings, delegated actions and follow up. This is especially hard when it is not a full time job.

Diversify your Board

A few Boards have opted to have a beneficiary in the room. Deaf Children Australia has a deaf person; Foundation for Young Australians has a young person. This allows for varied views and being able to get a real understanding of what your beneficiaries may think of your ideas and decisions which is whom you are ultimately doing this all for. Also having a system in place for rotating chair in order to shake up the decision making process.

Form partnerships with values-aligned companies outside of the sector. Not only will this bring the skill but will also provide a safety net should you fall.

Have a Plan B

Too many Boards are gripped by fear but being risk-averse isn’t going to get you anywhere.

“When you prohibit failure, you prohibit innovation.” – Dan Pallotta

With government purse strings being yanked close, NFPs need to make changes and take dramatic, yet calculated, risks to ensure survival. Even those cliff walkers have a quick spin-and-grab technique they’ve rehearsed countless times, should something go wrong.

Create the infrastructure for your own safety net. Monetise your existing assets for a sustainable and steady revenue stream.“It’s impossible, that’s sure. So let’s start working.”
– Philippe Petit, Man On Wire

If you are interested in learning more about business strategy and sustainable business models

Download our Whitepaper on The Sustainable NFP