Answering the Perennial Question: Is It Governance or Is It Management?


Board members must understand the difference between governing and managing. If they don’t, they’ll soon find themselves lost in the weeds.

By Erica M. Osborne, MPH, Principal, and Cindy Fineran, Senior Consultant, Via Healthcare Consulting

For many new (and sometimes even experienced) board members, one area that is often confusing but nevertheless essential to the ability to govern effectively is understanding the difference between governance and management.

Governance is not familiar to most professionals and, therefore, is often not well understood. Most are familiar with what management does either because they have worked under a manager or have been one. However, many professionals often have little or no exposure to the work of a board. 

It’s not uncommon for one or two members, or even an entire board, to gravitate to the familiar, tangible, and often easier to deal with territory of operations. However, when a board strays into operations it steps on the toes of management and neglects its primary oversight responsibilities.

The Board’s Three Primary Roles

Every board has three primary roles. They include: 


Policies are the statements of intent that describe how a board wants the healthcare organization to conduct its business. These policies guide board and management decision-making and actions and provide the organization with direction. With a health system, some policies can be set locally; however, most policies are set at the system level and are not the purview of regional or local boards to amend. Policies that are set by regional and local boards, however, must be created within the framework of any applicable system policies.


A central function of the local board is to advise and consult on strategic decisions made by system and regional boards. These decisions need to be well-informed and guided by mission, vision, values, and policy. Board members are expected to read and assess all reasonably available information and to consider alternatives and potential outcomes before providing advice or making decisions.



The board’s duty of oversight is more important than ever before in today’s highly regulated and scrutinized healthcare environment; and regulators, accreditors and others will hold the board accountable for the organization’s performance. Oversight involves monitoring management decisions and actions to ensure they conform with stated policies and have the intended outcomes. The board should expect and receive regular reports from management on the organization’s performance. When decisions and actions don’t follow policy or fail to deliver expected results, the board’s responsibility is to ask management to develop a corrective action plan. The board’s oversight responsibility includes approving management’s plans and ensuring that corrective measures resolve issues. However, board members must remember that although this key responsibility is a priority, it is not the board’s job to police the hospital, administration, or medical staff; rather, it is the board’s job to provide guidance and support

As board members fulfill their roles, it is important to recognize and respect the role of the CEO and work in partnership with her or him. The CEO is responsible for deploying the organization’s resources in fulfilling its mission and promise and achieving its vision. To do this, the CEO:

  • Manages day-to-day operations;
  • Communicates the mission and strategy to employees and other stakeholders;
  • Develops and implements financial plans and budgets;
  •  Ensures availability and allocation of necessary resources; and
  • Serves as the health system’s representative and liaison to the community, medical staff, and board.

Governance or Management? How to Tell Them Apart.

The difference between governance and management is not always clear and may depend on circumstances; so, how can board members determine the difference? As a rule of thumb, governance is about vision and organizational direction while management involves the day-to-day running of the organization. More specifically:


• Boards set goals and objectives designed to achieve the organization’s overall strategic plan, make major policy decisions (within the overall organizational policy infrastructure), and oversee implementation.

• Management takes direction and counsel from the board, delivers results by implementing policy and strategy as set forth by the governing bodies, manages operations, and reports on performance.

When the balance between the board and management is established and functions well, the hospital or health system can meet the expectations of the community and ensure high-quality care is provided. When the board wanders into operations, however, it is like a ship’s captain leaving the helm and going down to work in the boiler room. The ship is left to drift aimlessly and is at risk for disaster. If this happens, the board and CEO may need to have an explicit conversation about their respective roles and come to an agreement on what those roles entail so everyone is on the same page.

Making the Distinction Between Governance and Management

“Nose in/fingers out” is a useful reminder of the difference between the board’s role and management’s role. Even though the board has an obligation to “stick its nose” in all key aspects of the organization and to be aware of what takes place, board members must resist the temptation to get into the weeds and micromanage. In other words, board members need to pay attention to what’s happening, ask questions, and monitor what’s working and what’s not. They need to understand risks, trends, and issues and provide counsel to management; they also need to “keep their fingers out” of operations and let management do its job.

A good way for board members to check whether the situation calls for the “nose” or “fingers” is to ask if the interest or questions about a particular topic or issue will inform the board’s governance perspective or role, or if it will help manage the situation better. Strong and effective boards bring all discussions back to the organization’s mission, vision, and strategic priorities by checking in regularly about how their time is spent. The vast majority of a board’s time should be spent informing the members’ perspectives on what is critical to fulfilling that mission, vision, and strategic priorities.

One of the most important roles of the board is to shine a spotlight on areas where improvement is needed. The board can and should insist on feedback and accountability from management on issues where there is an identified problem or priority. Often, just asking questions about a matter the board previously approved can help focus management’s attention on the feedback loop and performance. Although it is the board’s job to hold management accountable, it is management’s job to develop options for resolving issues and keeping the organization focused on the priorities.

When the Board Should Step into Management


There may be circumstances where a board needs to take a more “hands on/fingers in” approach in its governance. Examples of when this might happen include the loss of the CEO, a well-publicized issue around quality of care at a facility, or a financial crisis of some sort. These situations are typically time limited (though it may be several months or even a year) and generally involve more board meetings, closer monitoring of activities, and more actively involved decision-making. The board chair will play a key a critical role during this time. Once the situation or circumstances have been resolved, effective boards will bring themselves back to an appropriate level of governance oversight. 

Who Does What?

The chart below illustrates how to apply the theoretical concepts of governance and management in practical terms. The board and management must work hand in hand to carry out their responsibilities. For example, in most cases management creates quality and compliance plans, the board must review and approve them, and management then implements them. Once a plan is approved, it is the board’s responsibility to monitor implementation and the organization’s performance to plan and require management to take corrective actions if or when performance falls short.

Using several best practices, high-performing boards are adept at recognizing and respecting the distinction between governance and management. They focus on the high-level view and build trust with their CEO and his or her management team to carry out their responsibilities, following the direction and policies the board has set. Board members view their role not only as leaders, but as collaborators working in partnership with management. Effective boards carry out their monitoring and oversight as consultants, offering valued skills and experience, rather than policing management with a “gotcha” attitude. High-performing board members ask reasonable and probing questions, leveraging their experience and expertise to help ensure the organization’s success.

Examples of Governance vs. Management*

Key Function Regional Board Local Board Regional or Local Management
Regional quality and safety performance Approves the plan and monitors performance Is informed of the regional plan and performance Creates the plan, implements the plan following regional board approval
Local quality and safety performance Is informed of the local plan and performance Approves the local plan and monitors performance Implement the plan following local board approval
Regional compliance and risk performance Approves the plan and monitors performance Is informed of the regional plan and performance Creates the plan, implements the plan following regional board approval
Local compliance and risk performance Is informed of the local plan and performance Approves the local plan and monitors performance Creates the plan, implements the plan following local board approval
*These are examples only. Please refer to your board’s bylaws for specific accountabilities.

Questions for Boards to Consider

  1. How do we determine whether our board is clear in its understanding of the distinction between governance and management, and how well does our board respect that distinction?
  2. What are the expectations of our board and of the CEO regarding the role of the board and the role of management? Where do our expectations conflict, and how can we resolve conflicts?
  3. What circumstances might warrant a “hands on/fingers in” involvement? 
  4. What practices should our board adopt to ensure that we are providing appropriate oversight without getting “into the weeds”?

Gain Clarity with Expert Support – Governance vs. Management

Understanding the difference between governance and management is essential for effective healthcare leadership. However, navigating these complexities can be daunting. By partnering with Via Healthcare Consulting, organizations gain access to expert support and customized solutions tailored to their specific needs. With over 25 years of experience in healthcare governance, ViaHCC offers invaluable insights and guidance to enhance organizational effectiveness. From strategic planning to board development, Via empowers healthcare leaders to navigate challenges and achieve their goals. Book a call today to unlock the benefits of working with Via Healthcare Consulting.

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