Improving effectiveness as a governing board member requires understanding the distinct modes of governance and how each can enhance board performance.
By Erica M. Osborne, MPH, Principal, and Kara Witalis, MHA, Principal, Via Healthcare Consulting
As any board member knows all too well, the work of a healthcare governing board is complex. As with any worthwhile endeavor, it just takes practice to become better. Effectiveness, both individually and as a collective board, can improve as a board member understands and becomes proficient in the three modes of governance: fiduciary, strategic, and generative.
The Modes of Governance Explained
Each mode serves a distinct purpose. Fiduciary is oversight. Strategic is the compass. Generative is forward-thinking. Fiduciary and strategic governance form a solid foundation of governance work, but highly effective governing boards use all three modes for different areas of their work and at different times in their work.
Fiduciary
Fiduciary is perhaps the most synonymous with governance. Fiduciary duties are those of obedience, loyalty, and care. Fulfilling these duties as hospital board members is rooted in the commitment to the mission, to disclose conflicts of interest, and to come prepared to meetings. This work involves oversight, stewardship, accountability, and compliance.
In this mode, the board is the watchdog.
Key questions boards address in the fiduciary mode include: How is our organization fulfilling its mission? Are we acting in the best interest of the organization and our communities? Do we have a clear understanding of the compliance and regulatory landscape affecting the organization? Are we in compliance?
A hospital board is in the fiduciary mode of governance when:
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- A board member self-discloses a conflict of interest and recuses himself or herself from related board/leadership discussions; or when
- A local board reviews and approves credentialing policies and grants/denies provider privileges.
Strategic
Within this mode, the board focuses on planning and big picture discussions of how to get from the present state to a desired future state.The strategic mode is about affirming the mission and the vision, charting priorities, and reviewing and assessing performance.
In this mode, the board’s role is the local barometer.
Key questions a board would ask include: Are we thinking ahead, anticipating the future of such things as community health needs, market trends, or stakeholder relationships and priorities? What are the organization’s strengths, weaknesses, opportunities, and threats? What should we be doing differently to achieve our future goals?
A hospital board is in the strategic mode of governance when:
- A board discusses whether it has accurately assessed its community’s social determinants of health and health care needs and whether its organization is adequately meeting those needs; or when
- A board receives a briefing on recent market dynamics (including but not limited to new market entrants, provider mergers and affiliations, payer movement), discusses the implications, and considers organizational response and direction.
Generative
While fiduciary and strategic governance involve the “what” and the “how,” generative governance involves the “why.” Generative discussions involve exploring ambiguity, uncertainty, and those areas of deep importance to stakeholders.
The board is in the generative governance mode when it asks questions and has deep discussions on what it all means. Generative governance is philosophical, contemplative, and actualized. It is the board equivalent of the top of Maslow’s hierarchy of needs pyramid. It gives shape and recognition to the purpose of the organization and, effectively, generates the work of the other two modes. Before an organization develops strategies or solves problems, it must first make sense or meaning of itself and its universe. The generative mode is both forward-thinking and retrospective.
In this mode, the board is the sage.
Key questions hospital boards would address in the generative mode include: What are the most significant issues for the hospital and for our communities? What are the problems of the future? What are the new possibilities? What is the greater purpose? What does our organization represent and why? Where were we, where are we, and where do we want to go with this organization? Answers should not come easily, but reached through vigorous, ongoing discussion.
Hospital boards are in the generative mode of governance when:
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- They have meaningful discussions around how and why people get sick. Or, they ask: What is health for our community?
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- They oversee the pursuit of partnerships with non-traditional outside organizations to create greater impact on the health of their community.
Tools for Elevating Board Performance—Practical Tips
Not surprisingly, generative can be the most challenging mode of governance to grasp and use. The competencies and traits that enable generative governance include critical thinking, curiosity, open-mindedness, and a willingness to accept criticism. In generative governance there are no black and white answers, but various ways of looking, probing, and grasping at not only what the answers are, but what the questions should be. The bigger picture is what drives discussion.
Key practices that support better boardroom discussions include:
Working in Conjunction with Leadership.
Generative thinking is a shared process done in tandem with the chief executive/executive team. Together, leaders question assumptions, probe feasibility, and identify obstacles, opportunities, and alternative ways of framing issues.
Having a diverse board composition.
The board composition should be balanced and diversified. Generative thinking thrives on participation among participants with different perspectives for noticing different cues and clues.
Curating meeting materials.
Pre-meeting reading materials should be carefully curated to include high-level, strategic level information. These materials should be provided well in advance of board or committee meetings, and board members should be expected to come to the meetings prepared to share their perspectives and ask probing questions.
Designing efficient agendas.
Meeting agendas should be tied to organizational mission and strategy and allow board members the time and resources for critical thinking and debate on crucial issues.
Consent agendas should be used to save time. With a consent agenda, routine matters that need board approval are combined into one item on the agenda that the board can vote to approve or deny.
Fostering engaging board discussion.
For more complex matters, board members may be given a “silent minute” to consider the issue from their unique perspectives, write down thoughts and questions, and share those thoughts in a round-robin discussion. This practice enables dialogue that is more meaningful and meatier.
To foster better understanding of divergent views, board members might be asked to assume the perspective of different constituent groups likely to be affected by the issue.
Breakout sessions can promote participation. Small groups expand available “airtime,” easy participation by reticent board members, and counter groupthink.
Questioning should be open-ended, focused on long-term considerations, and related to the organization’s mission and goals; they should begin with “why” and “how” to probe at assumptions and generate new insights. For example:
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- Why are we considering this issue?
- How can we see the situation differently?
- How do you make sense of this?
- Why does this issue exist or persist?
- What is the best possible outcome and worst-case scenario?
- How can we approach this issue differently?
- What are the next questions that we should discuss?
Reaching Higher
The responsibilities of hospital governing boards are considerable. The board is more than a watchdog, more than a barometer. Each board must make sense of the issues presented and imagine a preferred future based on what is important to its organization and to its community.
Fulfilling the fiduciary role is a must. Providing strategic guidance ensures performance. Generative governance elevates the board’s work to a new level of leadership.
Source: Chait, Richard P., William P. Ryan, and Barbara E. Taylor, Governance as Leadership: Reframing the Work of Nonprofit Boards. BoardSource, Inc. 2005.
| Fiduciary | Strategic | Generative | |
| What it is | Financial and asset stewardship, oversight, compliance, accountability, risk management, set policy | Approve goals and priorities, monitor progress and performance | Identify organization’s purpose/mission and values‐its identity, ensure mission and values drive strategies, decision‐making |
| Core work | Technical—ensures accountability | Analytical – shapes strategy, review performance | Creative – discerns problems, engage in sense making |
| Key questions | What’s working and what’s not? | What’s the plan? | What’s the question? |
| Way of deciding | Reaching resolution | Reaching consensus | Grappling and grasping |
| Performance metrics | Facts, figures, finances, reports | Strategic indicators, competitive analysis | Signs of learning and discerning |
| Sources: Hurtubise M, Goodine S. Moving Toward a Generative Governance Model. London InterCommunity Health Centre. Brew A. Strengthening Leadership and Governance for Nonprofit Boards. PwC Canada. February 23, 2015.Using Generative Governance Principles for Better Boardroom Conversations. BoardSource. 2017. www.boardsource.org. | |||
Questions for Boards to Consider
- What issues/situations in our organization necessitate the use of strategic governance?
- How can we be more strategic in our discussions?
- How well do we understand the concept of generative governance?
- To what issues within our organization should we apply generative governance?
- How might our board change our approach to discussion to gain a more holistic understanding of issues and solutions?
Gain Clarity with Expert Support – Three Modes of Governance
Navigating the complexities of health care can be daunting. By partnering with Via Healthcare Consulting, organizations benefit from 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 governance effectiveness. From strategic planning to board development, Via empowers healthcare leaders to overcome challenges and transform their organizations. Book a call today to unlock the benefits of working with Via Healthcare Consulting.
