Seasons are all around us. As we enter spring we see the emergence of new life. In sheep country we see new lambs, we see new flowers blooming. In offices in the new financial year, we see the presence of auditors in our midst.
Farmers, and indeed any producers know how to take advantage of the inherent rhythms and cycles of the seasons. No successful farmer would decide to ignore the weather patterns and plant when they felt like it. By exploiting the natural rhythms in an office, governance and operations can also be more efficient and effective.
Effective change management should always take advantage of current conditions to effect change in a positive way, considering the extent to which those having changes imposed are able to cope with the extent (including speed) of the change. After the disruptions of the past couple of years, seasons and patterns are just starting to be reidentified. And by now we should have enough data of ‘our new normal’ to see the new patterns emerge. Success should not be, let’s just do what we used to do, but let’s do what we used to do, even better.
With so much change having been imposed on all through Covid-19, just reinstating existing rhythms may be a lost opportunity, but by leaning into the inherent cycles in our entities we can leverage our natural workflow. Any new changes should have an element of stability, surety, and reliability.
Take the time to do a quick analysis of your ‘seasons’. What are some of the inherent patterns or cycles in your business practice (business in its broadest sense, including NFPS and small operations).
The minimum compliance we all have to adhere to is that around the end of financial year. What work and reporting is associated with this? Unfortunately, I am aware that some boards don’t even see final auditors’ reports. Inclusion of existing reports is an easy first step. How are you able to leverage that work which has to be completed for other purposes? Is the information that has been extracted put to good use? If you are an entity that must comply with accreditation requirements, or provide acquittals by reporting, are you exploiting that effort to good use?
Some of the best advice I have received which can be applied in many instances is, write it once, use it many times. Accreditation or acquittal reports may need slight redaction or summarising but taking the time to make some adjustments will enable those reports to be utilised in many forms.
Reporting to Boards.
The Corporations Act states that Directors are responsible for any entity, but in the day-to-day operations it often doesn’t feel like this is the case. In a functioning board the chair drives the conversation, mostly through the agenda, but the executive are the ones that live and breathe the operations of the entity on an hourly basis. By establishing reporting patterns utilising the inherent rhythms and cycles of an entity, boards can be kept up to date with operations, thereby having the confidence that operations are safe, and compliance is occurring.
Meetings often get a bad wrap and are seen as time wasters but if a pattern of good agendas, minutes and reporting upwards is established, they are the exact opposite and indeed are the basis of good governance.
Sub-Committees should exist to do the heavy lifting, to drill into the data and check the detail. My practice has always been to write papers or reports to accompany agenda items to enable the conversation to be directed. These documents form the board or sub-committee papers that give life to the minutes. When the minutes and the necessary documents are included in board papers, the board has confidence in knowing that the sub-committee has done the heavy lifting and can comfortably accept the committees’ recommendations to pass the necessary motions. Once again, this information should be presented in a coherent manner to the board.
Other considerations for good reporting are dashboards and summaries. Feel free to contact Zamagias Consulting if you would like help identifying the inherent rhythms and cycles in your entity, and how the relevant information can be summarised and reported upwards.
There are a few enemies of good board reporting, two come to mind.
Leaving it to the last minute.
Unfortunately, this is too common. Most boards I have been associated with, from either a management or director perspective treat board reporting as something you worry about at the last minute. Allowing board papers to be issued at the last minute does nobody any favours. It creates sloppy papers, unprepared discussions and usually leads to poor outcomes.
Strict cutoffs are essential to enable good preparation. Once again if rhythms are established where key sub-committees meet a couple of weeks before the board meeting with recommendations, the board can act in a timely manner. There may be occasions where late papers are required but these should always be minimal.
Manic episodes of improvement.
Some of the suggestions above, may seen a bit daunting. But they need not be hard. Indeed, this point is to warn against going about changing everything in one fowl swoop. On too many occasions I have seen attempts to ‘change processes’ radically without the time, effort or understanding of what the implications may be on those required to carry out the changes. If you read my article “if a thing is worth doing, it is worth doing badly’ you will see that I recommend seeking best fit for purpose solutions that usually mean starting with small steps. Look at the readily available reports you have and ensure they are reported to the board. Get in the habit of producing a one pager (even if it is only half a page) with the purpose of guiding board discussions with helpful suggestions.
I used to start my report to the board the day after the meeting, even if it were only in point form at the start. These headings or notes prompted me to make sure I didn’t leave anything out to report to the board. Reports should provide options, explanations, and direction for the board discussions. Reports may not be able to pre-empt all the board’s questions, but where possible, papers (even if they are appendices) can help supplement and fill the gaps.
Reporting upwards doesn’t just fill in the gaps, it gives the board understanding, familiarity, and confidence that processes are in place to ensure sound operations.
コメント