Latest News, Governance, Insight, Private Clubs, Strategic Planning, Governance Insights & Resources, SI Insights, George Pinches
Monitoring club performance is essential for the Board to be accountable to members. The trend in business and non-profit organizations is for data driven decision-making. Boards and GMs prefer objective measurement of goal achievement by using key performance indicators (KPIs) tracked on scorecards and dashboards. It is also important for the Board to evaluate its own performance regularly, at least annually. In essence, what gets measured gets managed.
The Policy Governance Principle of Rigorous Monitoring must be applied consistently through Board Policy. Performance is best measured against agreed-upon criteria. Some of the items listed below are of a tactical or practical nature. However, they support Policy Governance principles and the Club Governance Model.
The Board’s Role in Goal Setting
The Board has an important role in not only establishing its own goals, but also in ensuring that the General Manager (GM) has every opportunity to be successful when establishing his/her annual goals. The Board is responsible for the following items:
Determine the club’s strategy, its major goals and desired outcomes
Set appropriate limits for the GM through the establishment of executive limitations policies
Provide the GM with the authority, flexibility, and resources to successfully complete agreed-upon goals in the allotted time
Specify the objective results goals, the ends – the term used in the Carver Policy Governance Model.
Monitor Board and GM performance including holding itself accountable
Make Monitoring Club Performance a Board Policy
Monitoring club performance should not be left to chance. It must be set out in writing and agreed to, in advance, by the Board and GM. Monitoring is Board policy. The following items explain how to incorporate monitoring club performance into policy:
Incorporate the club strategic plan, the Board and GM’s goals into the Board Policy Manual (BPM), directly or by appendices.
Incorporate the monitoring of the GM’s performance into the BPM with sufficient detail to make monitoring as automatic as possible using a specified process, consistent documents and scheduled times.
Incorporate the GM’s performance evaluation into the BPM for clarity and consistency.
Management’s Role in Goal Setting
Management must take an active role in setting goals and monitoring performance. A passive approach leads to undefined and unattainable goals resulting in poor performance reviews. As the Board’s only employee, the GM not only participates with the Board in setting his/her goals, the GM then communicates these goals to the management team. Ideally, the GM’s goals, and therefore the Board’s goals, are consistently communicated to every staff member to align all activity and maximize the use of club resources. Management is responsible for the following items:
Determine the means - Once the goal is set and clearly defined, communicate to the Board that management will decide how the goal is accomplished. Management must secure the authority, within executive limitations, to accomplish the goal without the undue interference. Responsibility without corresponding authority defeats accountability. It is better to be reminded than instructed.
Determine limitations - Report what cannot be done with valid reasons why and ensure that unrelated outcomes are not bundled into a goal. Goals must be achievable. This is often determined by a dues-based budget. Many clubs set stretch goals that cannot be achieved based on the level of funding from dues and other sources. Avoid moving goalposts and undefined targets; management must be diligent in avoiding goal creep. Similarly, overarching subjective goals should be avoided.
Establish the monitoring process - when-what-where-in what form-to whom. The timing of interim reports is particularly important. Simplify the monitoring and reporting process using KPIs, dashboards, and scorecards. A simple and clean visual representation is better than pages of text.
This article was authored by GGA Director and Governance expert George Pinches.
Subscribe To Our Latest Insights!
Follow Our Thinking
September 15, 2022
The Challenge of Club Governance: An Interview with Damon DiOrio, CEO, Desert Mountain Club
Damon DiOrio, CCM, CCE has long been recognized as one of the top general managers in the private club industry, stemming from his 14 years leading the Charlotte Country Club and […]
September 15, 2022
An Anatomy of Two Committees
Strengthening the Nominating Committee; Questioning the Executive Committee Of all the club committees, none is more important that the nominating committee and none is less […]