Friday, July 3, 2015

Board games

December 1997

Sooner or later it happens to most all reasonably successful (or durable) farmers - you are asked to serve on a board of directors for a coop, church, organization or governmental body. While this may be a sought-after personal goal, it could also be the result of not making your escape fast enough.

I have served on a variety of boards, both with and without other farmers. While there are many similarities, I have found “farmer boards” often possess certain common characteristics. Many of these mannerisms are rooted in tradition or habit, some are reflections of our profession, and a few are almost silly. If you are involved in a board, see if these sound familiar. If you could be serving in the future, maybe this can help you prepare.

Nodding Heads. Often groups of farmers prefer to operate by consensus, or to put it another way, “getting all the heads nodding”. Majority rule (an actual counted vote) is avoided when possible. Consensus has some advantages, but primarily it avoids any board member feeling like he or she has “lost” after a vote.

The big disadvantage to this mode of decision-making is it can require enormous amounts of time. This is the first thing to consider if board meetings tend to be marathon events. It is also highly dependent on a strong sense of community to be effective - where “getting along” is the highest good. Reliance on consensus also means the inevitable disagreements, however rare, become big issues.
Lately, many farmer boards have been forced away from consensus by time constraints and the growing individuality of members. However, once a handful of votes are taken, most boards adapt well to majority rule.

Supreme Court Syndrome.  The power of precedent can become overwhelming on farmer boards. This means not just doing it “the way we always have done”, but the compulsion to scrupulous consistency. It is often seen as unfair or a descent into operational relativism not to repeat identical responses to what seems like identical situations. For instance, if one employee is allowed to attend a conference, then any other employee must be allowed to attend any other conference.

This seemingly democratic ideal unfortunately ignores one key aspect of such decisions: all situations are not equal - in this case, some conferences are more valuable than others. Precedent as an absolute rule is actually a way to escape the responsibility of deciding - something many boards will go to great lengths to do.

Shop ‘til You Drop.  The most feared items on any agenda, in my opinion, are the purchase approvals. Usually expenditures above a certain limit require board approval, at which time personal preference and brand loyalty will ignite endless debate. There are three items that farmer members especially savor considering: pickups, copiers, and computers.

In the first case, every farmer is an expert on pickups. People who haven’t spoken in months feel moved to argue passionately about this one area of self-assured expertise. For copiers, this decision turns into a hate-fest for an entire industry. No copier has ever worked like it was supposed to, all are used twice as much as estimated, and almost none have proved reliable. We don’t want to buy any of them, but we know we have to. And when it comes to computers, the board will split into those who hate them and those who love them. Not much common ground.  Give me two hours of a dynamic CPA droning on with carefully chosen, liability-deflecting phrases about an annual audit any day.

Too Close For Comfort. Recent scandals in the military have revived an archaic term: fraternization. This practice of blending personal and professional relationships can cause big problems. On many small boards, especially in rural communities, board officers, specifically the president, often fail to maintain a respectful distance between themselves and the CEO or manager. Farmers are friendly people, and prefer to operate in an atmosphere of camaraderie, at least until something goes wrong.

Boards of directors in general have two great responsibilities: hiring and managing the CEO, and setting policy. Allowing a personal friendship to confuse the first obligation is professionally harmful to the manager, as well a dereliction of duty by the officer. Supervising a close friend is a difficult, if not impossible task, and subsequent lack of oversight allows sloppy practices to grow. Long term officers and staff must struggle to avoid this issue.

How Much? Farmer boards react differently than many other boards to manager salary discussions. Since many of us have no experience with annual compensation reviews, we struggle to put a dollar value on manager services.
There is also the titillation of talking about something most of us consider a deep secret: how much money you make. More amazing is the routine tendency to tie compensation to what kind of crop year it’s been.  Attitudes like these require strong leadership from the chair to prevent wandering into total irrelevancy and disaffecting employees.

Per diem.  Although farmers claim their time is valuable, few are willing to stand up and support board compensation. In truth, fair compensation is impossible, but some recognition of the sacrifice is important for morale.

All these comments may make it seem like farmers are poor board members. Quite the contrary. These foibles are simply the ones farmers often bring to the boardroom - other members have their own peculiar quirks. Recognizing them as a product of our way of life, rather than an unchangeable nature can help us to be more effective board members.

No comments:

Post a Comment