Leading through Policy with the Policy Governance®
(Using the Policy Governance® Model as developed by Dr. John Carver)
Leadership in Policy Governance®
What is the board’s role? Some say that it is to watch after management. How can the board lead if they are watching “after”? This indicates that they let the manager act first, and then correct them if they make a mistake. This is not leadership.
Policy Governance® recognizes that the board should not just be called leaders but that they should actually do the leading. In their role of representing others, some higher authority than themselves, they are the link between the wishes and desires of those they represent and the operation that will be built and managed in order to accomplish those wishes and desires. Their role is to make sure that the organization actually does so, while avoiding any imprudent action that would violate the values and trust of those they represent or put the organization at an undue risk.
How can they best do this? They do not have the time, nor likely the expertise, to actually be present and to make the day-to-day decisions of that operation. How can they lead for results and safety without actually being there?
Policies – What are they?
The method through which the board can lead the organization without actually being present on a daily basis to make the decisions is by developing policy. Most decisions are based on a framework of values or perspectives. What do we hold important? What criteria should guide our decisions? In Policy Governance®, the answers to those questions become explicit and available to all through policy.
Policies are written statements that are designed to provide that framework of values and perspectives and thus guide further decisions. They set up rules, defining what is to be accomplished and what should not occur. The policies are embodiments of the values and perspectives of the greater authority that the board stands in to represent. If policies direct all further decisions, then the best place for leadership is in the development of policy.
The Logic of Policies
If policies are to be used for decision making, they should be usable. They should be clear, and organized in a manner so that they can be readily accessed. They should have a logical flow that aids in their clarity and ability to be understood. And they should be written with very exact use of language so as to avoid any possible misunderstanding or confusion.
Policies are of different sizes or scopes. Just like the Earth is smaller
than the Universe, but bigger than North America, any given policy fits somewhere
in a spectrum of biggest to smallest. Consisting of language rather than physical
being, policies are probably better thought of as being within a spectrum
of broadest to narrowest. To be usable, board policies need to clearly indicate
where they fall in that spectrum.
Policies in Policy Governance® are always stated at the broadest level first. Broader policies are bigger, more general ways of stating a position of values or perspectives. To say that you value dogs as pets also indicates, if left at that point, that you value all dogs (size, color, breed, and temperament). Each broad value or perspective contains many smaller ones. If the board needs to address these smaller sizes in order to express the framework it is building, it does so. For example, you may also want to say that you value dogs as pets, but only dogs that do not bite. To maintain clarity and order it does so only one step at a time. It does not jump from the broadest to anywhere it is interested but must rather proceed, logically, only to the next lower, then the next, then the next.
If the board starts below the broadest or skips a level, it is possible that a given decision or issue may fail to be addressed. If the issue or decision is at a lower level than the scope of the board’s framework, this is not a problem because it has already shared its values and the decision, staying true to what the board has said, will result in an acceptable outcome. If a gap in policy results in issues not being covered in an area or at a level in which the board does have a value or perspective, it opens the chance for a decision or action to lie outside of the framework.
By beginning policy with the broadest way of addressing what it is the board wishes to say, it will know that it at the least has control at that level. Any decision made below it will be addressed at the outer most level. By developing further policy one level at a time below that broad statement it ensures that there are no gaps between one level and the next. This continues to logically seal off the area that it addresses, so that the board’s perspectives and values are more and more well defined until such a point that the board no longer cares about the interpretation of its words. Moving level by level, the board builds a stable and complete set of outer policies that will hold and contain those inside them.
At some point the board will feel that it has said enough. Its values and
perspectives will have been accurately captured. How will it know when this
point is reached? When it can accept any reasonable interpretation of what
it has said. That is, would any possible interpretation by a reasonable person,
using the policies as written, result in a decision, outcome, or situation
that the board would find acceptable? If so, they have said what needs to
be said and may stop. If not, there is more that they must say to capture
the framework they are forming.
Any reasonable interpretation is essentially already approved by the board. The board is basically saying that you may make any decision within this framework because we articulated our values and perspectives. If you follow what is written, you will be in compliance with our desires.
By stating the first (or Global) policy, the board has already limited the range of interpretation allowable. At any time it is uncomfortable with what any reasonable interpretation may be, it continues to a new and the next lower level. This in effect further limits, or reduces in size, the range of allowable interpretation. In this manner, the framework that a decision must fit within gets smaller and smaller at each further level of policy.
In a like manner, by choosing to start where it does within the Global policy, the board has also limited what it can address at lower levels. If the Global policy is the broadest one, and each lower level is narrower, then the only purpose of a lower level is to further define or delineate the level above it. If a value or perspective has not been addressed above, it cannot be addressed below.
In Policy Governance®, it has been discovered that there need be only four areas of policy content which address all of the important aspects of an organization. With policies in each of these four areas, there is a complete framework of values and perspectives to guide all areas of organizational decisions.
These areas, briefly described, are:
1. Ends Policies – these policies deal with the issue of defining what the organization exists for. Specifically they define what benefit is to be created, whom this benefit should be for, and at what comparable value this set of benefits for this identified set of recipients is worth. It is always stated in terms of the customer who receives the benefit.
2. Executive Limitations Policies – These policies are how the board directs the choice of operational methods and organizational conditions. Rather than telling the CEO what to do they tell the CEO what methods cannot be chosen in pursuit of the Ends and what organizational conditions or states would be unacceptable, even if the Ends were achieved.
3. Board/CEO Linkage Policies – These policies describe and define how the board’s authority is passed to the CEO, how the board will check up on the organization, and how the board will exercise direction to and authority over the CEO. It spells out the roles of the two and the relationship that they will have.
4. Governance® Process Policies – These policies are the explanation of, and agreement to, the methods that the board will use to accomplish its own work. They define the board’s value-added job, its style of interacting, and its process for making decisions.
If the board is going to be so precise in the way that it develops policy, it should also be very precise in the way that it captures and records those policies. The purpose is to make sure that a framework for further decision making and action is not only available but usable. For clarity it is important to record the policies in a logical manner that will show the board exactly where it has left off and allow the person using the policies to quickly determine what has been said and what leeway they have available to make the decision.
Policy Governance® policies do this by starting at the broadest level in each of the four areas. This broadest statement about the values and perspectives of the board (standing in for some group with even higher authority) is illustrated as being on the outermost edge of a circle. It is often called the Global Policy because it applies to all else below it. If the board has more to say, it develops policy at the next more specific level. This is a sub-policy. These sub-policies will be developed until the board is comfortable with any reasonable interpretation. To illustrate the order of the policies and to help parties identify at what level it stopped, policies are often treated as though an outline. The Global policy is for example 1.0, the first level of policies below it are 1.1, 1.2, etc., and below that are 1.1.1, 1.1.2, 1.1.3, etc., and so on. In the actual policy this hierarchy is illustrated by indenting each successive level one step further in (see below).
1.0 Global Policy
1.1 First level Sub
1.1.1 Second level Sub
1.1.2 Second level Sub
126.96.36.199 Third level Sub
How to Develop Policies Initially
While each board has a separate set of values and perspectives, they often center on very similar topics. John Carver, the inventor of Carver Policy Governance®, has captured these central areas of concern into a set of Sample Policies. They may serve as a starting out point for a board’s development of an initial policy manual designed for practicing Policy Governance®.
A good way to begin is for the board to produce a list of those things that is worried about in each of the four policy areas except the Ends. What is it worried that might happen or might not? What would be unacceptable to it within that particular area?
With that list in mind, consider the Sample Policies one area at a time and
one policy at a time, starting with the Global Policy. The board deliberates
a number of questions and makes a group decision concerning how the policy
should be worded to best capture the values and perspectives that the board
holds on this issue. For each Sample Policy, the board will deliberate and
1. Is this policy pertinent to our organization? Do we have any concerns about the concept it represents?
2. If it is pertinent, are we comfortable with the preamble (opening statement)? Do we have any concerns about what is said or how it is said? If so, what is the group’s decision about what and how it should be said?
3. After the first level, has the board said enough? Are the values and perspectives it wants used in this area sufficiently defined and delineated that any reasonable interpretation of these words would be acceptable?
4. If so, move on to the next policy.
5. If not, consider the next lower level of policies, using the same approach as above.
6. When all of the Sample Policies have been edited so that they now represent the values and perspectives that this organization holds, the board must ask itself if there are any areas that it wishes to address that are not covered within the Sample Policies.
7. If so, it must determine what worry or concern it has, frame that worry or concern in an issue, and then state the values and perspectives concerning that issue at the broadest possible level.
8. Once the broadest level is stated, the board completes the process above, starting with #3.
How to Develop Policies after the Policy Manual is Adopted
After the policy manual is adopted, policy making has not ended. Policy making is a perpetual task and primary output of the board. Since the board has decided that the most effective way for it to govern is through policies, then any issue it faces must be dealt with within policies. If the policies are found to be based on incorrect assumptions, proved wrong by experience, or found to be incomplete, the board has more work to do. If the policies are the only tool it uses to control and direct the organization, then it must constantly assure that the policies available are appropriate and complete. Policies are written for clarity but can be changed at anytime that the board, following its agreed upon process for deliberating and deciding, chooses to do so.
When a new issue arises the board must maintain the logic and discipline
of the model that are the cause of much of its power. To do so, it should
follow the sequence of steps below:
1. First, it must determine which of the four policy areas this issue lies in.
2. Second, it looks to see if it has already said something that is in anyway connected to this issue.
3. Third, if it has said something, does the current information it has indicate that it has said enough, that the values and perspectives it has already stated are complete enough to allow any reasonable interpretation?
4. If not, more policy is needed. What is the broadest way of stating the issue and at what level does it logically fit within the current policies? Which level of policy does it further define and delineate?
5. If yes, the current policy stands and any reasonable interpretation of it is still acceptable.
6. If new policy is developed, the board follows the same process of moving to deeper levels of definition and delineation one level at a time until any reasonable interpretation is acceptable.
Using Your Policy Manual
The Policy Manual should always be up to date and available. Ideally, each board member will have an accurate and timely copy with them. When an issue arises, the board will deal with it through policy, so the first place to start is with the policy that it has already written.
1. Determine which of the policy areas the issue is associated with.
2. Open your manual and turn to the Policy Manual Index.
3. Looking at topics within the appropriate area, check to see if there is an existing policy that appears related or identical to the issue.
4. Turn to that policy and read it.
5. Ask yourselves, does the policy, as written, address this issue?
a. If so, ask yourselves, given new information, have we said enough or do we need to say more? This could result in changing how the current level of policy is stated or in adding one or more additional levels of policy below the existing one.
b. If not, ask yourselves if the issue represents something important enough to develop a policy on?
6. Any new policies follow the process outlined in the section above.