Avoiding Post-Expansion Burnout: The board of directors' role

More than half of our food co-ops have engaged in planning and implementing an expansion project during the past three years. As demanding as these projects can be, the real challenge begins when the co-op opens its doors in the expanded store. An earlier article by Carolee Colter (CG #116, Jan.–Feb. 2005) described the challenges of post-expansion burnout, primarily from the perspective of management and staff. This article will focus on the role of the board of directors in the first year after an expansion.

How can the board of directors best provide appropriate leadership following an expansion project? How can the board help prevent post-expansion burnout—both at the board level and at the management/staff level? How can the board best maintain its accountability to the members while also holding the general manager accountable?

Once the co-op has opened in its expanded space, a board of directors that has provided effective leadership and done its job throughout the planning and implementation of their co-op’s expansion project may be at a loss concerning what to do next. After two or three years of intensive planning work, how can the board shift its focus as the co-op enters a period of even greater challenge? What should that new focus be?

Accountability

Accountability for the board includes three aspects:

• accountability to the members for the overall performance of the cooperative;

• accountability to each other for providing leadership, group discipline, and self-responsibility; and

• ensuring general manager accountability by rigorously monitoring pre-established criteria (policy).

A board needs a clear, organized, and integrated system and plan in order to achieve such accountability. Ideally, these systems will have been established well before the expansion and simply need to be fine-tuned and reinvigorated.

In discussing how a co-op board can develop and sustain a system of accountability, we will examine three important ingredients: commitment, focus, and support. We’ll begin by looking at the commitment level of individual board members.

Commitment

Being a board member of a food co-op is basically a volunteer position of service to the cooperative and community. Boards of co-ops, as in many mission-driven organizations, are lay boards composed of nonprofessionals. For example, food co-op boards are usually not composed of grocery professionals. A board member may have committed to a two- or three-year term and found much of it consumed by an exhausting, high-stress roller coaster ride through an expansion project. Perhaps more time and expertise were required of that board member than she/he expected.

Now that board member may be thinking that she/he has done enough and that it will be a good time to resign from the board once the co-op has made it through the first few months in the expanded store. Or maybe the director won’t consider a second or third term. Losing effective board members at this critical time can create higher stress for both management and the board.

To avoid high board turnover during or soon after an expansion project, it is helpful if the board does some internal planning and team building at the onset of an expansion project, encouraging a length of service of at least six years for those who can be effective board members. This expectation/vision should be communicated through the board recruitment process as well. With the increasing size and complexity of our food co-ops both as businesses and organizations, the first year or term for board members is primarily a time for learning their roles and developing as effective leaders.

An experienced and effective board of directors is best able to transition into an appropriate role that leads and supports the organization during the critical window of one to three years following an expansion project. I recommend that board members have informal conversations with one another to discuss the nature of their commitment and to assess their individual and group effectiveness. Verbal contracts and a stronger team can emerge from these conversations. For example: “Yes, I can commit to seeking an additional term on our board. If elected, my primary contributions would be in the areas of oversight and assessment. I would not be able to continue to be an officer, so perhaps we can find another qualified board member to take on that role.”

With intention, board members should seek a service experience that is both meaningful and fun. Without that, it will be difficult to sustain an effective leadership team at the board level. The ripple effect caused by a weak and inexperienced board has high impact on management’s pursuit of success for the expanded cooperative.

Focus

Following an expansion project, the board will need to shift its focus. The question is, what do they shift it to? The core components of the board’s job description continue as they were in the past: LEAD—Link with members, Enact effective policy, Assure performance, and Dream the future. The board’s oversight responsibilities (monitor and assess) will increase, and it is essential that the board continue to provide clear direction to management through policy. While these primary board responsibilities existed prior to and during the expansion project, the texture is shifting. The board will need to feel its way into the new era, modeling and setting the tone for effective leadership and teamwork throughout the organization.

After the opening of an expanded store, it will be four to eight months before significant financial measurement can be realized. However, having systems in place for early monitoring of both sales and labor expense/productivity (by department) and cash flow is extremely important. The board will need to be careful not to micromanage, instead giving management the space and support needed to do the job at this critical time while still requiring key quarterly monitoring reports (and perhaps some monthly updates). Reports should include comparison to projections. Through policy creation and policy monitoring, the board needs to be assured that adequate financial and accounting systems are in place to create timely and accurate financial reports.

Post-expansion monitoring reports should focus not only on new store performance; there also should be a summary report on the total project costs compared to projections. Often this is the last management report on an expansion policy. Such a report will help define the level of working capital available as the co-op begins operations in an expanded store. The board needs to know whether any or all of the working capital for the first year has been used up by project overruns since the working capital is essential to covering a certain level of planned operating losses. If there is adequate working capital, management will have a more reasonable time in which to build profitability.

In addition to assessing and monitoring current performance, the job of a board following an expansion project is to continue to focus on the future—how to best serve and meet members’ needs. Focusing on the future might involve a board retreat or a retreat of the leadership group (board and management) towards the end of the first year following expansion. Such a planning retreat could focus on continuing to build a shared vision for the future and reviewing the ends/mission of the co-op. Review of the ends policy is often needed after a completed expansion.

Building a shared vision for the future of the cooperative is an ongoing process. With a recently expanded cooperative, there is tangible evidence of what can come from dreams and visioning. This evidence can provide fuel and inspiration for the next chapters of the dream.

Support

While the board needs to hold management accountable to an agreed upon level of performance, the board also needs to find effective ways to provide support to management, especially during the early years in a newly expanded store (or stores). In order to illustrate how the board might best provide support to management, we will list some post-expansion board actions that result in the opposite of management support: increased stress and a heavier workload for management.

• A high level of board turnover results in a new board of unknown directions and expectations.

• Individual board members or the board as a whole allow end runs by staff around management, undermining management’s effort to build accountability within the store.

• The board attempts to mollify staff conflicts resulting from changes in the workplace and its culture.

• Excessive requirements are established by the board for management reporting.

• Interference and micromanagement are practiced by the board.

• The board creates issues that are crisis-oriented rather than directing concerns within the framework of policy.

• The management evaluation process is non-existent or late.

• The manager experiences a lack of clear direction from the board, including conflicting lists of goals and measures of success, outdated or incomplete policy, and inconsistent application of governance principles and policies.

• The board demonstrates lack of leadership, ongoing recruitment, and regular training.

• There are unresolved conflicts within the board or conflicts between board and management, and the board does not speak with one voice to management.

• There is a lack of regular formal and informal communication between board and management.

• The board ignores its own process, housekeeping, and member linkage responsibilities.

• There is lack of support for continuing with co-op networking, collaboration, and training opportunities.

The board that can intentionally provide strong support to management while holding management accountable will be laying the foundation within the co-op’s culture for strong systems of governance, management, and planning that will potentially sustain service to future generations of cooperators. In developing accountability, individual and group commitment, focus, and a shared vision, there is much that a board can do to assist the co-op and support management at an especially vulnerable time and to help minimize post-expansion trauma and burn-out. The positive energy and momentum that results from a successful co-op expansion project can become deeply imbedded in the co-op’s culture and serve as part of the foundation and fabric for future growth and success.