Director Coaching

An argument for considering alternatives to federated board structures.

By: Dale Simpson

Federations have long been a cornerstone of the structure of many non-profit organisations in Australia. This form of organisation is loosely based on the Australian Federal system of government, which brings together state and territory governments with the Australian Government providing overall leadership on areas of national interest. The aim of this model is to facilitate better coordination between different levels of governance and to ensure that decisions are taken at the most appropriate level.

This traditional federated structure is considered by many to be increasingly outdated. The changing world may require greater adaptability and flexibility than can be achieved within a federated structure.  In terms of responding quickly to change and delivering services across multiple jurisdictions other structures may be more appropriate. This thinking has led many organisations to look for alternative governance systems that better serve members and the communities they serve.

In response, some organisations have adopted a ‘virtual’ model of national coordination. This approach relies on the use of new technologies and innovative ways of working to facilitate collaboration between different parts of the organisation without having to establish a formal structure. This has enabled them to respond quickly and effectively to emerging issues while maintaining strong connections between the different levels of the organisation.

Some groups whilst maintaining a centralised governance model are exploring supporting operating models that focus more on outcomes than structure, such as collective impact initiatives and social innovation collaborations. These approaches are geared towards developing innovative solutions to complex social issues, often through cross-sector partnerships.

It could be argued that national non-profit organisations need to consider alternatives to traditional federated models and embrace new approaches if they are to remain relevant and better serve their members and communities. Organisations should look for new ways of working and explore innovative models that allow them to be more agile, collaborative and creative.  I would be interested in your views and thoughts on this position.

In the age of globalisation and digitisation, the traditional State-based structures of many Australian not-for-profits is becoming increasingly challenging. While locally elected/appointed representatives may be closer to the needs of their members and local communities, they are often unable to deliver on the bigger-picture vision and perspective necessary for running a successful national organisation. Let’s face it, the closer to the coal face you are, the more operational you become.  

Some would say that it is possible to maintain a federated structure, if the conflict between State-level and National interests are managed carefully with understanding. This requires a high level of emotional intelligence by all directors.  My view is that this is rarely achieved.  I would be delighted to hear from others about where this has worked.  See our previous article on Fragmented Boards

It can also be difficult to make large-scale changes to the governance of a federated group as usually it requires agreement from all the State members.  The result is that changes at best are incremental and often outpaced by the changing needs of members and communities.  I am imagining that this will have resonance with some of you whilst reading this 😊.

Making the transition from a traditional federated board structure to a more unified and streamlined governance model can be challenging for most organisations. It requires careful planning, foresight, and leadership that is willing to embrace change. The purpose of this article is to open this up for wider debate.  There are two ideas I would like to proffer on how organisations may make this type of transition as a means of improving overall organisational effectiveness and relevance. 

One idea is for organisations to create an Advisory Board composed of members from each state being served by the organisation. This advisory board would establish a regular cadence for meeting and provide input into strategy and decision-making.  I’d suggest that this may increase participation at a higher level than what was previously available within the federated board structure.  Again, I am happy if you have an alternate view on this. Having representatives from across the organisation involved in making decisions helps to ensure that all perspectives are considered when making important decisions affecting direction and intent. Additionally, having an advisory board may allow for better communication between states resulting in improved collaboration and efficiency throughout the organisation.

The second idea cold be that organisations can transition away from a federated structure by creating cross-functional teams tasked with specific projects or initiatives related to organisational goals. Such teams should be representative of all states working together to achieve common objectives whilst learning about other areas of expertise across the organisation and its territories. This most likely would drive greater innovation and create more sustainable futures. It should encourage an increase in collaboration between jurisdictions and help break down silos, prevent progress in certain areas and unnecessary duplication.

My argument is that organisations should consider the benefits of moving from traditional federated models and embrace new and more relevant approaches to serving their members and communities. Creating Advisory Boards composed of members from each jurisdiction, division or department as well as establishing cross-functional teams tasked with specific projects or initiatives related to organisational goals, organisations can drive innovation and create a more sustainable future. Ultimately a shift towards modern more agile structures can help non-profit organisations stay ahead of the curve, while also allowing them to provide services efficiently across multiple jurisdictions.

I would greatly value your insights and disagreement.  If you liked this article, feel free to share it and repost it with your network.

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