Building communication capacity – is a Babel fish the answer?
By Flora Gilkison, DM, ACIS, Chartered Secretaries New Zealand Inc
There are many opportunities for governance roles in New Zealand, covering the public sector (Crown entities, local body councils, district health boards, school boards of trustees), the private sector with family businesses, private and public companies, and the not-for-profit sector. All have board members who receive papers from managers about a range of activities the organisation is involved with and require a detailed knowledge of the business or organisation being governed. Each organisation should aim to communicate effectively between board members and managers.
Herein lies an issue for many directors, board members, and trustees: how to interpret accurately the management lexicon used in the papers written for board members to read every month or quarter.
A few examples from a range of board papers demonstrate the dilemma facing many willing but confused board members. District Health Board papers refer to CPHAC and DSAC, HEHA and TPOT. These acronyms are scattered liberally throughout the papers, and, for managers, demonstrate a common understanding and implicitly exhibit a common cultural bond. Not so for the board member, especially if just appointed. CPHAC is Community and Public Health Advisory Committee, a statutory committee, as is DSAC – Disability Support Advisory Committee. HEHA stands for Healthy Eating and Healthy Action – a Ministry of Health project, whereas TPOT is The Productive Operating Theatre, another project.
Health board papers are not the only reports which can cause confusion; school trustee papers also have their own lexicon with their own subtle, psychological message advising those who are in and those who are out. One of the first areas a new board trustee will be confronted with is NAG1 and NAG2 (National Achievement Guidelines; an Internet search is required, as the use of these acronyms is so embedded in education parlance that an initial explanation is not given).
When the financial reports of many organisations are prepared, it seems no other professional can match the CFOs (Chief Financial Officer) for their rabid use of acronyms. EBITs, EBIATs, ROI, GP, and NP abound.
Most board members will initially undergo a reasonably comprehensive induction where policies and procedures are explained, legislative requirements detailed, other board members met with, conflicts of interest explained, and some introduction to the material detailed as ‘the board papers’. There will be reminders of the behaviour expected of directors, the need to ensure plenty of time is set aside for prior reading of board papers, and the governance and management divide where board members are not to dip into operational areas, but to ensure they are the helicopter above, setting and guiding the strategy.
These aspects are all valid, but once the new board member settles into the role, there is still often a gaping divide. Just what do some of the board papers actually mean? For many board members who are independent from the organisation, the plethora of management speak and acronyms, especially related to the management operational areas detailed in board papers, can be just plain confusing. Board papers are usually read at night, which means taking a note of all the management speak not understood to be raised at the board meeting. This can be tiresome for those in the know and embarrassing for the member trying to unravel what the many diagrams, charts, lists of numbers, project logjams, and swim lanes actually mean, and how they relate to strategy implementation, and whether the outputs being achieved will even bring about the desired outcomes.
Once having read the board papers prior to the meeting, the hapless board member, armed with the papers awash with coloured stickers to remind them of the points to be clarified, will find, when the Chair opens the agenda item at a management report, that the responsible manager will often say, “I’ll take my report as read, any questions?”. Neatly segueing away from questions regarding interpretation for clarification to one of ‘what next?’.
The notion being advocated is that all boards should have a compulsory independent communication member. An acknowledged universal translator, who can translate management speak for directors, and director speak on desired outcomes compared with outputs for managers. The answer is of course the Babel fish, first described in Doug Adams The Hitchhiker’s Guide to the Galaxy (1978). The Babel fish is bright yellow, very small, and feeds on brainwave energy to telepathically develop a matrix of interpretation. A Babel fish would not add a lot of cost to the governance budget, the CBA (whoops “Cost Benefit Analysis”, the Babel fish will quietly whisper in the director’s ear) would be very positive. The introduction of a compulsory Babel fish to a board would mean that if a director stuck one in their ear, anything said would be instantly understood in any form of language.
If a Babel fish is not appropriate for boards, then a better way of aligning management reports for board papers must be adopted, one where each board report gives a rationale on why the information has been chosen, how the outputs detailed in the report affect the strategic outcomes, and what other interrelationships there are. One way forward is to develop a four-column dashboard explanation. This would ensure both sides, governors and managers, are quite clear about why the activities are being conducted and the information is being collected.
As an example, detail from a District Health Board perspective on Patient Activity is described. The information may include a one-page summary chart which details: Total Patient Discharge Numbers, Elective Surgical Discharge, Occupied Bed Days, Emergency Department Attendance and Waiting Times, Outpatient Attendance, Operating Theatre visits, and the number of births. This summary data can give a full picture from which board members can determine trend information aligned with ‘best practice’ data, effective resource use, and where necessary, can redirect resources to better achieve the critical success outcomes, all within a fixed budget.
In summary, board members should ensure that communication capacity is built through considered communication to managers of what standards are expected. With boards where independent board members are not expected to intrinsically understand the lexicon, then the usual standard of writing the acronyms out in full initially with the initials bracketed afterwards should always be done, eg Cost Benefit Analysis (CBA). In the rest of the paper, the initials only may be used, but the reader will always have a point of reference.
Board papers are a two-way communication process, and it is equally important for board members to have clearly enunciated to their managers what their expectations are. Just as important is for managers to understand what level of reporting detail is required and how the linkage to strategic outcomes can best be achieved.
Otherwise we may all have to revert to the Babel fish.
The contributions from CSNZ members and guests are the opinions of the authors and content is not necessarily a statement of CSNZ policy.
NZLawyer \\ issue 181 \\ 5 April 2012