Urban 'C.E.O.'s': Untangling the Governance Knot
Suppose you know a successful chief executive officer of a small to medium-sized company. He is well paid, but you know he has the talent to go on to a more challenging position. You know he could do better financially as well.
Now suppose further that "Headhunter" came to him and offered him the position of CEO of a bigger firm with lots more money and benefits. But the firm is in deep trouble.
Headhunter doesn't want someone who is looking for a job. He's looking for someone who is very successful, happy, and undervalued where he is. This position is the bigger challenge your friend is seeking. Profits and productivity are down and expenses are high. Foreign competitors are producing better-quality output at less cost.
Your friend is confident because he knows how to turn the company around. He has done it before. He has even done it in this industry. What an opportunity!
"How about the board of directors?" he asks.
"Fine people!" says Headhunter. "They know nothing of managing your industry but they are fine people."
"That's O.K.," your friend says. "They are more likely to stay out of my hair and let me make the tough decisions that have to be made."
"Well, it's not quite that way." Headhunter's voice drops. It's barely audible.
"What do you mean?"
"They meet rather often."
"The board or one of its subcommittees meets on average once a week. Sometimes more."
"Are you kidding?" he says. "My board meets once every three months! What do they do?"
"Well, here is a regular agenda. They consider and approve all of this." Headhunter hands him an agenda about an inch thick. It's full of detail on appointments of professional staff, aides, vehicle drivers, and secretaries. There are many awards for supply contracts. "Much of their time is spent discussing these kind of issues. They rarely discuss the bottom line," Headhunter says, while gazing at his shoes.
Your friend glances disbelieving through the agenda. "About how much of the CEO's time is spent on this board? I mean, how much of his time is spent in meetings, preparation, follow-up, persuading board members?" There is a touch of irritation in your friend's voice now.
"Sixty to 90 percent of the time," Headhunter responds quietly.
"You are wasting my time!" Your friend is clearly disgusted. "Bring me a deal where the board really wants someone to lead a company out of trouble. This company is doomed. What they want is an executive secretary to preside over its burial."
The company in question, an urban school system, may indeed be doomed, along with its whole industry, urban public education. There are a great many of us who have spent a lifetime working in public education who believe that at the very least, it is doomed in its present form. School boards spend little time focusing on the "bottom line"--academic performance--while concerning themselves with unbelievably detailed administrative issues related to how the system is run and, very often, who gets jobs. In most cases, you can add to this process a heavy dose of pure, energy-draining politics. Some of it is overt, some very subtle. But the result is that neither the superintendent nor the board gives appropriate attention to priority educational goals and performance assessment.
There is no one, single problem draining the effectiveness of public school systems, but a whole host of interrelated ones, from the relatively short length of the school year to the weakening of the family structure. As we address the problem in its totality, though, we need to carefully examine the major barriers to progress that relate to governance and to the position of school-system leader.
In Tsukuba, Japan, the superintendent of elementary and junior-high schools is appointed by the mayor, as is his board of education. That board is mainly advisory and is made up of respected, retired educators and sometimes other professionals. It meets about once a month. A similar structure exists at the prefecture (state-county) level for high schools in Japan. The board of directors of a nationally respected, private secondary school in Tsukuba meets once every four months.
The point is that much less time, effort, and attention of the these Japanese school administrators is taken up with preparing for, attending, and following up on meetings, with communicating with members individually and collectively, and with the political process generally than is the case in the United States, particularly in urban districts.
In our experience, between 60 and 90 percent of urban U.S. superintendents' time is taken up with these matters. In addition, we have observed a "multiplier effect" on members of the administrative staff, both in terms of the proportion of their time spent responding to board requirements and in an increased number of administrators. Use of the categorical-grant strategy by the states and federal agencies adds to the administrative workload. State and federal legislators and governors who correctly point an accusing finger at administratively overstaffed school systems should accept much of the blame for this state of affairs. Restrictive grants and excessive paper requirements emanate from their laws and regulations. The result is more administrators.
To address these issues, we make five modest proposals in the form of the following recommendations:
- The superintendent must be given the job of chief executive officer if he or she is to be held accountable with the professional staff for academic results. Right now, no one can tell who is accountable because the leadership, managerial, and administrative-policy roles are so mixed up between the board and superintendent. For example, personnel appointments, promotions, demotions, and separations--as well as service, supply, and equipment contracts--should be totally in the domain of the superintendent.
The major argument against this position is that this will lead to an educational dictatorship. Our assumption is that the board in its strategy will not want to create a central-office dictator, but will want to create energetic, effective schools with accountable principals and faculties as the means to effect change. That will be a stated criterion for the position. If the superintendent is to share power to effect this end, he has to have it to share.
- The board, including its subcommittees, should cut way back on the number of meetings. There should be no more than one regular meeting a month and no subcommittees except financial audit and academic/organizational performance audit. That kind of redefinition of the roles will allow for a significant reduction of meetings and board activity, particularly administrative and political activity. It will also increase productive time spent on the "bottom line." Board members should never be paid by the number of meetings they have. The reverse would be better.
The main argument against this is that the people need to be able to reach their elected representatives easily and that the board should "know what is going on" and be "responsive." The assumption is that the present arrangements achieve this end. In fact, they do not. Academically, by our observation, boards do not know what is going on because 90 to 99 percent of their time is spent on administrative matters.
- The superintendent should have an ombusdman capability to deal with day-to-day matters of concern to parents, citizens, and constituents of members of the board. Most of these matters should be dealt with at the school level. In Tsukuba, Japan, for example, principals say most are dealt with at the classroom level.
When you have a problem with your Ford or Toyota you do not go directly to the company board of directors. The board's job is to choose a president who will, among other things, set up company capabilities to address problems close to the customer. So should school systems. Clearly, important and systemic problems should be dealt with by the board in their goal-and-strategy sessions focused on improving the effectiveness of the organization.
- Boards should be as representative as possible of the racial and ethnic composition of the population they serve. They should include parents, but should be dominated by successful professional, business, and labor leaders, each of whom brings strengths in such areas as organizational leadership, planning, finance, business, law, education, and the like. They should be appointed by a designated, elected official or officials through a nonpartisan-panel nominating process that must meet the above requirements in the slate of nominees. Board members should be barred from political office for five years after serving.
The rationale for proposing an appointed, nonpartisan, representative board is to reduce the level of political and administrative activity and increase the level of knowledgeable, productive, goal-oriented work.
- The board's major responsibilities should be the following:
Selection, assessment, and retention of the superintendent. These are the key tasks: obtaining the best possible executive, maintaining working conditions that assure success, assessing performance, and making it worthwhile for him or her to stay (or not to stay in some cases). Board members that vote for a failure should resign because they have failed at a primary responsibility.
Before selecting a superintendent, the board should participate in a process that results in a clear definition of what it wants accomplished and why. Not how, but what and why. The selection process should in part include listening to superintendent candidates respond to how they would accomplish the board's goals.
The more that the board can do to define what it wants before selection, the more likely it is to obtain a superintendent who will succeed. The board should do everything possible to avoid an election or a definition of goals by a one-vote majority. A clear definition and consensus should be the basis for a fair and rational performance-assessment process. A third party should also assess the board's role in achieving (or not achieving) progress.
Broad policy: comprehensive educational strategy. The board should review, assess, and adopt broad policy recommended by the superintendent. There should be retreats to discuss informally broad directions of the system. The result should be a high degree of consensus within the board and between the board and superintendent, resulting in a clear mandate.
The superintendent should prepare with the staff a comprehensive strategy as to how major goals such as improved academic performance, college placement, and job placement will be achieved. This should be followed by a comprehensive implementation plan with dates and a reporting system on "indicators of success." Detailed plans with target dates and named responsible administrators should be the superintendent's concern, shared with the board for review and comment but not for approval. The comprehensive plan should be reviewed and commented on at a retreat, but the board should be slow to substitute its judgment.
Acquiring and allocating resources. If the school system lacks essential financial resources, it is up to the board, not the superintendent, to take the primary initiative. The superintendent can help, but his or her time should be preserved as much as possible for substantive, education-related matters. In a broad sense, the strategy and comprehensive plan should define the policy elements of the budget allocations.
The board should not substitute its judgment for the superintendent's in matters of detailed school and program budgetary allocations. The reason is that the board may thereby destroy the accountability of the superintendent and professional staff for academic and organizational results. The board should set the appropriation and appropriate funds to broad financial policy and programmatic categories. It should not appropriate to detailed administrative categories.
Program assessment and reporting. The board should expect in-depth assessments every 6 to 12 months of selected, priority programs identified in the strategy and plan, as well as annual reports on progress toward other goals of the comprehensive plan. These data and the supporting information are the equivalent of the "bottom line" of a private corporation. The reports should contain measurable indicators that reflect both the quality of the process and outcomes. Reports should be subject to an internal audit process.
Statutory requirements and restrictions. In the real world, the board must do certain things by statute or state regulation. These are mandates that in the short term must be addressed. But boards should take a leadership role in getting the state to reduce or otherwise modify these.
Many of the state and federal financial restrictions are counterproductive. As a result of state financial rules, one district we know of is hiring 180 more bus aides this year, while it may have to lay off teachers it needs next year (keeping the aides). Federal agencies are already moving to reduced constraints on the planning and use of categorical funding. Chapter 1, special education, remedial education, and "at risk" state funding all overlap in their purposes and clientele. They should be planned and budgeted together, along with general-fund contributions.
Complex and restrictive state and federal grant-funding practices result in distorted planning processes, with much time being spent on very small parts of the program and budget and relatively much less time on comprehensive, systemwide planning and budgeting. Aid is given out by the states and the federal government in small, restricted pieces so that about 90 percent of the planning goes into 10 percent of the resources. The result is that no one has sufficient time for the whole.
In most states, the school budgeting, accounting, and reporting systems are constructed for the needs of state department of education and state auditors, rather than the people who actually plan and operate the schools. The result is that although technically it is possible to add and use financial categories like "mathematics" and "kindergarten," it just is not done in most places. The financial specialists at the state and district levels conspire to maintain the status quo, because it is easier than developing a system that responds to a school- and program-based approach.
In the United States generally, when one adds the impact of the managerial role of boards and committees to board politics and the complexity of the categorical state and federal requirements, it is no wonder that we have the most administrators and the worst educational results of the developed countries. It is probably not the competence of the administrators that is the central problem. They are probably no better or worse than those found in other countries. It is the basic structural characteristics and requirements designed into the system by governors and state legislatures.
No competent and successful CEO would accept the leadership of a company in the private sector if the board of directors were going to meet once a week to consider and decide upon administrative matters, while the "bottom line"--in this case academic performance--was largely ignored.
The means of achieving these suggested reforms could be statewide or local-option legislation approved by boards themselves or by voter referendum. Even without legislation, a board could by itself make significant progress in reforming its governing policies and practices. To do so, it would have to lay the groundwork carefully with the public.
"What are you going to do?" Headhunter asks.
"I think I'll accept a job at Harvard to work on the roots of the problem," your friend says.
And so he did.
Vol. 10, Issue 25, Pages 38, 40Published in Print: March 13, 1991, as Urban 'C.E.O.'s': Untangling the Governance Knot