Avoiding Board Burnout: Dashboards Deliver the Antidote to TMI

In the absence of time, we err toward an abundance of information. Quoting a French philosopher who said, “If I had more time, I would have written a shorter letter,” a recent article in Associations Now illustrates the irony of packing all available information into a report and hoping its readers have the capacity to sort through it. This is just one of the ways to cause board member burnout.

While the article first caught our eye for its relevance to one of our market segments, it actually is relevant to all organizations, regardless of size or industry. Obviously, boards can’t excel in financial oversight if board members can’t read – or interpret…or even find – the numbers!

The article suggests that small association boards, often responsible for making financial decisions, are especially vulnerable to board member burnout. These boards (like many) are dependent on time-starved staff to produce financial reports that can be overwhelmed by excess data, yet board members hesitate to reveal their confusion.

Research shows the majority of associations with over $10M in reserves have dedicated committees to oversee investments, while less than half of small organizations (under $1M) have investment committees. The leadership and/or boards of these small organizations then bear added responsibility for determining investment strategies with or without the financial expertise they need.

The result, finds the article, is a drift in focus. When finances are in good shape, boards tend to tune out, only to be jolted back to attention by an economic downturn. To avoid the drift, some boards aim to enhance their financial knowledge and investment strategies. Boards also need reports that are “clear, concise, and actually penetrating the consciousness of (those) charged to act on the information they contain.”

As noted, too many boards don’t readily acknowledge their financial ignorance, nor do they understand the level of liability it fosters. Given recent headlines about financial oversight failings in large institutions, the potential for board vulnerability is universal. Also widespread is discussion about the importance of consistent metrics for measuring outcomes and success. At BE, we talk about it both for our company and our clients.

Thus we segue to another timely article, published in Forbes, which explores why – and how — financial dashboards can make a difference.

Though most organizations produce (lengthy) financial reports, many boards do not act upon or even understand them. As noted by a financial management firm, graphs and visuals in financial analysis promote storytelling and “interaction with the numbers.” By highlighting variances, management can explore trends — as well as necessary action — with board members.

Given the diversity of experience and perspective around the nonprofit board table, dashboards level the playing field in terms of financial understanding and engagement. As the article suggests, even the process of generating the dashboard itself can be helpful, as it fosters clarity around definitions and metrics of success.

To that end, Forbes offers some practical tips for creating a dashboard:

  • Convene a diverse working group to identify critical benchmarks of success.
  • Measure performance against target outcomes.
  • Pilot the dashboard for a specific period, then assess and revise.
  • Build a dashboard you can easily maintain.

As boards increasingly recognize their accountability and vulnerability in financial management, the use of dashboards is becoming “best practice” among nonprofit leaders.  A sample dashboard, developed by CompassPoint and included in the Forbes article, illustrates the kind of information board members should seek – and ultimately find easily through board management software.

Seems boards, the sector, and our product development team are all on the same page.



Sonia J. Stamm

Sonia J. Stamm is Governance Consultant at BoardEffect. Since almost our inception, she has shared a best practice perspective on governance with our team and clients, partnering to guide boards toward optimal implementation of our software. As founder and principal of a nonprofit leadership consulting firm, Sonia supports the evolution of mission-based organizations through her work in board development, leadership transition and succession, and organizational effectiveness. A seasoned facilitator, trainer, and consultant, she enjoys guiding boards and organizations through critical junctures in their development.