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The first post in our Integrative Governance™ blog series

Governance:
Your Organization's Navigation System


A few short years ago, most organizations and institutions had a risk and operating profile much like a locomotive. Non-global reach, relatively low-technology, low regulatory impact, and not affected by social media. There was inherent safety from the “rails”, but they also limited what the organization could do and where it could go. In recent years, many if not most organizations and institutions have evolved to the risk and operating profile of an airplane – global reach, high-tech, greater regulatory impact, and the need to be responsive to new dynamics introduced by a social media driven world. As we know, the required sophistication and integration of the navigation system for an airplane is significantly higher than that needed to operate a locomotive. Generally speaking, there has been a somewhat dangerous lag between the pace of change in today’s organizations versus the pace of change in the navigation (governing) system needed to keep up and safely navigate the enterprise.

"In recent years, many if not most organizations and institutions have evolved to the risk and operating profile of an airplane – global reach, high-tech, greater regulatory impact, and the need to be responsive to new dynamics introduced by a social media driven world."

Shortfalls in navigation capability for speed, precision and agility – sometimes deadly ones – have been much more prevalent in today’s environment than have ever been seen before. This has resulted in much higher levels of financial instability, breakdowns in stakeholder trust levels, and weakening ability to innovate and grow profitably. What’s more, while the “locomotive” to “airplane” gap is still being felt, some organizations and industries are already moving from “airplane” to “rocket ship” – totally new business frontiers and operating models, leading edge technology innovation, a potentially volatile regulatory impact, and the need to actively leverage the “social revolution” dynamics to drive the business and its strategy forward. The governance gap continues to grow.

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The full view and understanding of an organization’s governance as its navigation system and steering mechanism is an important context within today’s business and institutional realities. These realities, such as the economic environment, a global marketplace, technology advancements, social media proliferation, and growing regulatory mandates, are creating a once-in-a-generation level of “make or break” risks and opportunities. There is much at stake for all organizations, from the smallest of non-profits to the largest of public corporations. The way business leaders navigate today’s accelerating market forces (using their organization’s navigation system) ultimately determines success – and the ability to innovate, grow and be profitable. For many organizations, we are even talking about the ability to survive in this new, challenging environment.

Why is this a critical and urgent issue for all leaders? Because the complexity of today’s market environment AND the growing sophistication of today’s organizations demands a more integrated navigation (governing) system. Why? Because navigational speed, precision and agility are needed at higher and higher levels than ever before to thrive and win. If you think about it, this is actually true of anything that needs to be navigated. The more sophisticated the vessel, and the more complex the navigating environment, the more integrated the navigation system needs to be to ensure safe travel and successful arrival at the desired destination.

In this context, the strategic and executional importance and impact of governance for an organization comes into full view. Governance, at its essence, is:

  • • The allocation of decision-making power (governing roles)…

  • • To allow the proper exercise of that decision-making power (governing system)…

  • • To achieve an organizational mission/purpose (governing duties).

"Why is this a critical and urgent issue for all leaders? Because the complexity of today's market environment and the growing sophistication of today's organizations demand a more integrated navigation (governing) system."

There are two questions all organizations and their leaders should always be asking and challenging themselves with: “Does our organization have the “navigation (governing) system” to allow us to confidently navigate these new and increasingly challenging market forces with the speed, precision and agility to win?”, and, “How do we know?”.

Yesterday’s “locomotives” simply needed strong individual navigation (governance) components. Today’s “airplanes” require a truly integrative navigation (governance) system, which many have still not yet achieved. Tomorrow’s “rocket ships” will require predictive navigation (governance) informatics, which are still out of reach as of today.

The second post in our Integrative Governance™ blog series – entitled: “The Dawn of Integrative Governance – The Next Generation Standard” – will take us deeper into solving the governance gap we see today through a new standard of governance capability and excellence. Stay tuned.

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