Strategic governance for an organisation is the foundation for success and longevity. Strategic governance is synonymous with strategic leadership. Such leadership is an objective of all successful organisations – demonstrating authority, transparency, accountability and robust stewardship.
Strategic governance with a carefully planned strategic plan allows the organisation to generate the future success of the business – and not to just wait for and react to arbitrary conditions as the future presents itself. Of course, planning for the future can be neither perfect nor precise, as it is, by definition, a prediction based upon best-knowledge factors.
Good Governance supports the organisation and helps in the achievement of objectives.
Poor Governance can result in the decline or even demise of the organisation.
A feature common to successful organisations is that they have a well-planned strategic plan and adopt a planning cycle, which is expected to present predictable future features and successes.
Such a plan demonstrates precise strategic governance and is the task of the board. The board must develop, implement, and monitor the strategic plan, by utilizing input from all relevant sources, including stakeholders and management. The board must provide the necessary guidance and direction in the process.
Significant practices of strategic governance:
• Ensuring the board have sound strategic governance that upholds the vision, mission, and values of the organisation.
• Ensuring that all board members are aware of their responsibility to each other as well as the organisation as a whole.
• The strategic plan is the lifeblood of the organisation and so it must be a guide for the board, management and all stakeholders.
• Support the stated goals and results within the strategic plan.
• Establish clear policies and processes to set the direction of the strategy.
What components should a good governance model have?
• Board responsibility and oversight: Is determined with a strong vision. The board must articulate the process of oversight, understand and share that vision with all concerned, and implement it.
• Committees with responsibility: The work and authority of board-appointed committees must allow them to fulfil their responsibilities and fully report efforts to the board and management.
• Strategic plan: Clearly identifies the organisation’s direction and goals. It must be reviewed regularly and modified when necessary by the board.
• Business plan: A detailed document created to formalize the strategic plan. The business plan stipulates the board’s broad goals.
• Policies & procedures: Guiding principles to set the direction of the strategy. Along with processes that are broken down into activities.
• Mission statement: Recognizes the aims and values of the organisation.
• Strategic goals: The strategic future of the organisation as set by its’ strategic governance.
• Values: Principles and values of the organisation.
• Vision: Defines and recognizes the aspirations of the organisation.
A robust principle of strategic Governance requires the board to provide excellence in leadership by applying vision, authority, transparency, accountability, planning and stewardship. This will sustain the organisation well into the future.