>I have vivid memories of a wonderful keynote >speech at the TRAIN conference a few years back >given by the exec director of Colonial >Williamsburg who explained in clear and >unambiguous terms that his board only existed >for one reason - to go out and get resources for >the museum.

Perhaps that was a little hyperbole on the speaker's part (or wishful thinking)and while a good fundraising board is certainly a great asset-that statement is (there's no way to be diplomatic) dead wrong.

Boards of Directors, whether in the for-profit or non-profit sector are and charged under law with ensuring the financial, organizational and legal health of an organization. As such they are the key to a succesful future or the assurance of its demise.

I believe it was Rypn's predecessor-Locomotve and Railway Preservation that had an article on how in the late 30's Baldwin management was repeated and publicly stating steam was here to stay.

BLW's board caught wind of this and replaced the executive team. (which in the 30's meant high drama-firing long-time employees and creating the whiff of instability and scandal in the financial press).

Whether this was a prompt action that ensured Baldwin's survival for another 20 years or too late to allow entry into the diesel market to be an effective competitor is probably complicated enough to be the subject of a good doctoral dissertation. It is clear however that management was off-course and had they been allowed to continue dismissing diesels-Baldwin would have been a dead duck in 5 to ten years as steam orders were effectively dead adter World War II.

Boards are in many ways like trustees-required to oversee that their organizations are effective, financially sound, legal and operated for the exclusive benefit of their beneficiaries (purpose). If they fail to do these duties- they can be prosecuted.

Although we seem to be going through a period of board laxity-largely caused by the lack of engaged, dispassionate outsiders willing to challenge management-the likely effect of the sure-to-come shareholder class action lawsuits against the boards of the Enrons and Global Crossing's will be more vigorous enforcement of existing corporate laws.

It is true that State Attorneys General don't like to pursue actions against non-profits and that there is some protection afforded volunteer directorates by numerous states' "volunteer immunity" statutes-but those individuals that think their only job is fundraising risk the continuity and health of the organizations they serve and perhaps own legal future as well.



Superheater@beer.com

> Perhaps that was a little hyperbole on the
> speaker's part (or wishful thinking)and
> while a good fundraising board is certainly
> a great asset-that statement is (there's no
> way to be diplomatic) dead wrong.

Needless to say, there are going to be those of us who do not agree with this.

Obviously, a board--under the non-profit corporation code of the state of incorporation--is charged with the overall governance of the museum.

In most cases, the hands-on work is trusted to an executive director and a team of seasoned professionals, including both volunteers.

The prime difference between a for-profit and a not-for-profit board is obviously the lack of ownership on the part of not-for-profit board members. For-profit board members use their stock-voting-power and knowledge to increase their own wealth; not-for-profit board members use their friendships/associations/wealth to increase the value and prestige of the organization they serve.

Not-for-profit board members do provide more than fund-raising assistance. They provide expert advice in legal, business strategy, fiscal planning, and a wide variety of subject areas.

But, when it comes down to it, few of them are put on the board to actually run the business. They not only do not know how to run the business from a hands-on perspective, they do not care about it in that way. They are there because they believe in the mission and want to see it succeed and they are there because of the prestige they get in being associated with it and they are there because those who put them there think their status a community mover and shaker will grease the wheels of fund-raising, publicity, government interaction, etc. If they try to run the business directly, they are out of line and are sabotaging the authority of the executive director and others who have the knowledge and experience to run it properly.

--Malcolm

malcolmrcampbell@cs.com

> Not-for-profit board members do provide more
> than fund-raising assistance. They provide
> expert advice in legal, business strategy,
> fiscal planning, and a wide variety of
> subject areas.

Who says board members are necessarily charged with fund-raising? I think that is determined by the constitution and agreement of the organization's members. In some cases, fund-raising may be the duty of officers or staff.
In general, the board is to establish policy and goals and ensure those are being met by whomever is charged with individual responsibilities.

denmeg_hogan@msn.com

> Needless to say, there are going to be those
> of us who do not agree with this.

You may disagree but the fact remains that corporate boards are subject to the domiciling state law regarding corporations and that law requires boards to do more than fundraising.

Obviously, a board--under the non-profit
> corporation code of the state of
> incorporation--is charged with the overall
> governance of the museum.

That is true. I don't disagree. That overall governance includes reviewing policies, budgets and other operational guideposts and insisting on regular accountability from management.

> In most cases, the hands-on work is trusted
> to an executive director and a team of
> seasoned professionals, including both
> volunteers.

That is also certainly true. Whether it is wise or effective is my point of contention. In many places the E.D. probably does prop up a weak board(the day he/she realizes that-you've got a problem) To quote the old Russian proverb "trust, but verify". Even "seasoned professionals" make errors or even on occasion are guilty of mis or malfeasance.

> The prime difference between a for-profit
> and a not-for-profit board is obviously the
> lack of ownership on the part of
> not-for-profit board members.

Unfortunately, in the for-profit sector, the beneficial effects of significant personal investment in promoting vigilance on the part of management/directorates are often underlooked and in the non-profit sector are as you state-impossible. The difficulties this causes are so profound that it wasn't until 1993 that the Financial Accounting Standards Board was able issue statements on non-profit financial reporting.

>For-profit
> board members use their stock-voting-power
> and knowledge to increase their own wealth;
> not-for-profit board members use their
> friendships/associations/wealth to increase
> the value and prestige of the organization
> they serve.

For profit board members are supposed to increase the wealth of the corporation and as a result-their fellow shareholders' and their own wealth- currently publicized lapses not withstanding.

> Not-for-profit board members do provide more
> than fund-raising assistance. They provide
> expert advice in legal, business strategy,
> fiscal planning, and a wide variety of
> subject areas.

The post I was responding to explicitly stated otherwise-that their "only" purpose was fundraising-I think I'd agree with you here. I'd only add that the board employs those skills collectively in establishing policy, budgets,and in reviewing management's effectiveness and efficiency in meeting those goals/objective, they acting collectively establish. As a group they are authoritative, not merely advisory.

> But, when it comes down to it, few of them
> are put on the board to actually run the
> business. They not only do not know how to
> run the business from a hands-on
> perspective

The conclusion I draw there is a tragic waste of the "expert" talent you just cited. Certainly a board needs to weild its authority with discretion-to manage by exception

, they do not care about it in
> that way. They are there because they
> believe in the mission and want to see it
> succeed and they are there because of the
> prestige they get in being associated with
> it and they are there because those who put
> them there think their status a community
> mover and shaker will grease the wheels of
> fund-raising, publicity, government
> interaction, etc.

I've seen such organizations where the board "didn't care about it in that way" and many were misrun, one was dissolved. Anybody who has personal social enrichment as a primary goal is while commonplace, a potential source of a problem-who might choose a personal political viability over tough decisions.

>If they try to run the
> business directly, they are out of line and
> are sabotaging the authority of the
> executive director and others who have the
> knowledge and experience to run it properly.

Sir, I have to disagree. I have NEVER seen bylaws-and the internet and personal experience have allowed me to read scores-that don't explicitly state the officers/management serve at the pleasure of the board. The E.D.'s "authority" comes from the board. ED's or CEO's no matter how educated or professional are human beings-subject to all the foibles that a persistent lack of accountability can bring. As for professional management of non-profits, wasn't it about a year ago the story broke about the way 9/11 funds were going to be spent by a major charity-until the board acted?

I'm not suggesting that individual directors be interfering in day to day management, but they should (collectively) make the ED/CEO accountable in regular budgets, status reports, progress reports and financial statements.

If they are sitting back, not insisting on accountability and challenging management in an appropriate and discrete forum-they are "out of line" and not responsible stewards of the responsibility they FREELY accepted-no matter how commonplace the practice.

Without reigniting a recent flamewar, didn't we just have a huge discussion on here about a high-profile museum that was nearing financial insolvency until a new board was installed and took over the reins?

Now obviously, this is a lot of textbook idealism. I've seen many posts on here discussing the efficiency/effectiveness of this organization or that organization. Perhaps if we, as members, insisted universally on boards that were alert,competent,dedicated and engaged, we be having more success in this advocation, instead of fretting about the lack of big-time steam, the loss of significant landmarks like the roundhouses (the one near Bethlehem PA comes to mind), Lima, Lagrange, etc.



Superheater@beer.com

> Dennis-In a prior thread, Dave provides this
recollection. My error in not being clear why I initiated this thread. Sorry.

I have vivid memories of a wonderful keynote speech at the TRAIN conference a few years back given by the exec director of Colonial Williamsburg who explained in clear and unambiguous terms that his board only existed for one reason - to go out and get resources for the museum. I quote from memory "Give it, get it or get out!". I remember also wishing boards I worked with had been there to hear that.


Superheater@beer.com

> Who says board members are necessarily
> charged with fund-raising?

I not only think any board member worth his "salt" should develop a nest of donors, but should set the example for them by "bellying up to the bar" when any/every campaign is launched.

wyld@sbcglobal.net

Different board members may be elected for different talents. They should be held accountable first and foremost for what they profess to bring to the organization. Fund-raising may not be that talent.
I also do not think (s)election to the board should be an excuse for forced tithing to the organization. Contribution of some kind,certainly! Not necessarily monetary.

> I not only think any board member worth his
> "salt" should develop a nest of
> donors, but should set the example for them
> by "bellying up to the bar" when
> any/every campaign is launched.


denmeg_hogan@msn.com

Great sloganeering by that executive director! Perhaps it is understood in the Colonial Williamsburg organization about the financial expectations of board members. However, that is not the clear expectation in all railroad museums.
That is something that merits discussion within each organization.
Besides, who mandates the expectations of board members? The general members? The board members? In either case, it's a consensus, right?

> My error in not being clear
> why I initiated this thread. Sorry.

> I have vivid memories of a wonderful keynote
> speech at the TRAIN conference a few years
> back given by the exec director of Colonial
> Williamsburg who explained in clear and
> unambiguous terms that his board only
> existed for one reason - to go out and get
> resources for the museum. I quote from
> memory "Give it, get it or get
> out!". I remember also wishing boards I
> worked with had been there to hear that.


denmeg_hogan@msn.com

> Great sloganeering by that executive
> director!

I have been involved with railway museums for more than 30 years and have been going to meetings of various ("mainstream") museum associations for 25 of those years. It seems that almost all of the people who talk about "give, get, or get off" in regard to money are paid museum professionals.

How, I've heard one paid museum professional tell about setting-up a bicyle museum in the Northwest. She said that when asking one local newspaper publisher to be on the board of the museum he said that he could not contribute money like some of the other members. Her response was to ask if he could provide occasional coverage of the museum in his papers. This he said he could and then agreed to be on the board.

Many times, what a Board member can give to the organization is not money. It may be something in kind, as this story relates. Maybe it is pro bono work; or, getting someone to do pro bono work. I know of one attorney whose firm will do work for the museum; not to short his partners the fees are billed -- but then he has said that he makes a cash donation to the museum to offset the billing -- I hope this is the case. I know of people out of upper-level managment (public or private) bringing their knowledge of HR (personel) matters to the museum setting.

Another reason for someone to be on a board is that they bring knowledge about what the museum is about. If someone knows what the museum is about they can cross check the information provided by the management.

That makes we wonder who many people get elected to railway museum boards because they drove the truck that brought the cars to the museum. I have heard a railway museum member say he could not remember the name of who he voted for, but it was "the guy who drove the trucks that brought the cars to the museum." How many people with the knowledge of a historian get elected to railroad museum boards?

Brian Norden

bnorden49@earthlink.net

Malcolm and I have both had too much experience with boards who, instead of going out and getting what was required to carry out approved programs, frittered away their time and energy trying to micromanage the day to day operations of the organization. I don't need a vote of a committee to tell me what size bolts to buy - but I do need the money to buy them. The following opinions from experience - feel free to tell me where I am wrong.

Once a board has entrusted an agreed upon course of work to a professional, they need to provide what that professional needs to get the work done, and then stay out of the way and let him / her do it. In-process reviews and frequent communications are expected and good, provided they don't deteriorate into nitpicking at every board meeting. I will never forget the 3 hour carhost T-shirt color discussion which turned me off of NRHS membership forever.

No ED is going to have the correct skills set to be the best ED during every phase of an organizations evolution and (hopefully) growth. Boards need to recognise the need to change as requirements change, inclusive of their own makeup. Museum professionals (in the private nonprofit sector) are already aware they will have to evolve or move on when their skills are no longer those most urgently required. Public sector, mostly sinecures, with politics more important than skills.

Bureaucracy on either the board or management level is the refuge of people to avoid the need to evolve or move on. With enough of it one can always appear productive without actually getting anything done. Our federal government is the best example I can think of.

This is a great discussion and with luck it will get some thought going on out there in status quo land. If you aren't changing you are falling behind. Change can be painful (San Diego thanks for sharing, valuable lessons for the rest of us) but without it extinction follows.

Dave

irondave@bellsouth.net

You make many good points. You are certainly correct when you say that the board is legally charged with governance (not the same as managing) the nonprofit corporation AND that they can't affort to just sit back and hope the director and his/her staff are doing it right.

It is likely that we will continue to disagree about the style and method the board "should" use. We can all think of examples of supposedly poor set-ups that work great as well as great board-staff set-ups that fail.

My main point is generally this: rail museums generally fight against the adoption of mainstream museum boards of directors and continue to rely all too heavily on boards of directors elected by the membership. There are a million reasons why this is bad, but the one folks keep overlooking is the fact that fund raising organizations (of substance) almost never give meaningful money to groups with elected boards.

If we want to say railway museums are different than every other kind of museum there is and that that difference means we need hands-on boards and/or elected boards, then my only question after all the money is counted up is: How's that working for you? (That's Dr. Phil's favorite line; sorry, I couldn't resist stealing it. )

-Malcolm

malcolmrcampbell@cs.com

Dave,

And I thought I was just wandering through rypn after a long absence to ask a simple question about F7s.

--Malcolm

malcolmrcampbell@cs.com

> Dave,

> And I thought I was just wandering through
> rypn after a long absence to ask a simple
> question about F7s.

> --Malcolm

And it is good to have you back, my friend.

Dave

irondave@bellsouth.net

> My main point is generally this: rail
> museums generally fight against the adoption
> of mainstream museum boards of directors and
> continue to rely all too heavily on boards
> of directors elected by the membership.
> There are a million reasons why this is bad,
> but the one folks keep overlooking is the
> fact that fund raising organizations (of
> substance) almost never give meaningful
> money to groups with elected boards.

Malcolm,

I agree with you that rail museums rely too heavily on member elected Boards, and some outside Board members are good. However, it does not necessarily follow that money is not available to these groups. As long as they keep their accounting and overall practices in order, grant monies are available. We are moving, albeit slowly, to adding non-members to our Board. Although, our by-laws require Board members be members of the railroad, but this is easily overcome. And, we are looking to add more local business people to the Board.

> If we want to say railway museums are
> different than every other kind of museum
> there is and that that difference means we
> need hands-on boards and/or elected boards,
> then my only question after all the money is
> counted up is: How's that working for you?
> (That's Dr. Phil's favorite line; sorry, I
> couldn't resist stealing it. )

Obviously, our Board situation is working because we are expanding, and though it is no piece of cake, we are getting grants to expand. I think it is working because although our Board members are railroad fans, we hold ourselves accountable when it comes to money. Plus we have a core membership that is devoted to the railroad and seeing that we are successful.

dan



svry@attbi.com

> My main point is generally this: rail
> museums generally fight against the adoption
> of mainstream museum boards of directors and
> continue to rely all too heavily on boards
> of directors elected by the membership.
> There are a million reasons why this is bad,
> but the one folks keep overlooking is the
> fact that fund raising organizations (of
> substance) almost never give meaningful
> money to groups with elected boards.

A very interesting and thought provoking discussion. Though there is plenty of argument in all thing said there are problems once an all non-general elected board is installed. Without knowledge of the culture and operational background many museums and non-profits loose site of the reasons they were formed to begin with. Once persons are installed for only their networking and prestige value without the passion for the subject matter much focus is lost and and once focus is lost groups also loose the talented volunteers that get things done. As with all things, a balance between the two has to happen, as sort of a checks and balances. A board of equal porportions between elected and general-elected members.

Many a museum, chapter,club or 503 have been effectively ruined by persons not knowing or not caring what the original reasons for existance was and changing policy and focus. Changing the focus just for the sake of change or for personal agenda (and that also goes for voting in cronies to impart ones will) is very detrimental and as countless groups ( scores of museum cases to support this intentionally left blank) have been left with dwindling ridership, attendance in general , general memberships and core volunteerism. This is solely due to the persons on the board making policy AS that the board that they are on is their personal playground or due to apathy that it is a waste of their time and not truely having a passion for the subject matter.

Speaking purely as a general member and donator , it is disheartening to be involved in a group where policy can be passed down without any say as to what the core memberships opinion is. Why would a person want to donate heavily to an organization where policy is or could be changed from what you were donating the funds for? After having been on that end of a system I am reluctant to donate heavily to groups that have "the Good'ol Boys club" board. It is far to easy for a closed elected board to one by one replace people for personal agenda. If what we have heard about San Diego is only a fraction of the whole story it is enough to sour people from contributing and or volunterring with them. Unfortunately the petty personal politics all to often negatively impact our preservation arena and more often than people think.

Any thoughts ?

Rich Young
?