The Board from Hell (pt.3)

Taken from the Autumn 2003 issue of the ZEITGEIST Client Newsletter
    
 
Next up in the series that just won’t die...the thorny issue of whether the effective DMO Board is appointed, elected…or a mixture of the two.

THE APPOINTED BOARD.
For a number of seemingly rational reasons, government often believes that it needs to “control” the Board of Directors of the organization in which it is investing tax revenue. They’ll use terms like “stewardship” and “oversight” instead of saying flat out that they don’t trust you. But, it’s all the same thing. And, it’s all about control.

But it’s not just government. Industry associations (such as the local innkeepers, restaurateurs and attractions) and other special interest groups will lobby for seats on the Board. In many instances, DMO Boards have agreed that such representation would be (in theory) a good thing…and then have punted away their future effectiveness by allowing these groups to select their representatives for the newly created seats.

To avoid becoming another “Board From Hell,” the smart DMO Board must do everything in its power to avoid the pitfall of appointed members controlling the majority of the seats and, thus, the conversation.

A DMO Board should never allow more than 50% of its seats to be chosen or appointed by those outside the Board. The reason: a Board made up of appointees cannot represent the best interests of the organization. They represent the interests of the appointers.

Think about it. The Mayor appoints six members. The County appoints six. The Chamber appoints three. And there are three at-large seats. And let’s say the City is contemplating a significant reduction in its investment in the DMO.When the inevitable push comes to shove, the Mayor will call in her chits from her 6 appointments. Assuming that the County is also in a budget crunch and wants to maintain some harmony with the City, the County votes will surely block an objection from the DMO Board to the Mayor’s proposed cuts. And, the Chamber, also wanting to stay on the Mayor’s good side, will vote her way as well.

Now, let’s look at a scenario where the City and County each have an appointment…as does the Chamber and the local Hotel Association. The other 14 seats are Board selected. The Mayor announces plans to cut the DMO budget.

The decision on whether to oppose the move will be made on the merits of the proposal. How will it affect the long term viability of the DMO and the destination? Does the Board believes it has a leg to stand on to fight back?

In other words, the Board will make the decision that is best for the organization at that point in time. Chances are, the Board may well agree to the reduction rather than go head to head with a strong Mayor. Or maybe they won’t. But, either way, it’s the organization talking…not a politician that controls seats from the outside.

But (I hear you cry), what about the City’s argument that it must have seats to oversee the tax revenues being invested in the DMO? Easy. Tell ‘em they’ll get all the oversight they need with a well written contract for services between the City and the DMO. In fact, the level of control will be greater with a contract because the Mayor won’t have to worry about her appointees wiggling on her on a close vote.

The best Boards are self-selected with a focused eye on landing the best and the brightest minds in the community to help lead the destination to the proverbial “next level.”

ZEITGEIST CONSULTING
PO BOX 45445 - MADISON, WI 53744 - 608.836.8876