We commonly hear and say that “Tone at the Top” matters – but what does that mean, and how does it really matter?
Generally a mission-driven set-up, the Board of a Non-Profit Organisation (NPO) mainly comprises of volunteers to provide oversight to the execution of activities that is managed by a Management Team. For some NPOs without the luxury of a complete Management Team, the Board then takes on the role. In such cases, the “tone” comes from the very top.
“Tone” can be generally defined as the “pitch, quality and strength” of a vocal sound; or the “general character or attitude” of a situation which are both expressed through and developed by people. So, we can infer that the quality and strength of the people steering the NPO ship can be gauged simply from the general character or attitude of the NPO control environment demonstrated.
It goes the same for understanding organisational culture. The Center for Advance Research on Language Acquisition defines “culture” as “shared patterns of behaviors and interactions, cognitive constructs and understanding that are learned by socialisation”. It is the growth of a unique group identity fostered by social patterns and simply put, is how people behave on what they believe in.
Both the “Tone at the Top” and “culture” possess critically interrelated characteristics. Regardless of the stage of their establishment life cycle, this concern of not having the “right tone” is very valid and relevant for every NPO and can determine its success – which inherently comes from passionate people who believe in what the NPO has set out to achieve.
To affirm the NPO’s belief, it is expressed in its vision or mission statement – which will serve as the foundation for the organisation’s strategy and culture and guide decision-making for the organisation. It offers insight into what the leaders view as the primary purpose for the NPO being in existence – which intrinsically sets the tone at the top that drives the culture.
However, most NPOs have mission statements that are too broad and not integrated with the NPO culture. Coupled with the fact that most NPOs are managed by Board members coming from various backgrounds and carrying conflicting expectations, some going beyond to play the execution role, the mission is often confused, diluted, misinterpreted and not followed through. When the “mission creep” takes its own form, the mission cannot be consistently carried out through strategic actions.
As a result, it cannot inspire or foster unity of action from the rest of the organisation. It instead breeds an organisational culture of a non-united and ineffective team with little passion in carrying out their duties, and limits growth for the NPO as everyone is working in different directions. Following which, cultural issues – such as having no shared ownership and room for creativity, communication breakdown, ineffective or lack of accountability and cross-cultural miscommunication – may surface and contribute to the pitfall of the NPO.
A ‘good’ mission is aligned with and will continue to foster the right culture, which must first consider the people. It should help to inspire, motivate and unify staff, Board members and volunteers; it sets goals and help measure success factors and reinforces shared values, norms and beliefs.
With experience in NPOs as a Board member, I can vouch that managing NPOs require more effort than managing your own companies. A huge expectation gap exists between the Board, Management Team and beneficiaries in how they view a NPO is to behave – such as conventional mindsets that a NPO cannot have surpluses. A question to the Board: why should the operating mindset for NPOs differ from your precious management experience for your companies? I like to caution that when NPOs are stuck in a “poverty trap”, they may not be able to attain what their mission statements have set out to achieve and will lead the NPO to have the wrong focus.
Here, I urge the Boards to re-think their existing mission statements and translate them into feasible yet simple strategic actions that the Management Team can execute and believe in.
About the Author: Jenny Tan
Jenny is a Partner with more than 18 years of experience in providing and managing assurance and consultancy services. Her expertise includes Business Continuity Management, Internal Audit & Risk Management, IT Audit & Advisory, Outsourcing Standards and non-profit organisation services. Prior to joining PwC, Jenny was leading the Technology Risk Management and Non-profit Organisation (NPO) Services Practice of Singapore’s largest mid-tier professional organisation.
Jenny, whom is currently leading the IT Audit Support Practice of PwC Singapore, has led and managed numerous IT audit and internal audit jobs. Her portfolio included regional work in the Asia Pacific region. Through her practical experience in leading complex global engagements, she brings an appreciation of the approach and dedication required to deliver a consistent, high quality global audit. Jenny is also a regular trainer on her risk assurance subjects to internal and external professionals.
Jenny holds a Master of Accountancy, Master of Business Administration, Bachelor of Science in Business Computing (Hons), Graduate Diploma in eCommerce and Graduate Diploma in Information Technology Security. She has several professional certifications and she has served on the board of a non-profit organization, ISACA, since 2015.
Jenny has experiences with NPOs as consultant as well as voluntary board member.