Why. What. When. How?

This article argues for a human-centered approach to governance, emphasizing the need to focus on decision-making that fosters good governance, risk, and compliance. It explores how understanding organizational systems and culture can enhance performance and drive meaningful change, advocating for a shift from compliance to a purpose-driven framework for better decision-making.

Is it the structures, rules and policies that ensures good governance, or,
Is it the the power of humanity?

This article will be discussing – if we want better governance, risk, compliance then perhaps we need to bring humans back at the focus.

So, how far back does governance go? It may not be all the way back, but the word ‘governance’ derives, from the Latin “gubernare and” Greek verb kubernaein [kubernáo] – both, meaning to steer. So, in essence, governance is decision-making and by extension, how well we action decisions.

The recent “Post Office Horizon” scandal in UK is one of many examples demonstrating the way we are making decisions…

…is not serving us well
…is not working
…is limiting us.

Why is this happening? Governance is a performance exercise – it’s not a compliance one, however, that’s exactly what it has become. As leaders of organisations, we want to understand what’s going on in our whole organisation system. We want to understand what systems are not working, what is working, what can we do to make it better and what can we adjust to ensure better performance, maximise the opportunity for profit, whilst at the same time being regenerative.

More often than we would care to admit, we make decisions by lifting the proverbial ‘finger in the air’. We don’t exactly know what can we do – which levers can we pull to uplift the power of whole organisation system. We’ve become too bogged down in the reductionist approach to business management. We need to open ourselves to observing the system as a whole. Observe our organisations as a ‘systems’, which are both complex and non-linear – an approach that’s called systems theory.

We know from countless research and evidence that when we see organisations as a whole system, and we approach it through a multifaceted lens, we enhance our chances of locating the levers that will move us towards better. An interconnected system that doesn’t just look at an organisation’s strengths and weaknesses, but supports you in understanding more deeply the relationships between. So, for example how is the quality of information you have is affecting the decisions you’re making? Or, How is the quality of leadership influencing your culture? By observing and understanding these relationships, only then can we see the levers that need to be pulled to maximise and leverage the power of an organisation system.

Now, this would be much simpler if organisations were run by machines, but organisations are innately human – and that’s what makes this process both complex and emergent. You may have heard of The Butterfly Effect. When a butterfly flaps its wings in North Carolina and causes a tornado in New Jersey! “Local small changes brings large change and global order.” – from Roger Lewin, Complexity, life on the edge of chaos.

What if we could simply model this complexity and these interrelationships, so that they were easier to understand. Here is one such model (Refer to CoSteer's website - www.costeer.co). The area we’re aiming at is the intersection, where each of the three influencers on good governance converge.

Understanding and trying to approach governance from a reductionist, compliance oriented regime will continue to give us the same result, a disconnected, low performing system, such as we see in Horizon.

Culture in its own right is meaningless. Good decision-making without high ethics is dangerous and even if we do both these well, if we have poor mechanisms for implementing our decisions and the oversight of this, we end up with a poor performing system. But, together they do hold the power to drive good governance, although easier said than done.

Rigid hierarchies and traditional mechanistic approaches, where there is poor top-tier setting of culture for the whole organisation and setting rules and policies is the dominant way of influencing decision-making, mean we end up with a disjointed system where the whole is barely a sum of its parts. What we need is a connected approach, where the prevailing culture, driven by the purpose of our organisation, drives decision-making and the ‘way’ we put those decisions into action. Values are our ‘way’.

The ISO Standards of Organisational Governance (ISO37000) puts ‘purpose’ at the heart of practising good governance. “At the heart of all organisations is purpose, i.e. a meaningful reason to exist. Values inform both the purpose and the way the purpose is achieved. Purpose and sustainability are now at the heart of governance”. Good governance is a practice, it’s something we have to work on everyday. Merely being compliant is not enough. We need to do the hard work of improving governance performance, not just compliance.

Perhaps it’s as simple as – governance is good decisions, done well for the right reasons.

So, how can we get better at governance?

We need to ask ourselves 4-questions each time we make a decision.

Why. What. When. How.

The ‘Why’ signifies purpose (why we are doing what we are doing?)
The ‘What’ signifies the nature of our decisions (what have we decided to do?)
The ‘When’ signifies the timing of our decisions (when shall we make this decision?)
The ‘How’ signifies the way we have made the decision (how have we made this decision?)

We want to be able to say – “that was a good decision, done well for the right reasons”.