THE SEVENTY PERCENT QUESTION: Why Selection Is the Most Consequential Decision Your Institution Will Ever Make, and the Board Is Where It Begins (Boards That Work- Part VIII) – By Dr Bolaji Olagunju

I want to share with you a conviction I have held for most of my professional life, sharpened by every year that has passed and every institution I have studied closely. It is a conviction I have stated before in various forms, and one I will state again because I do not believe we have absorbed its implications in this country with the seriousness it deserves.

Seventy to eighty per cent of any institution’s success is determined by selection. Not by strategy, not by funding, not by technology, but by selection.

Who is in the room? Who is given the work? Who is trusted with the decisions? Whether you are running a company, a ministry, a regulator, a development bank, a teaching hospital, a foundation or a country, the people you choose determine, more than anything else, what happens next.

This is not an opinion I have arrived at lightly. It is a conviction shaped by more than two decades of advising organisations on what makes them perform, by careful study of institutions that have succeeded and institutions that have failed, and by the patterns that emerge again and again in both. The institutions that perform are the ones that selected well. The institutions that fail are, with almost monotonous regularity, the ones that selected poorly. Everything else is downstream.

If this is true, and I believe it is, then the single highest leverage decision in any institution is the selection decision. And in any institution that has a board, the highest leverage selection decision of all is the selection of the board itself, because the board sits at the top of a cascade that determines every selection that follows.

Today I want to describe that cascade, and to make the case that it is the most underappreciated structural fact in our entire public sector.

The cascade

The selection cascade has five tiers. They sit on top of each other in a particular order, and each tier shapes the next. Once you see the cascade, you cannot unsee it. Almost every institutional outcome in our public sector can be traced through it.

Tier one is the Board. This is the upstream choice from which everything else flows. The composition of the board, the calibre of its directors, the standards they hold themselves to, the seriousness with which they take their work. This is the foundation.

Tier two is the Chief Executive. The board selects the Chief Executive. In any well governed institution, this is the single most important decision the board ever makes. The choice of Chief Executive determines, more than any other single act of governance, what the institution will become over the next five to ten years.

Tier three is the Executive Team. The Chief Executive selects the executive team. The Directors, the General Managers, the Heads of Department, the senior management cadre. The Chief Executive’s selection choices shape who actually runs the institution day to day.

Tier four is the Culture. The executive team produces the culture. Not by decree. By what they tolerate, what they reward, what they ignore, what they punish, and how they behave. The culture is the residue of a thousand selection decisions made by the team at the top, replicated through the layers below.

Tier five is the Results. The culture produces the results. Not the strategy, not the policy, not the funding. The culture. Strategy without the culture to execute it produces nothing. Funding without the culture to deploy it well is wasted. Policy without the culture to honour it is a piece of paper.

Five tiers, one origin. And the origin is the board.

What this means, and I want to say it as plainly as I can, is that every result your institution produces, every reform that holds or does not hold, every standard the institution meets or fails to meet, can be traced upstream to who is on the board. The board is not merely one input among many. The board is the upstream cause from which the others flow.

Why this changes the calculation

If you accept the cascade, your view of board appointment changes immediately and permanently. You can no longer treat board appointment as a ceremonial honour. You can no longer treat it as patronage. You can no longer treat it as the resolution of a political map. You must treat it as the most consequential personnel decision in the entire institutional architecture, because that is what it is.

I want to put this in concrete terms.

If a parastatal is producing weak results, the cause is almost never weak results in isolation. The cause is a weak culture. The weak culture has been produced by an executive team that has either accepted it or actively created it. That executive team has been selected by a Chief Executive who has either chosen poorly or selected for the wrong things. That Chief Executive has been selected, supervised, and either retained or replaced, by the board. And the board has been selected by an appointing authority that has, at every step, made choices upstream of every downstream outcome we are now observing.

When we ask, of a struggling public institution, what went wrong, we typically look at the most visible tier. We point to the management. We replace the management. We then wonder why the new management produces results barely different from the old. The answer is that we have intervened at the wrong tier. The problem was never the management. The problem was the cascade that produced the management. The board selected the wrong Chief Executive, or selected the right one and then failed to supervise. The Chief Executive selected the wrong executive team. The team produced the wrong culture. The culture produced the wrong results. Changing one person at one tier without changing the cascade above changes very little.

This is the structural reason our public sector reforms so often fail. We are intervening too far downstream. The intervention needs to happen at the origin of the cascade. It needs to happen at the board.

The lesson from Lincoln

I want to draw, briefly, on an example I have used before. When Abraham Lincoln was elected president of the United States in 1860, he made a decision that has been studied ever since as one of the most consequential selection acts in modern political history. He invited his fiercest political rivals into his cabinet. William Seward, who had expected to win the nomination Lincoln took. Salmon Chase, who believed himself the better candidate. Edward Bates, who had run against him. Lincoln, who could have appointed loyalists, appointed instead the most able men he could find, regardless of whether they had supported him.

What Lincoln understood is the same thing we are struggling with in our public sector today. The institutions of government must be staffed for competence first. Loyalty matters, but it cannot be the primary criterion. Political balance matters, but it cannot be the primary criterion. Personal comfort matters, but it cannot be the primary criterion. The work matters most. The selection must be made for the work, and everything else must adapt.

The cabinet Lincoln built did the work. It carried the United States through the most existential crisis of its national history. It is not difficult to imagine what the alternative cabinet would have produced. Lincoln knew. He selected accordingly. The country he served has benefited from his selection discipline for over a century and a half.

We can do this in Nigeria. We have, sometimes, done it. When Dora Akunyili was appointed to NAFDAC in 2001, the appointing authority made a selection that did not follow the usual pattern. She was not, at that moment, a famous figure. She was not the political accommodation of any major bloc. She was selected, by all accounts, because of who she was and what she could do. The cascade that followed transformed an agency that the country had given up on. That outcome did not come from policy reform. It did not come from new funding. It came from selection.

The point is not that every appointment must be a Dora Akunyili. The point is that selection, done seriously, produces results that no other intervention can produce. And selection, done unseriously, produces the institutional landscape we currently have.

What the cascade requires of us

If we take the cascade seriously, several things follow as practical consequences.

First, the board appointment process becomes the highest priority reform in the public sector, not the lowest. The amount of time, rigour, scrutiny and care that is currently invested in selecting a board for a major federal agency is, in my reading, inversely proportional to what the importance of that decision actually demands.

Second, board succession planning becomes a serious institutional discipline rather than a ceremonial one. Every public sector board should know, today, who is being considered for every seat that will fall vacant in the next three years. The pipeline should be identified, developed, and maintained, not improvised at the moment of vacancy.

Third, the appointing authorities must accept that their selection choices are public acts with long downstream consequences. They cannot hide behind procedural formalities. They cannot defer to whatever names are floated by their networks. The selection is theirs, and the cascade that follows is theirs. The country will hold them responsible, eventually, for both.

Fourth, the board’s own first job, once constituted, is to do the next tier of the cascade well. The selection of the Chief Executive is the board’s primary act of governance. It is the act on which the board’s entire term will be judged. A board that selects a strong Chief Executive has done more for the institution in that single decision than it will do in most of its subsequent meetings combined.

The work ahead

The seventy percent claim I have made is not a precise statistical assertion. It is a practitioner conviction, drawn from long observation of organisations across many sectors and many years. I would defend it against most alternative explanations of institutional performance. I would suggest, to anyone who doubts it, that they look closely at any institution they know well, ask honestly what produced its current results, and follow the trail back to the selection decisions that began the cascade.

I expect they will find what I have found. The selection is the origin. The cascade follows. The board is the upstream point from which everything else flows, and getting the board right is therefore the upstream act from which institutional transformation actually becomes possible.

The board sets the ceiling. Selection sets the board. And selection is, by my count and my conviction, seventy to eighty per cent of the success of any institution we will ever build in this country.

If we are serious, this is where we begin.

Dr Bolaji Olagunju is the Founder and Group Chairman of Workforce Group, a human capacity and organisational performance firm founded in 2004 and operating across Nigeria and Africa. He is also the Founder of Philantify and the convener of Leadership That Works, a platform devoted to the question of what really works in leadership. His books include Hiring Right: A Matter of Life and Death for Businesses and Business Owners; The Seven Disciplines of Breakthrough Results, a public sector leadership playbook for DGs, CEOs, Permanent Secretaries, Directors and Senior Leadership Teams; and Blueprint for Capacity Development Excellence, a strategic framework for strengthening the institutions and professionals at the heart of Africa’s human capital. He writes here in a personal capacity. This series is intended to provoke serious reflection on leadership, governance, and institution building. He welcomes thoughtful engagements on the subject from all institutional leaders committed to building institutions that work. He can be reached via [email protected].