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Old April 24th 04, 12:14 AM
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Default Confronting Reality


In reviewing previous candidate's statements in Chess Life I noticed that
nothing that was said appeared to have been accomplished or even attempted on
the membership's (your) behalf. Therefore, rather than a description of what I
have done in the past I focused my May Chess Life statement on what I would do
in the future if elected so you (the membership) can hold me accountable for
pursuing that result. This included working towards:

Determining and reporting where our money really goes.
Focusing on core programs to improve efficiency.
Making our 990s more accurate, timely, and available.
Participating in the selection and evaluation of a new executive director.
Strengthening board policy to avoid conflicts of interest or the appearance of
Setting the groundwork for a new strategic plan.
Conducting an annual board and outcome assessment.
Including a membership survey with the 2005 election supplement.
Identifying, cultivating, and recruiting new prospective board members.

I'd like to use this platform to put those proposed actions into context and to
help give you a perspective of how that fits into an overall approach. When
selecting a candidate to vote for I suggest you look carefully at what they
currently are doing, what conflicts of interest exist, their game plan, and
what skills they will bring to bear on your behalf.

The Not-for-Profit Setting


The USCF is a membership corporation. The purpose of the federation is
educational and instructional, to broaden and develop chess as art and
recreation, as a significant element of culture in America. Learning the game
should be part of our culture. Chess is fun, keeps you mentally fit, and is a
healthful lifelong recreation. We should strive to create more players and
better players for the sport.


The Executive Board has both a legal responsibility to discharge a public
benefit purpose (its mission) as well as a moral obligation to meet the
expectations of those on whose behalf the organization exists (its membership).
When asked the question -- why should I join the USCF -- I can talk about the
benefits members receive but that is not why the organization exists. Outside
that right now I don't have a compelling answer. Perhaps that is our problem,
as our reason to be has gotten lost. However, one thing I've learned in
volunteering to serve on the board that is a good reason to join is our members
themselves. I've had a chance to interact with some truly committed people who
feel that playing chess is fun and can have an impact in people's lives. Our
grass roots USCF members are truly the gems of the sport. Whether USCF members
are donating money or time, in my view the future now could not be in better
hands. Hats off to our members! It is their corporation and we have not yet
begun to tap our most valuable resource, our membership.


As you may be aware the USCF has been struggling financially. In today's
uncertain economic times there requires a different level of focus and
commitment from nonprofit organizations. In today's climate of increasing
liability exposure, nonprofit organizations must demonstrate their willingness
to be accountable. The way to reach this goal is to have a strong businesslike
board. A businesslike board should have two broad categories of directors.
First, you need advocates for your mission -- people who passionately believe
in what you do. These people keep you honest to the first rule of
not-for-profits: mission, mission, and more mission. The second group of people
you need are businesspeople, and these folks keep you honest to the second rule
of not-for-profits: no money, no mission. These two groups provide a dynamic
and very healthy tension on the board and help the organization balance the
needs of the two primary rules. Both groups need to clearly understand they are
accountable to the membership, which is the third rule in this equation: no
members, no money. Because of this our financial recovery must be our most
pressing priority.


To quote USCF President Marinello: 'Let's face it: Our Executive Board and our
Delegates are enthusiastic amateurs. We use the word "amateurs" in its best
sense -- we are all "lovers" of chess. But our operations are now too large,
complicated, and far-flung to be managed by amateurs, no matter how
enthusiastic and well meaning. We need a high-quality board of experienced and
successful people, and a sophisticated professional staff that runs our
nonprofit business according to best modern practices.'

The Executive Board has the principal responsibility for fulfillment of the
corporation's mission and the legal accountability for its operations. Board
members therefore hold the key to organizational accountability and are its
guardians on behalf of you -- the membership. This means that the board is in
charge of establishing a clear organizational mission, forming the strategic
plan to accomplish the mission, overseeing and evaluating the plan's success,
hiring a competent executive director and providing adequate supervision and
support to that individual, ensuring financial solvency of the organization,
interpreting and representing the membership to the organization, and
instituting a fair system of policies and procedures for human resource
management. The board in essence directs, oversees, and measures how the
mission is accomplished. Right now, to be effective in my opinion, the board
needs professional people with experience in the above disciplines who are
willing to roll up their sleeves and pitch in.

The Challenge

Since 1980 the USCF has ended up with a negative annual fund balance at least
sixteen times. Another negative annual fund balance is expected this year. Some
would argue this condition has occurred even more often as Life Member Assets
and other segregated funds were commingled with operating funds masking the
annual result. As of this year our Life Member Assets are now, for all intents
and purposes, gone. The fundamental problems facing the USCF can be summarized
into three distinct areas that must be addressed.

Mission Drift

The purpose of the USCF is solid but seems to have been lost or diluted. Over
time the corporation emphasis appears to have shifted from chess promotion to
chess promoters. The schemes employed vary but are often oriented around using
USCF membership dollars to subsidize or compensate tournament
organizers/directors or related service providers. Thus, in the view of many,
the focus has become internal rather than external and means have become ends.
As a result, there is no clear-cut membership facing business plan, no
validated strategic goals, and no accountability for meeting these nonexistent
goals. The USCF is facing an identity crisis. We must get our original purpose
back to the forefront of all that we do.

No Fiscal Discipline

The folly of the last decade for the USCF has come from a focus on increasing
the number of members and the amount of sales revenue without regard for
expenses. Overly optimistic revenue projections and artificially inflated
reporting have been additional problems. The budget is largely ignored once
passed. If the board wants to do something, it votes for it, whether there is
money available or not. If the Executive Director wants to cut a deal with
someone, or wants to hire new staff, they just do it, regardless of budget.
There is simply no reliable financial oversight. The USCF must learn to ground
and manage its budget and reporting processes in reality.

Lack of Accountability

For more than a decade now the Executive Director or their equivalent has
ignored the direction of the board. We have been unable to put in place an
Executive Director who will obey board financial or program directives. We have
also had Presidents who have ignored such directives. The Board of Delegates
and Executive Board also have ignored the direction of the membership or had
their own agendas. No one has been held accountable to produce results on
behalf of the organization. Special interests and secrecy have been major
organizational issues. Organizational accountability must be improved.

Generating Energy for Transformation

Focus on Core Mission and Strengths

Program decisions need to be based on a strategy platform that focuses the
mission on outcomes. Understanding exactly where the money comes from and where
the money goes for each core program is essential to keep the mission and
associated outcomes on track. By identifying program costs, we will be in a
better position to determine which activities deserve our time and attention.
We must tighten our focus on core activities that are central to our mission
and do them as well as possible -- quality is what will matter in our services
and programs. Now is the time to prioritize and scale back our activities to
focus on core items such as the Chess Trust, ratings/rules infrastructure, the
magazine/web information, and chess governance. From there we should rebuild
our services consistent with the mission and consistent with what you the
membership feels is of value. Membership dues should address core programs and
all other activities/services should be self supporting and fee based. Dues and
membership benefits need to be right sized accordingly. We need to take a hard
look at our revenue and expenses and at this point plan for the most likely and
worst-case scenarios for our organization, and develop strategies to deal with
each one.

Communicate Clearly, Honestly and Regularly

To manage speculation or fear of the future, we must communicate both formally
and informally with the membership on a regular basis about what's happening
with the organization, and keep the lines of communications open with the
members. Better disclosure of corporate information will help with this
communication. Communications must be a two way street. Far too often, we think
we know what our membership thinks and needs. Businesses such as ours can't be
successful if they don't continue to meet the real needs of their membership.
There should be few activities as important as finding out what the membership
thinks and wants for outcomes, products, and services as well as finding out
what they think of ours. Fortunately, there are a variety of practical methods
that organizations can use to gain feedback from its membership.

Engage and Tap Skills for the Organization

Board improvement is important. Board members must always place the USCF needs
first and not have their interests divided with those of other organizations.
Every board must be willing to accept and even thrive on change.
Self-assessment, new perspectives, and different ideas keep the board and
organization moving forward. All boards need to select members with the skills
and aptitude that meet the organization's needs. We must look for ways to
increase the skills of our current board or make changes in board membership so
that we have the right sets of skills and commitment required for today's
uncertain environment. Board skills that are even more critical in these times
include financial management, fund raising, information technology, and
communication. We also need to better engage the talents within the federation
to help the board with all the work that needs to be done. Rather than using
board committees as dumping grounds we must reengineer, empower, and challenge
our committees to meet objectives and produce results required by the board.
Effort must be expended by the USCF to solicit the help of the membership. The
organization must be more open, inclusive, and results oriented if it is to
regain the trust of the membership. Along with earned trust will come new blood
and participation.

One of the key duties of a board is to hire a competent and professional chief
executive to run daily operations. Part of this duty assumes that there is a
valid job description and a performance evaluation process in place. The
board's role is to oversee that the organization is well run; not to interfere
in the domain of the chief executive. The chief executives performance affects
the performance of the entire organization. Clear objectives and limitations
combined with regular evaluation of the chief executives performance is
important to produce useful results and to improve organizational performance.

Renew the Strategic Plan

Strategic planning is an important management tool. As with any management
tool, it is used for one purpose only: to help an organization do a better job
- to focus its energy, to ensure that members of the organization are working
toward the same goals, to assess and adjust the organization's direction in
response to a changing environment. In short, strategic planning is a
disciplined effort to produce fundamental decisions and actions that shape and
guide what an organization is, what it does, and why it does it, with a focus
on the future. We must reassess and develop an organizational strategy that
everyone understands. We need to balance short-term and long-term planning, so
that the organization can respond quickly to this month's challenge while still
keeping your eye on the future. Every organization has competitors, including
not-for-profits. They compete for donations and grant funding, skilled
personnel, and for market share with the products and services they provide. In
order to be successful, they must provide services that are in demand at a
price that allows the organization to sustain its mission-driven operations. We
need to clearly establish the goals and vision for our future.

Closing the Gap

We must be able to create new meaning for our organization. An important
component of this task is to articulate a new strategic intent for the
business, one that explicitly connects important membership needs with the core
competencies of the corporation. We must ground the new vision in a business
success model that tests its assumptions and provides metrics to gauge progress
toward it. Then we must facilitate an honest assessment of the capability of
the organization to renew itself. Nothing less than an examination of the total
system will suffice. No sacred cows can be allowed to graze undisturbed. From
this process, the major gaps separating the current organization from the
desired organization and our future vision must be identified and prioritized.
Only then will we be in a position to distill a limited set of corporation-wide
transformation initiatives that are needed to focus the organization and define
the new critical path for our success. To jumpstart the process our first small
steps must be to focus on core mission and strengths; communicate clearly,
honestly and regularly; engage and tap skills for the organization; and renew
the strategic plan. At this point we should be able to begin our
transformational journey.

Your Vote Can Make a Difference

Well meaning as they may have been, your leadership has let you down in the
past and there was little you could do about that except leave the
organization. Now you have the opportunity to vote and make a difference. I'd
like to be part of that difference. I'm a business professional and feel I can
bring something useful to the USCF. I hope you do too. Whether you are
interested in having me represent you on the board or not, I encourage you to
vote. Together I believe we can create a better USCF.

For more information about myself and my views on the issues, please visit my
website at . Also feel free to stop by and
view my weblog at .

Wayne Praeder

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