Adapt or Fail!

A 5x5 Governance Framework for Boards of Director

Cover of a book titled "Adapt or Fail!" by Frederick Rick Funston and Jon Lukomnik, with a subtitle "A 5x5 Governance Framework for Boards of Directors," featuring five vertical bars with icons representing leadership, direction, checkmark, organization, and analysis, and a quote at the bottom by Douglas K. Chia.

Overview

Conventional approaches to board governance have been unable to keep pace with the momentum of change, as well as the uncertainty and asymmetric competition that characterizes the 21st century. Adapt or Fail! A 5x5 Governance Framework for Boards of Directors provides practical ways boards can lead and accelerate adaptation, even in the face of extreme uncertainty and inevitable adversity. It pulls back the curtain on governance successes and failures. It highlights the critical questions every board should ask and the lessons worth learning if organizations are to successfully adapt.

The book describes the five essential powers common to all boards and explores how to use them. Whether for profit or not, large or small, public or private, all boards must conduct the business of the board itself; set direction and policy; approve key decisions and then prudently delegate; oversee the execution of direction within policy; and verify before trusting.

Written by two governance experts who have lived and breathed these issues, the book shows how boards can embed a systematic and disciplined process of continuous adaptation by detecting signals (external/internal); interpreting those signals; responding through experimentation and innovation; judging the effectiveness of the response; and then adapting as necessary. This is an indispensable resource for board members and trustees in both for-profit and non-profit organizations.

  • Describes how board members can drive sustainable performance at acceptable levels of risk.

“Rick Funston and his team at Board Smart have designed a very practical, impactful way of educating pension plan trustees. Using the progressive disclosure method of communicating, starting with easy-to-digest pieces of information and then allowing board members to drill down into more detail on each subject, makes the complex world of a pension board fiduciary less intimidating. Transforming the Dialogue: Fiduciary Essentials builds upon the Board Smart curriculum and acts as a ready reference for all board members, regardless of tenure.”- Kevin Olineck, Executive Director of Oregon Public Employees Retirement System
“The Fiduciary Essentials Handbook is an invaluable guide to fulfilling fiduciary responsibilities and protecting pension system integrity. A must-read for Trustees and Administrators.”- Katie Girardi, Executive Director, San Luis Obispo County Pension Trust
“This Handbook should be required reading for trustees and pension system staff. From my vantage point, it will not only be helpful to the ongoing development of the system (our system or any other), but also an independent resource to validate policies and practices with trustees or other stakeholders and a great developmental tool for staff advancement purposes.”- Scott Simon, Executive Director, MoDOT & Patrol Employees’ Retirement System
A smiling older man with a bald head and white beard, wearing a dark blazer and light blue shirt, against a plain white background.

Frederick (Rick) Funston

Author / Editor information

As the CEO of Funston Advisory Services LLC (Governance, Risk and Compliance Solutions) and Board Smart (online governance and fiduciary education), I bring over 50 years of practical experience in helping boards and executive teams elevate their governance, risk intelligence, and strategic performance. At the intersection of insight and action, I guide leaders through complex transitions and oversight challenges. Throughout my career, I have specialized in being a generalist in conflict resolution, de-escalation and consensus building across more than 20 industry sectors spanning public and private companies, not-for-profit and government agencies.

As a former Deloitte National Practice Leader principal, I led governance and enterprise risk management services. I coined the term “Risk Intelligence” to describe the critical capabilities needed to take calculated rewarded risks while avoiding unrewarded ones. My advisory work is rooted in enabling collective adaptation to a fast-changing environment with clarity, resilience, and insight.

A nationally recognized practical thought leader and public speaker, I have been the principal author of four books on governance and risk. The most recent include “Adapt or Fail: A Five by Five Governance Framework for Boards of Directors” with Jon Lukomnik (De Gruyter) and “Transforming the Dialogue: Fiduciary Essentials” (Amazon).

Over the past fifteen years, I have led more than 60 reviews of public retirement systems and institutional investors of all sizes and circumstances overseeing nearly $3 trillion in assets. Whether advising on governance, performance and risk oversight, or leadership development, I focus on helping clients build the capacities to rapidly adapt and succeed.

Let’s connect if you’re seeking strategic guidance on governance, oversight effectiveness, or fiduciary education.