Saturday, June 4, 2011

Bored of Directors

I've been on several boards. Some are like a kiss of death. Those are usually the ones where it has a large roster and few show up. The meeting agenda isn't firm and discussion rambles around bushes and down rabbit holes. I leave mentally drained and wondering why I stay on the board.

Some boards are the opposite. I come away energized with new ideas for them and my own endeavors, and a renewed passion for that organization. That's true for those that are private, for-profit companies and the non-profit organizations.

What makes the difference?

  • Focused on board's responsibilities: there are only a few things for which the board has responsibility. The list may grow a little for a non-profit board (like fund-raising) but it's still limited. The scope of a board's penetration into the organization is fairly shallow. We're not responsible for the day-to-day. We're responsible for the financial health and the overall performance of the organization and the CEO. We need to monitor the risks to those concerns, and assure they're being addressed. We select the CEO (or Executive Director for a non-profit) and determine his or her compensation. We want to make sure there's depth to the leadership bench in terms of succession and a strong leadership team. These issues don't arise every meeting. (I've watched several school board meetings and find, often by state mandate, that they violate a lot of this need for focus on the big-picture issues.)
  • Limit operational discussion to understanding how the CEO and others on the leadership team think: The members of a board will come with their own philosophy and values (which, by the way, should be vetted during the selection process). There may be a strong consensus about how organizations are run by members of the board. However, operational and tactical discussions should be limited to advice, feedback, soliciting the CEO's perspective and acting as a sounding board when requested by the CEO. We are not the management team. We are not asked to make operational and tactical decisions. That is the responsibility of the management team. The board does not run the company. We protect and serve the shareholders (stakeholders, including employees and their job security).
  • Have compelling discussions: As board members, we should be interested and engaged in the mission of the organization. We should be earning our "pay" and providing value to the organization. Otherwise, they don't need a board and they can spend their time preparing for the board meetings and taking care of board members in more productive efforts. We are here to serve the organization, not the other way around. Laws require a board but it shouldn't be taken for granted. As directors, we come with many skills, talents, experiences, knowledge bases, ideals and dreams that can and should be shared with the others. If we do so, the discussions will be compelling as we thrash out and refine the strategies, the causal factors for the positive and negative trends in finances and performance, etc. If we're fully engaged, and don't suffer from "groupthink" the best plans will be like gold, with the dross skimmed away, leaving a shiny, valuable pool of information and endeavor.
  • Evaluate the board performance and make improvements: similar to the point above, good boards evaluate their group's value to the organization, and their individual contributions. Are the dynamics healthy? How useful is the information exchange? How focused are we or do we get distracted in minutiae and operational issues?

Though a board's function is pretty limited, there's still plenty of areas for great and valuable conversations, leading to a remarkable vision for the organization. Maybe you're bored being on a board, but it doesn't have to be.

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