Magazine article New Zealand Management

What I Hate about Boards

Magazine article New Zealand Management

What I Hate about Boards

Article excerpt

Byline: Iain McCormick

Being a director must be the most exciting thing you can do with your clothes on! You get to examine the entrails of some fascinating organisations, watch the tectonic economic forces push and pull results, work with some very exciting and dynamic people and get paid for doing it.

But despite the excitement, there are a few things I hate about boards.

I hate boards that won't make clear, decisive decisions. You know the sort. The board that has a robust debate about an issue and edges closer to a decision. The, just when the consensus is crystallising someone says; 'I know this is a slight tangent but ... '. The comment breaks the consensus-building process and the board heads off in a different direction. Unless the chair is astute the emerging consensus disappears and another hour of board time evaporates with nothing to show. Directors must understand the volatility of decision making to be decisive.

I hate boards that don't support their CEOs. Jack Welsh reportedly said boards should ask just two questions: Do we have confidence in the CEO? And, where is the succession plan?

If boards do not have confidence in the CEO they should fire him or her and appoint another. If they do have confidence they should show it. Many CEOs, particularly from not-for-profit organisations, suffer unsupportive and ineffective boards. Boards can't lead effectively without supporting the CEO. This doesn't mean being uncritical or unchallenging -- that is vital. It means clearly and assertively recognising good ideas, good work and good progress.

I hate boards that add cost rather than value. It happens when one or two directors, often ineffective ones, delight in asking for extra data, analysis and documentation, disguising their inability to take considered risks or make wise decisions. These directors create hundreds of hours of extra work to no purpose.

I hate boards that can't see beyond the CEO's good news. CEOs want to make the best of situations and present positive pictures to the board -- their job often depends on it. Boards must distinguish between CEO-dependent and independent information. Astute directors understand executive 'spin' and how to gather independent information. It comes from discussions with senior staff, staff opinion surveys, attending customer, joint-venture partner and supplier meetings where they can talk directly to stakeholders. …

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