Platt, Lewis E., Chief Executive (U.S.)
When Lew Platt signed up for Wharton's governance boot camp, he had little idea,that the Institute's learning through role-playing" would challenge his notions of running a modern board of directors. But the experience convinced him that the best way to improve H-P's board was to change his own behavior. Sometimes it's okay to admit you don't have all the answers.
Let's be honest. With all the responsibilities we as CEOs have running companies, jugglings meetings, and attending to personal lives, we barely have enough time to sit on a board, let alone take time out to learn how to do it effectively. I, for one, am constantly under the gun in my job and am frequently invited to make presentations at seminars, attend roundtables, and other events. As a result, I have very little time to devote to "extracurricular" activities and, therefore, have to pick and choose these commitments very carefully.
So when Dennis Carey of Spencer Stuart and Bob Mittelstaedt of Wharton, the founders of the directors' Institute, first approached me to request my participation in the November 1997 program, I was a bit hesitant. But because I had established relationships with both Dennis and Bob, I agreed to participate-and it was indeed fortunate for me and for Hewlett-Packard that I decided to go. The Institute turned out to be the best way to learn by doing, but without risking the kinds of mistakes that can be fatal to a real company. The Directors' Institute program required a full couple of days, during which the other participants and I thought about nothing but governance issues. We came together as board members of a fictitious company, MegaMicro, Inc.-which came complete with its own financial objectives, business units, annual report, industry analysis, and so on-and discussed, debated, agreed, and disagreed on any number of issues related to the future of the company. (See sidebar, page 40, for details on the program.)
Just getting out of the cocoon of my daily routine and going through the exercises allowed me to open my mind, to be exposed to some best practices, and most importantly, to challenge some of the "givens" on my own board. And as hard as it was to imagine how the role-playing exercises would work with executives of this caliber, they were remarkably instructive.
The Right Mix
Some of our most important discussions during the session at the Directors Institute focus when having the right mix of skills among directors. Fortunately for everyone, the days when CEOs were expected to provide all the answers-and directors were expected to sit around the boardroom table nodding their heads-are long gone. In today's complex businesses and markets, it's a foolish CEO who doesn't recognize the need to have first-rate directors who want to be actively involved and can provide the expertise in a variety of areas that can enhance the vision of the CEO and the decision-making capability of the entire board.
The discussion and interaction at the Institute convinced me that if I were going to use our board to maximum effectiveness, it had to have the right skill sets. So when I returned to Hewlett-Packard, I geared up the Organization Review and Nominating Committee, which is our committee that oversees board activities, board performance, and related areas. We developed a lengthy questionnaire of 40 questions that asked directors to rate and comment on everything from what we cover in board meetings to the usefulness of the documentation sent out ahead of time to the quality and relevance of the presentations-things that are often taken for granted. In addition, we delved deeply into issues related to the composition of the board: How large should the board be? What, ideally, should its make-up be?
As a result of the feedback we got from that process, we took the top 10 highestpriority issues-those that directors had given the lowest rating to-and started to attack them. Board composition received the lowest single rating, so it was evident that the prevailing feeling among those on the board was that this was something we needed to work on. …