The Savvy Director Blog

It’s important for an organization to have clear goals. Goals are where the organization wants to end up, but it needs a strategy to get there. If the goal is the destination, then its strategy is the travel plan.

When faced with a fork in the road, a travel plan answers the question Which road should we take? And it answers many other questions too, such as Which routes will we avoid? What vehicle will we use? How fast will we travel? Who will navigate? Who will be along for the ride? And ho...

The question posed above by my finance professor in business school may be one of the most impactful lessons of my university education. Not sure why, except maybe to suggest that his question really hit home.

The question was pretty much a side comment to the discussion that was underway at the time and I’m not sure it resonated with others in my MBA class. But it did resonate for me. I was not even into boards yet, so, it wasn’t about that. Nonetheless it’s a powerful question I’ve brought ...

There are no HiPPO’s in the boardroom, are there? Yes, there are when HiPPO stands for “Highest Paid Person’s Opinion.”

The HiPPO effect is when the highest paid person’s opinion carries more weight than anybody else’s in the room. That’s because we subconsciously endow highly-paid people with a degree of authority that they don’t necessarily deserve. It’s human nature to believe they are smarter, savvier, and more strategic than the rest of us.

In a boardroom context, the HiPPO is probably...

Most of the available advice about how to improve reports for the board of directors is about content from the senior management team – reminding us that, even though it’s easy to point the finger at management for voluminous reports that are painfully dense, the board itself is accountable to ensure it receives the information needed to fulfill its role. If you, as a director, aren’t happy with the form, length, style, and content of your board’s management reports, go ahead and raise the iss...

Organizations are becoming more and more dependent on third parties to provide the services they need to stay in business – from IT to accounting, from customer service to HR, and more. And the more we rely on third parties, the more important it is to evaluate and manage our exposure to associated risks.

The board of directors plays an important role by ensuring there’s a focus on effective third-party risk management before problems arise from the increased risk exposure.

What do we me...

Whether your board serves a non-profit that competes for funding or a business that competes for market share, having a sustainable competitive advantage continues to be the holy grail.

Your competitive advantage is what you do better than anyone else. If you’re lucky, you could have more than one such advantage. The ‘sustainable’ part of the phrase refers to the ability to continue doing those things better than anyone else over the long term.

Does the board of directors have a strategic ro...

For me, reading and learning about artificial intelligence (AI) has been like drinking from a firehose. I could choose to ignore it and get a nice glass of water from the filtered jug in my fridge. But that wouldn’t end well.

Instead, I’ve been learning that boards today aren’t yet seeing AI as an important education topic for their meetings or board retreats. There’s some curiosity around ChatGPT, but otherwise little sense of urgency. In my view, that’s a mistake.

Does it get your attenti...

Businesses naturally progress through different stages as they grow and mature. So do non-profit organizations. Their boards of directors need to change along with them, otherwise there’ll be a serious mismatch between what an organization needs from its board, and what the board can actually deliver.

As a board moves through these stages over time, it requires a changing set of attributes and competencies from its members. As a director, you’ll be more engaged and more satisfied, and you’ll ...

Every board of directors depends on a stream of reliable information to fulfill their oversight role. A whistleblower program is a tool for directors to access information that would otherwise not reach the boardroom.

Whistleblowers give the board a window into what is happening inside the organization. But for whistleblowing to work properly - so that both the whistleblower and the accused person are protected – the program must be handled with care. The board plays an important role in esta...

 

The COVID-19 pandemic is finally receding into the rearview mirror, and so is the crisis mindset that affected so many organizations around the world. Board directors everywhere are eager to get back to a more “normal” rhythm.

While this kind of global health crisis is rare, it’s a good bet that sooner or later every organization – private, public, non-profit, or government – will face some kind of crisis. Getting through it will take skill, commitment, and judgment on the part of both the ...