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Last week’s blog dealt with board succession. If you read that post (A Better Way to Fill Board Seats), then you know I’m an advocate of treating board succession as an ongoing process of planned renewal.
Maybe you also noticed that we glossed over the whole topic of actually selecting the right director for your board – a process that is complicated enough to merit its own separate blog post.
So, let’s delve into the topic of board recruitment now.
A competency matrix is a useful tool for board succession. It helps you visualize the skills and attributes that the board needs compared to those that it currently has. It makes the gaps obvious.
But, when it comes time to make a final selection, make sure to pinpoint specifically what the board needs at this point in time, asking key questions like:
Does this sound familiar?
A long-standing, knowledgeable and well-respected director will soon be stepping off your board. This will create a vacant board seat.
Once the board becomes aware of this impending departure, a board committee is tasked with finding a good candidate to fill the seat. The committee scrambles to interview a few candidates and recommend one of them to the board.
The board rubber stamps the committee recommendation and – bingo! – there’s a new board member at the table. You’d better hope they’re a good fit because one director can change the board’s dynamics and culture – sometimes in a negative way that would have been revealed with more time and a better process.
There’s got to be a better way …
Board succession - filling board vacancies when directors step down - can be a complex, time-consuming task. There are a number of factors for the board to keep track of: the gap created by the...
In last week’s Savvy Director post, I wrote about healthy tension among board members, and the need to prevent it from deteriorating into disruptive conflicts, or resolving the conflicts quickly if they do arise.
But there’s a certain kind of conflict that arises in the boardroom that I didn’t address – one that requires finesse and sensitivity to manage. I’m referring to conflict between the CEO (often called the Executive Director in the non-profit world) and the board.
The relationship between the CEO and the board is crucial, and has a huge influence on organizational success. The CEO and the board play different roles, but they have to pull together on achieving the organization’s goals. If they’re pulling in opposite directions, the organization is at an impasse.
Mutual trust is at the core of a strong board-CEO relationship. Of course, a harmonious relationship doesn’t guarantee success, but it can pave the way, clear out...
Ever heard that one before?
Thankfully it happens much less these days. But it took an experienced director to pull me aside after a board meeting one time to help see the light.
Body language, tone of voice, choosing your words with care, and simply waiting for the right time to jump into the discussion have all made a huge difference in my ability to have influence over others in the boardroom. But not every time. I still manage to mess up when I’m not conscious of listening first or not putting myself into the other person’s shoes.
W.A.I.T. “Why am I talking?” is a helpful acronym to tuck away into your savvy director toolbox. Try using it sometime before blurting out your question or interrupting someone who is talking.
Ask yourself, “Do I really need to speak to this agenda item? Or is it just my ego wanting to hear myself talk?” Again, I’m speaking my personal truth as a director. The...
The board interview – it’s a key step in assessing the fit between a board of directors and a potential new board member. But for both parties – the board and the candidate - it’s so much more than that.
Last week The Savvy Director blog focused on the ‘fit’ – or lack thereof – between a board and potential new directors. We advised using behavioral questions to uncover candidates’ fit with the board. And we provided some questions for potential directors to help determine the board’s fit with them.
So let’s say you’ve thought hard about it and you’ve got a pretty good feeling about the fit between you and a particular board – good enough to take part in an interview, at least.
What should you expect? What should your goal be? And how should you prepare?
We’re going to try to answer those questions in this week’s blog.
Boards differ markedly in their approach to...
Relax! Having a conflict of interest with respect to something on the board’s agenda need not interfere with your ability to function as a high quality board director. It’s okay to have them. It doesn’t make you a bad person or ineffective board member. The real issue is whether your board has a good process/policy/practice to manage and mitigate any actual or potential conflicts.
Let’s get the definition out of the way.
A conflict of interest is a situation in which a director’s duty to the organization conflicts with their own interest or duties to others. A conflict of interest can come about either as a result of a personal conflict between the director’s own self interest and their duty to act in the best interest of the organization, or as a result of a conflict of duties that the director owes to the organization and to another organization. Such conflicts of...
Someone on LinkedIn said, “Good governance is like keeping the train on track.” I like that analogy as it runs parallel to the description of the CEO who ‘keeps the trains running on time.’
You need both good direction and good execution.
You also need the third phase of the board’s work – monitoring progress.
It may have been John and Miriam Carver who described the work of the board as:
In over twenty years working with boards and serving on boards, I find it’s the third step that gets dropped most often. This Winston Churchill quote says it well:
“However beautiful the strategy, you should occasionally look at the results.”
Why is looking at the results such a challenge?
Maybe it’s because evaluating the progress of not-for-profits (NFPs) lacks the clarity of stock price, shareholder value, and return on capital metrics monitored by many in the...
You’ve read the material. You’ve seen the presentation. You’ve listened to management’s request. Now it’s time for the board to make a decision. It’s an important decision, too. You’re expecting a robust discussion.
But the room is quiet. Maybe a couple of directors ask a question or two, just for clarification. Now it looks like the board chair is about to call for a vote.
What’s going on? Groupthink, that’s what. Your board has fallen victim to Groupthink.
We’ve all been there, at one time or another. I know I have. So, what can we do about it?
First, what is it?
The term was coined in 1971 by psychologist Dr. Irving Janis, following extensive research on group decision-making. His findings came from research into why a team reaches an excellent decision one time, and a disastrous one the next.
Janis found that a lack of conflict or opposing viewpoints led to poor decisions, because...
How should a board of directors be spending its time and energy? When I serve on boards, I make sure there is plenty of room on our agendas to regularly spend time on four key topics: finance, people, strategy, and risk. I refer to these collectively as The Savvy Director’s Focus.
Board directors don’t need to be experts in these areas, but we should all have at least a basic understanding of them. And so, today’s blog focuses on what a board director needs to know about risk.
For many of us, risk is top of mind these days as our organizations struggle with the impact of COVID-19. But the board's risk oversight role is not a one-time event. Thinking about risk management as a matter of course, in quieter times, gives an organization a leg-up when it comes to responding to an unanticipated event like a pandemic.
Risk is defined as the potential for uncontrolled loss of something of value. For an organization, a risk is something that could...
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 how much will we spend?
So, if the organization’s strategy is like its travel plan, what kinds of questions does it answer? Keep reading to find out.
It seems that every board of directors suffers from a time crunch. There is rarely enough time to get through a meeting agenda without rushing through the last few items. As a consequence, boards need to make sure they spend their limited time focused in the right areas.
Which areas? Strategy, people,...