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Over the years I’ve been involved in more than a few searches for a new CEO, and, I have to say, it’s got to be one of the most nerve-wracking processes that a board of directors undertakes. There is just so much riding on that one decision. It’s a process that is fraught with risk – the risk of overlooking the right person and selecting the wrong person.
In recent blog posts, we’ve dealt with different takes on the board’s role in CEO succession – first, the challenge of naming an interim CEO to deal with an unexpected CEO departure, and then, managing an orderly process of long-term succession planning. With today’s post, we’re closing the loop with a deep dive into the selection of a new CEO.
In this scenario, the board knows about the current CEO’s departure well in advance – in the case of a planned retirement, for instance – and has the luxury of plenty of time to locate just the right person to be the...
Last week’s blog about Interim CEOs seemed to strike a nerve. One reader even told us “You have no idea how timely this is. I am right in the middle of this exact discussion.”
Keeping with the topic of CEO succession, I asked Alice Sayant, co-founder of DirectorPrep.com™, to share her views about the board’s approach to succession planning.
So, Scott gets to write about the controversial topic of interim CEOs, and here I am writing about the unsexy, decidedly noncontroversial topic of succession planning. How is that fair?
Why is succession planning noncontroversial? Because everybody agrees it’s a good idea – more than a good idea, it’s a key board responsibility and vital to the organization’s success. According to one source, 86% of leaders believe succession planning is an urgent or important priority. In researching the topic, I found no sources whatsoever that claimed succession...
Key person risk - by definition, it’s the risk carried by an organization that depends to a great extent on one individual for its success. From the board’s perspective, the organization’s primary dependence is on the CEO, the person through whom all good things happen! From the CEO’s perspective, the key person in the organization might be someone else - the lead revenue generator, the head of creative content, the inventor, the chief IT architect, or the morning show host.
What happens when, all of a sudden, the board’s key person departs? The CEO, the ship’s operational rudder, is gone. “What does our CEO succession policy say? We don’t have one? Oh, okay … I didn’t know that. So where do we go from here? We’d better call a meeting.”
I don’t mean to make light of a serious situation. Especially today during a pandemic, when the frequency of sudden departures of CEOs, for health or performance reasons,...
Countless times, I’ve sat impatiently at the board table waiting for another director to stop talking so I could have my turn. Needless to say, I was not really listening to what they were saying. My mind was preoccupied with my own upcoming pearls of wisdom. I know I’m not alone in this.
“Most people do not listen with the intent to understand; they listen with the intent to reply.” – Steven Covey
But if everyone is mentally practicing their own response, and no one is really listening, why are any of us speaking at all?
I’m sure we would all agree that good communication skills are a requirement for savvy directors. So what does that imply?
When we talk about communication skills for the boardroom, we often mean speaking or presenting. We think of communication as a way of sharing our ideas, knowledge and opinions with others. We communicate to influence others, advise them, or challenge them.
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,...
It feels like now is the right time to write about board diversity and inclusion. As always in these Savvy Director™ blog posts, we’ll eventually guide the conversation to how an individual board director might approach this topic in the boardroom.
This week, I asked Alice Sayant, co-founder of DirectorPrep.com™, to share her views on the topic.
First of all, let me say that I believe board diversity and inclusion are important subjects for our consideration because, if we believe in social justice, it’s just the right thing to do. If the word justice implies fairness, then social justice is the concept of fairness as it manifests in society – including equal opportunity for participation in societal and economic institutions like corporate boards.
The four essential goals of social justice – human rights, access, participation, and equity – are important personal values for me,...
I received some interesting comments in response to the last Savvy Director™ blog on the topic of resilient leadership. This one below really got me thinking about a director’s need for self-care in the face of stress and worry about the organizations they oversee.
“I hope leaders, even if resilient, do not view themselves as invincible. They and their boards have to ask themselves ... how can I stay whole? How can I help others do the same? If we do not tend our ‘own gardens’ we may find ourselves withered, dry, or simply dead. Worst of all - dead but still in the job.”
Self-care is any activity that we do to take care of our physical, mental, emotional, and spiritual health. Good self-care is key to improved mood, reduced anxiety, and positive relationships. Although I’m no expert on the subject, I do appreciate and try to practice positive behaviors such as eating well, getting my beauty sleep, exercising and meditating.
But what does...
“I can get my hair cut today!”
Hey, it's a very real thing for people who have hair available to cut. Getting a haircut is one of the early reliefs coming out of restrictions being lifted. A return to normal, something customers can control.
Your hair stylist or barber is glad to see you, and glad to be seen by you. Your stylist’s business is fortunate. As long as you have hair, I’m pretty sure you will return to your previous habit of regular haircuts.
That got me to thinking about customer behavior as our economy re-opens. The impetus for organizations to ‘change back better’ will fade if we are able to just return to the way things used to be. Is that a good thing?
As a board director, my hunch is that when returning to the old way of doing things is easy, it will stifle the recent spate of innovations and many of the creative ideas that had been placed on the drawing board. I can sense that this is already...
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...
I recently woke up at 3:00 AM with my mind racing about the upcoming board meeting scheduled for later that day via video conference.
As I lay in bed, I heard Fergus, our 15-year-old Scottish terrier, snoring away on the floor beside our bed. It would not be long before his 5:30 AM wake-up bark telling me he wanted to go outside. I needed to get back to sleep.
That day’s upcoming board meeting was the culprit that was keeping me awake. As a volunteer on a government agency board, I was aware that lots was going on. The government had announced impending funding cuts across all agencies to help pay for COVID-19 expenses. There was no clear direction to help us determine what to preserve and what to prune. The management team and the staff were understandably wary about layoffs, and we had fearful clients not knowing whether there would be funding available to continue their work.
With a board comprised of current and new government appointees, board leadership was unsure what...