If there’s one key to building better boards and unlocking the hidden value of your steering committee, it might be the realization that there is no one key. The purpose of a board of directors is to build a team with a collection of skills and experience in your field that is as deep as it is wide. You want members with unique and valuable talents and skills and rich insights. But the most important thing is onboarding members who are selflessly dedicated to the cause, members who are more interested in serving the community than themselves, and who have proven it over the course of years.
Admittedly, this is not an easy task. What’s more, it would be unreasonable to expect anyone to be entirely selfless. Such people may not even make the best board members. After all, you want to be able to reward hard-working members, and totally selfless people are hard to reward effectively. So our team of board optimization experts sat down to put together this brief guide to getting the most out of your management team. We’re sure at least one of the following tips will prove useful to you in the coming year.
Building the ideal board for your industry, your local and regional economy, and your culture is one of the most challenging things an executive could do. It’s the kind of goal you might even create a team to accomplish. But rather than doing that, let’s focus on developing a better strategy.
Some executives compose their boards entirely from investors. This has the side effect that those who invest expect to be given a seat on the board. This is unhealthy. Your seat-holders should be ready and able to perform. They should not expect to receive their seat as a reward for investing. If this has been your organization’s tradition, it will need to change, and that can take time.
The best way to run a successful board is to empower it with effective leadership. An experienced chairman who has proven his or her dedication to the organization and your cause will hold members to a higher standard. Your chairman should be able to serve as a coach for other members. For this, deep experience and passion are necessary.
Communication should be a two-way street. Members should feel free to express concerns and share insights. At the same time, some form of pressure to express themselves constructively should be in place. Nevertheless, the best ideas come forth and thrive in an environment where ideas themselves compete for dominance. Therefore, it is in your best interest to ensure members can express their concerns and ideas fully.
It’s axiomatic that bigger is not necessarily better. However, if you know how to select valuable members, then more of them just might be a good thing. After all, more seat-holders means more hands actively seeking investors. This does not mean you want to fill more seats in any way you can. It means there’s no such thing as too much effective talent.
We’re all familiar with the analogy of the monkey who cannot get his hand out of the jar because he won’t let go of the banana inside of it. Be ready to let go of short-term gains, or even windfalls, for establishing lasting revenue channels and long-term advantages.
It makes sense that a seat on the board is attractive. But those who seek a seat merely for self-advancement are poison to your cause. Board members should place the cause and/or the organization first. For this, prospective members should have some form of track record proving their dedication to the cause.
Depending on the nature of your organizational culture, setting quotas may or may not be a good idea. However, some performance expectations should be set forth. Furthermore, members should be expected to conduct themselves in a way that reflects well on the organization.
Finally, there’s nothing more corrosive to collaboration than meetings that feel unproductive or needlessly repetitive. Make certain your agendas are crafted sparingly, covering concerns that need covering. Like a bonsai tree, your meetings should be trimmed judiciously. Respect the time and energy of your seat-holders, and do not erode their enthusiasm with bureaucratic repetition.