Effective Board Management

Jeremy Woan, CEO of the Bampton Group, discusses how to get the most out of your board.

Appointing skilled and knowledgeable board members can be a vital component in a company’s success. To get the most out of your board members, however, it is important that the company’s Chairman provides an effective forum in which the board can function. That forum is the board meeting.

If you are a CEO, you may feel your life is a lot easier if the board meeting is used merely as a mechanism for rubber-stamping your plans and actions! A CEO’s life should not be quite that comfortable, and if that is all your board does - you probably need some new board directors!

An effective board should be a key element in setting the strategic direction for the company, a goal that can only be achieved if it continually keeps a critical eye on the company’s strategy, operations and business environment.

Having gotten that off my chest, I want to focus on the keys to effective board management:
Organization, Information and Dialogue.

Organization

Good board members are generally busy! In fact, believe it or not, some board members’ schedules and workloads are just as hectic as those of the company’s management! So the further in advance you plan and stick to board meeting schedules, the greater the chance of having everybody
available to participate fully. Arrange the date and timing of individual board meetings in advance for at least each six months - and make changes to that schedule only where absolutely necessary.

Establishing a regular routine allows board meetings to become far more effective and also helps with the orderly management of open and constructive discussion. It is also a good idea to have a consistent format so the board members have a general understanding of what will be
covered - and the order in which things will happen.

Another major goal should be good timekeeping – an extremely rare commodity! We’ve seen too many board meetings where almost three hours were devoted to the first two agenda items and about ten minutes to the last four! If all board members know the meeting is scheduled to begin
and end at certain times, and the Chairman manages this consistently, the chances of an orderly meeting that effectively covers all agenda items increase dramatically.

Dialogue

Research suggests that one of the main reasons for failed marriages is a lack of communication. As a CEO, lack of communication is also a good way to get a divorce from your board and your company! It should be remembered that the CEO reports to the board, and if the board is not getting the information it requires, it has the power to replace the CEO. Good communication can help avoid this problem!
Effective communication can allow a board to function as a collaborative team. The Chairman’s role in maintaining the collaborative environment is in ensuring that all board members feel they participate equally in dialogue with him/her and the operating management.

Obviously, some individual relationships will become stronger than others, so the Chairman/CEO must see there is a regular dialogue outside board meetings between management and board members.

Information

A good board wants to help ensure the company’s success and assist the management in dealing with problems promptly and effectively. The more a management keeps board members in the information loop the easier it becomes for them to contribute properly.

It is also essential to provide open and even information to ALL board members to avoid any sense of alienation between management and board. The positive reason for this is that better-informed people can provide better input. The ‘negative’ reason is that, I believe, where a company
encounters obstacles and problems board members who feel fully informed are more supportive of management than those who have been surprised with the bad news.

Some suggestions for board member briefing packs are covered below. As a starting point, board members should be provided access to the same level of information as if they were part of the operating management team. If
the board feels too much information is being circulated it can decide to limit it but this becomes a decision of recipient not provider and fosters the sense that management is happy to inform the board as fully and frequently as members want.

Managing The Board Meeting

Ahead Of The Meeting

We’ve heard the cry from CEOs – “ I don’t have time to prepare for all these board meetings!” We don’t have much sympathy with this complaint, although we do believe the need for board members to receive as much
information as possible must be balanced against the other demands on management’s time. However, we believe the compromise is far easier than is often suggested and my approach is always to produce internal management reports in a sufficiently readable and meaningful format so that they can also be used for board purposes.

Ensure each board member receives the board meeting information pack well ahead of each meeting. This package should contain:

Minutes of the past board meeting

Agenda for the upcoming meeting

Regular management reports that are made available to board members

Particular briefing papers for that meeting

Each board member should also be contacted a few days ahead of the meeting to confirm their attendance and, if for some reason they are going to be unavailable, whether they can participate in the meeting via conference call. This contact also serves as a good reminder to board members to
review all papers ahead of the meeting.

Standard Agenda

A typical standard meeting agenda might look as follows:

Roll call of members present

Review and approval of minutes of the previous meeting

Review of action items outstanding from the previous meeting

Management reports

Strategic and operational issues/reviews

Review of new action items

Specific items for the upcoming meeting

Confirmation of date, time and place for next meeting

Close of meeting

During The Meeting

The Chairman’s goal here is to allow open and constructive discussion while allowing the meeting to flow in an orderly and timely fashion. The Chairman should also enforce a reasonable adherence to the agenda, reserving discussion for different topics to their appropriate point in the meeting.

Throughout the meeting the Chairman should make sure that any action items agreed are properly recorded and assigned to the responsible party.

The Chairman should close the meeting by confirming the time and place of the next one and be careful to check that no board member has unsaid comments or issues that have not been allocated a slot in future discussion.

It will no doubt have been noted that we’ve assiduously avoided talking about conflict resolution! That subject will be reserved for another article.

After The Meeting

A few days after the meeting it is useful for the Chairman (and the CEO separately if these roles are held by different people) to follow up with each board member to get their opinions and feedback on the meeting. This not only helps to prevent issues or comments festering between meetings but also fosters the concept that although the board meeting is the forum in which the board operates, the information flow and relationship between management and board members is a continuing and regular one. Depending on the frequency of board meetings, I would also strongly recommend that the CEO take the time to call each board member every few weeks as part of this process.

The Author:

Jeremy Woan has successfully built and taken public two companies and served as Chairman and CEO of a publicly traded company as well as being Chairman of a number of private company boards. He is presently CEO of the Bampton Group, a management consulting and brand management firm with offices in San Francisco and London.

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