It is certain that having the right experience is one thing, but getting the most of it is another. Especially when it comes to boards. Each board member needs to fulfil their fiduciary duties; however, reliance needs to be placed on individual board members with specific skill sets. And along the way, there are challenges that need to be overcome:
- Politics – Light or heavy, there is always politics. People come with agendas. Knowing those agendas and appreciating the threats and opportunities they bring are an imperative. Having a plan for negotiating around agendas is also critical.
- Culture – The last thing you need is a yes, yes culture. Boards must be free to ask the hard questions, to be heard (not just listened to) and all members need to get behind the decisions made. Your board needs teamwork.
- Capability – One of the greatest risks to good decision making by boards is an over-assessment of capability. Of the organisation’s and/or the board’s. Annual board performance reviews are important. And why not keep a scorecard on the decisions made?
According to Professor Paul Nutt of Ohio State University in his book Why Decisions Fail, the success rate on major, strategic decisions is only 50/50. Is your board doing better than that?
When a board’s experience is properly tapped, it gives the best chance to provide the stewardship needed for organisations in this fast-changing world of ours.