During the month of my 45th birthday, I participated in five board meetings — two nonprofits and three for Venture Capital — or Private Equity-backed tech companies. I got an early start in board work as I was thrust into the CEO role for a tech company in crisis in my 20s. In the years that followed, I participated as management (presenting to the board), chairperson, or board member in over 300 meetings.
Some of the boards were toxic, in turmoil and in desperate need of refounders. Some were highly collaborative, high-functioning and occasionally even fun. We have all experienced these team dynamics in one form or another. But one thing was true for all of these boards: They all started for a reason. There was a funding event or maybe a crisis, a search for wise counsel, a change in ownership or a need to expand the circle of influence. But then, over time, things changed. The members of the board became too polite or too rude. Financial outcomes became the sole focus, or worse yet, the board over-indexed on just having fun. Regardless of the reason, so many of those boards didn’t fit the needs of the company and shareholders anymore.
There’s a predictable cycle to company boards. Initially there is a sober focus, a true desire to look at hard realities and big ideas. Then, a targeted focus on some initiatives — KPIs and WIGs. Next, a tug-of-war, exacerbated by persistent confusion about leading and lagging indicators. This can lead to misalignment (often unspoken) of incentives, creating stagnation at best and endless iteration at worst.
After an initial bolus of energetic board gatherings, a cycle of mediocre meetings ensues. Management plays kill the clock — the game of way too much content for the time provided. Board members are complicit, frequently asking for additional areas to measure and new reports to be provided “at the next meeting.”
It’s endless. All parties know something is off.
When boards and companies enter this phase, two paths emerge. They can engage in audacious dreaming and massive scope creep through unceasing questions, optionality and potential paths, or they can employ discipline and stay focused on a strategic set of near-term deliverables for a longer-term win. Often, to pursue the latter (and better) option, real and temporarily uncomfortable change is needed.
The best practices of refounders apply to boards, too —predicting when change is needed and course correcting applies to all areas of the company, board of directors included. This can be a taboo subject, but the best-performing companies proactively evaluate the culture and performance to ensure alignment.
At times, board members and management each play into this cycle, distracting the company from its goals. But why? Over the next three articles, we’ll take a closer look. For now, ask yourself:
* Is the board meeting we attend more focused on tactics or strategy?
* Do meetings leave space for the free-flow of ideas and discussion?
* Is the management team over preparing?
* Are directors continuing to add a new report to the deck each meeting?
* Are we skirting around a serious or consequential issue?
