The higher any executive rises in an organization, the more time he or she will spend working with the board of directors. Most CEOs estimate they spend roughly 15 to 20 percent of their time preparing for board meetings, working with the board or interacting with board members individually. Yet executives get little training or guidance on how to be effective when working with a board of directors. They typically learn from watching their boss — adopting good and bad habits along the way.
This opens up an important opportunity for chief human resource officers to consider incorporating a component on working with the board into a company’s executive development initiatives. To undertake this in a meaningful way requires the CHRO to understand what frustrates many board members about the way company executives interact with them — and how different approaches can have significant and positive impact.
There are a number of factors that distinguish those who excel in the boardroom from those who just get by. Here are some of them:
Pre-reading materials: Every board presentation begins about a week before the meeting. It starts with the pre-reading materials inserted into board books or loaded onto the board portal for directors to review in advance of the meeting.
Typical board frustrations with pre-reading materials include having to wade through 30 pages before getting to the “aha” moment, overuse of industry jargon and acronyms, and receiving too much information with insufficient analysis of what it means. Board members want to see data, but it helps to provide the major headlines somewhere in the first two pages. The rest may be more suitable for the appendix.
Executives who take the time to develop well-organized board briefing documents — with summaries that hit the high points on the first page and a logical flow of thought that even directors who lack an industry background can readily follow and understand — start their board presentations off on the right foot. Organizing and streamlining the documents also conveys respect for directors’ time.
Micro-management often starts with management: CEOs frequently complain about their boards “getting into the weeds,” or focusing on insignificant details instead of the big picture. But sometimes it is management who takes them there.
For example, if an executive is launching a new product, the board needs to talk about the level of investment required, the size of the market, strategic plan, channels of distribution, whether there is management capability and infrastructure to execute the plan, likely competitive response, projected sales volumes and return on investment. They do not need to know the color of the bottles, the size of the labels or whether a squirrel or a chipmunk is a contender for the ads.
Boards can’t resist that detail if it is offered. “Oh, squirrels are the way to go!” Someone may comment. “Will it be a brown squirrel or a gray one?” Soon 20 minutes of a board discussion are lost on an issue that, in the scheme of things, isn’t relevant to the board’s decision to support and approve funding for the product launch.
The key question is: Is this something that board members should know about when making their decision? Is it something they would criticize management for if they were not told about it?
Creating constructive board dialogue: Most board members describe the balance of presentation vs. discussion time in board meetings as about 75/25. Some 75 percent of board meeting time consists of management presentations, and 25 percent is spent on Q&A and other discussion.
Directors typically would like to shift that balance closer to 50/50. Why? If three-quarters of the board’s time is spent listening to presentations, the board is largely being used as an audience rather than engaged as a thought partner on important issues facing the company. Being a thought partner for management is where board members can add the greatest value. Further, it is an aspect of the director’s role that most enjoy.
Seasoned executives recognize the importance of board dialogue. The best leaders stimulate discussion by posing questions where board input and perspectives would be particularly valuable; many include these questions in their pre-reading. While board members are always free to take a different tack, providing some thought-provoking questions for the board to consider as they review the materials or listen to the presentation is nearly always a hit — and it’s more impressive than the typical “Any questions?” at the conclusion of a slide show.
Less confident executives approach board meetings from the opposite direction: They fear that directors’ questions might trip them up and aim to simply get through the presentation unscathed. Some may try to drag their presentations out so little time remains for Q&A. Yet it is this aspect of the meeting where boards often make critical judgments on whether an executive has what it takes to discuss business issues constructively. Having a level of comfort in dialogue with the board is the hallmark of an effective executive.
Learning to listen: Every executive with an item on the board agenda needs to come into the board meeting with a well-considered point of view and present it with conviction. Then comes the tough part: Stop telling, and listen to the board.
The reason this is so difficult is understandable. CEOs and top managers spend their careers driving for results. As such, it’s difficult for many to transition from “tell and sell” mode to actively listening to their board and engaging in a constructive dialogue. Executives should be prepared to change their minds if board members raise concerns or offer alternative approaches that make sense. If not, they should stand up for their position and discuss the pros and cons of alternatives without getting impatient or defensive.
The “only one solution” approach is a related problem that many fall prey to. While executives should have conviction about their recommendations, failing to outline and discuss alternatives can be a mistake. Providing the board with a balanced perspective that includes alternatives and risks to recommendations offered typically goes further to build boardroom credibility than a hard sell.
Implications for CHROs
A workshop on boardroom effectiveness that covers these and other key factors that make a difference in board interaction can help to mitigate many of the aforementioned problems executives have. The value derived from such sessions is equally applicable to senior management with established board relationships. Incorporating a board component into professional development programs for all executives could be worthwhile. If possible, this should include some skill building in terms of pre-reading materials and boardroom Q&A.
While CEOs nearly always discuss board presentations with their direct reports, this is often quite general and consequently of limited utility. Further, the board often limits its remarks to the CEO about management presentations to generalities, such as, “That ran on a bit too long” or “That was really good.” Gathering specific feedback from directors about senior executives who are regular boardroom presenters can be eye-opening and valuable.
Consider the following scenario. A chief operating officer — viewed as a potential CEO successor — was inundating the board with too much data and regularly taking them into micro-management issues. He could tell from the blank expressions on directors’ faces that things were not going well. The CEO mentioned the problem and offered pointers, but nothing concrete enough to really be actionable.
A series of third-party interviews with board members that probed for specifics yielded greater insights: The COO learned that directors felt “steamrolled” by his lack of eye contact and laundry list of factoids. Consequently, they became disengaged. The COO also discovered that a board presentation template created by the corporate secretary — that he had been slavishly following — was in fact contributing to the problem.
With this type of constructive feedback, it didn’t take long for the COO to make some important and necessary changes to both his pre-reading material and presentation style. His working relationship with the board shifted dramatically as he adopted a new approach. The net result was a win/win not only for the COO, but also for the CEO and the board. Directors found their engagement with the COO more satisfying, and the CEO felt vindicated in his endorsement of the COO as a potential successor — something he’d become defensive about given the COO’s lackluster showing in the boardroom.
For CHROs, factoring a boardroom component into executive development is a win-win. Not only does it address a missing piece in executive development, but such initiatives can be personally beneficial to most CHROs, who regularly work with the HR committee and the board itself, and are always looking for ways to raise their own game in the boardroom.
Beverly Behan is president of Board Advisor LLC. She has worked with more than 130 boards during the past 16 years and is the author of “Great Companies Deserve Great Boards.” She can be reached at email@example.com.