Boards and management are often polarised on the role of Boards in developing organisational strategy.
How can a group of independent Directors hope to understand the business sufficiently to drive strategy in the time available to them?
Then again, it’s clear that a good Board should be full of experienced business leaders who can add value, wisdom and insight to strategy.
Every Board will approach this differently depending on the complexity of the business, the make-up of the Board and executive and the issues on the table.
The Chairs and Directors I meet consistently express the desire to lift the level of engagement in strategy at the board table and to add greater value to the organisation. The question is, how?
A number of CEOs have mentioned that they understand that their Board wants to be more involved but are unclear about how to achieve this.
At what stage in the process should the Board be engaged? Most Directors are not clear on this themselves.
How much information should be provided? How much should management have already done?
How can CEO’s engage the Board early on with strategy without seeming ineffective or without vision?
Directors need to be mature in their approach to this. They cannot ask for upfront engagement then hold the CEO to account for ill defined ideas.
A learning approach and clear communication are required to find the right level of engagement.
A review of the existing level of strategic engagement, a collation of the issues facing the organisation, and a position on the desired level of strategic engagement should be formed.
A range of approaches to open strategic dialogue should then be considered in a consultative manner, from strategy days, to in boardroom training, to an overhaul of the Board calendar.
What is clear is that the Board and executive will need to take a team approach to this change and the use of a consultant may be useful to desentitise issues.
Open communication, review and evolution will be required to get this right but the outcome should be better greater satisfaction at the Board level, broader strategy discussion and improved dynamics between Board and management.