Grow Your Business: Preparing for Board Service
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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowSurprisingly, the word “board” is derived from English country life. More than four hundred years ago, each house had a table that was made from wide boards. Some of the boards were used for eating. Others were used for food preparation. As hospitality in the English countryside increased during those times, places would offer “room and board” meaning they would provide a bed for sleeping and food to eat. Country taverns encouraged patrons who played cards to be sure and keep their hands “above board” to ensure no one was cheating. Finally, in English homes, the man of the house was provided a chair at the head of the table. He was called the “chairman of the board.”
While the evolution of the meaning of the word ‘board’ developed over a long period of time, serving on a board of directors in this current day and age is challenging, to say the least. Awareness of what qualities are needed, to be able to effectively serve, is of paramount importance for your company board and/or any other board you might join.
According to the authors in a recent article for the Harvard Business Review, boardroom qualifications, selection, and ultimate service, are not near as easy as they used to be.
Writers Anthony Hesketh, Jo Sellwood-Taylor, and Sharon Mullen go on to elaborate how overall board dynamics have changed in many ways over the past several decades. Where board service used to be the exclusive domain of white men, gender and ethnic diversity are very important, as well as selecting members who are culturally diverse and those who have different functional management skills.
Interestingly enough, however, just because a potential board member has a tremendous resume, it does not necessarily mean they have the proper set of skills for serving on a board of directors. As a case in point, the authors state “Unfortunately, the capabilities that power C-suite careers are not the same as those needed to sit around the top table, specifically in a non-executive capacity, because you no longer have all the levers of operating power at your fingertips. That is perhaps bad (but not terrible) news for obvious board candidates: they’ll simply have to work to develop the right skills. It’s unquestionably good news for non-obvious candidates— that is, those who didn’t or couldn’t ascend to the ranks of top management, which continue to be male- and majority- race dominated around the world. They will need to work hard, too, but they can start on a more level playing field.” In other words, board service is a lot easier said, than done. The authors go on to identify five types of intelligence that is needed for board service: financial, strategic, relational, role and cultural.
Financial: One board member who was interviewed by the authors stated this type of intelligence very well. “For me, the key issue is to be able to interpret an income statement and use that to understand what is going on in the business: what may be going well and not so well.”
Strategic: Another interviewee said this “Does the strategic thinking pay adequate attention to key trends and external realities? Are we being honest about our competitors’ positioning and competitive advantage? Is there a real credible link between the strategy and the projected financials?”
Relational: A key to this type of intelligence relates back to an earlier comment the authors state very succinctly with regard to board service, “The role is to scrutinize, encourage, and advise, not operate. You need to build successful working relationships with other directors, the company’s top executives and wider stakeholders, each of whom come with their own experience and opinions.”
Role: Determine what role you are to perform as part of your board service. “….where you add the most value. You can practice this in all your meetings and projects. Emulate others who bring that same precision to their work and interactions”, said Hesketh, Taylor, and Mullen.
Cultural: Concentrate on your particular gift set and ability to “read, get along with, and improve the culture of diverse groups of peers by joining cross-functional, cross-industry, and cross-cultural groups”.
At the end of the day, whether it is serving on the board of your business or another board, these five types of ‘intelligence’ should help bring clarity and result in growth for you and your future board service.