Directors need to be vigilant when a crisis isn’t brewing
– Boards should remain vigilant always, particularly when a crisis is NOT brewing.
– The world is changing fast and companies must keep innovating.
With the world changing so fast, companies must remain nimble. They must keep innovating. And the board plays a huge role in ensuring that is happening. This thought piece from Brad Feld is insightful about how the board must keep vigilant about a company’s weaknesses during those times when a crisis is not evident. When everything seems to be humming along smoothly. Here is an excerpt:
There are many points in a company’s life where the CEO and the board can either deal with or deny reality. When dealing with reality, a key factor is embracing the business, team, and individual’s weaknesses and then deciding how to address them. Collectively. With empathy and emotional support for each other.
This isn’t easy. Over the past 30 years, I’ve been in this position many times, often multiple times as a board member in a particular company. These are different than crisis moments, where everything is on the line. It’s often when many things are going well, but there are prominent areas of the business that aren’t keeping up with what’s working.
I’ve never figured out magic words to say as a board member in these moments. Instead, I say what is on my mind, take responsibility for my participation in any weaknesses, dysfunction, or challenges, and focus on where I think we need to put additional energy in improving the business.
This is often an acknowledgment that we need to add a few experienced people to the leadership team. The CEO has to drive this. When the right people are added, notable positive shifts in the weaknesses can happen extremely quickly. But, in the absence of them, the talk generally continues, without action. Reality is not dealt with – just poked around the edges.