Expansion stage CEOs are generally a pretty lonely bunch. I wrote about the lonely CEO in a recent post and then wrote about what the lonely CEO can do and what the senior management team can do to improve the situation.
Boards and board members can have a large impact on the level of support the CEO experiences, which translates into better CEO and company performance. Most of this comes from working hard to get on the same page with respect to priorities, assisting the CEO with the priorities in a way that works best for the CEO, and avoiding distracting the CEO with issues and/or opportunities that are not a current priority.
Boards can help the lonely CEO in four ways
If you are a board member of an expansion stage company and you want to have a large impact on the company while helping to support the lonely CEO, do the following:
- Get a board member other than the CEO to be responsible for getting the board to a unified point of view on priorities.
- Set priorities with the CEO that are are both clear and attainable.
- Be clear between meetings on what ideas and contacts are helpful for the current priorities and what should be put on an idea backlog for future reference.
- Ensure that the work you do with senior managers is coordinated through the CEO.
Pretty basic stuff in theory, but relatively difficult to do in practice. The remainder of this post goes into more detail on each of these points.
There are several traps to overcome to really achieving this in practice
Trap 1: Many board members like to work individually with the CEO rather than to than to work in a more team oriented manner with the CEO.
If there are several good board members working individually with the CEO, it can get quite distracting. This issue gets amplified when the CEO is also in the chairman role, responsible for pulling the board together as a team, as the CEO is the center of the board. The issue gets amplified further when the CEO does not have experience working on expansion stage boards and/or when the CEO does not have the time or inclination to make the board as effective as it can be, which can result in dysfunctional boards.
Solution: One great approach for addressing this issue is to either appoint an outside chairman to take on the board leadership responsibility or to appoint an outside lead director whose responsibility is to work with the CEO/Chairman and the other board members to help make sure that the board practices are solid, that the board works well together, and that the board gets crisp on the priorities for the company.
In my recent experience with boards, we recruited an outside chairman to one company and appointed a lead director to another company board. Both situations have resulted in more cohesive boards, which have been a huge benefit to the company, the board, and the CEO.
Trap 2: Most boards and management teams do not set clear, objective goals and/or limits for the number of goals that a company is going to take on at any point in time.
The less explicit the goals, the more difficult it is to align the team to accomplish them. The more goals a company has, the less it can really nail any particular goal, so not setting limits leads to a lot of distraction away from the several key goals that will really move the company forward.
The person that feels the overwhelming distractions the most is the CEO, who is left to feel a lack of accomplishment because the goals are not getting accomplished. This feeling is further amplified by individual board members who are not happy that their top goals not getting accomplished and communicate this to the CEO. This cycle of too many goals, lack of clarity around the goals, lack of accomplishment and negative feedback can lead to a really lonely CEO!
Solution: The fix for this is to for the CEO and board to work hard to try to agree and commit to a few really important goals for the CEO and company during the board meetings, determine how best to assist the CEO with the goals after the board meetings (including, possibly, leaving him/her alone to execute on the goals!), and then to put all of its time and attention into helping accomplish the goals.
The majority of the boards I am involved in have gotten better at doing this over time. We push the idea of goal clarity, getting locked and loaded for the year, and getting locked and loaded each quarter. Companies that have adopted these practices get success and are inspired to get even better with the practices over time with greater success.
Trap 3: A good board member leaves the board meeting, has a conversation with someone the following week, which gives the board member an idea for the company, and can’t help but send the CEO an e-mail with the idea or connect the CEO with a contact related to the idea.
Good board members offer a lot of ideas and contacts to CEOs. This can be really useful, but also can be quite distracting for the CEO, particularly when the CEO has several good and active board members acting individually.
The ideas and contacts can sometimes be scattered and the relationship between the board and the CEO can turn into one where the CEO feels that he/she needs to work on something since it was a request from a board member rather than because it is the right thing to do for the company. This path can lead to an even more lonely CEO, even though the good board members were trying to do the right thing!
Solution: The fix for this is for both the board members and the CEO to try to figure out if the idea or contact is in line with the current priorities, and if the CEO activity is a good use of time right now. If it is, then execute against it. If it isn’t, agree to put it on an “idea backlog” for future reference. A more advanced approach would be to publish the idea backlog (or multiple idea backlogs based on issue) to the entire board and senior management team in a collaborative workspace such as Central Desktop. Using an idea backlog will allow an idea to be captured without creating work that distracts from the current priorities.
My experience with this idea has been mixed. I still get excited about ideas and new contacts for the CEO between board meetings and/or meet a person that I think would benefit a particular CEO and can’t help but make an introduction. Over time, I have gotten better, but I am still sometimes a distraction to the CEOs that I work with. It helps quite a bit when the CEO says, “I will put this on the list as it is not a current priority, but it is an idea that we should look into at the right point.” This approach is great for me as it makes me feel that the idea will not get lost, reminds me that I can be distracting, and gives me comfort that the CEO is taking the right steps not to be distracted.
Trap 4: Board member working directly with the senior management team is a mixed bag for the CEO.
Good board members have the respect of the senior management team, so board members working with senior managers on particular initiatives can either really help or really impede the CEO’s management ability. Board members need to make sure that they are communicating working with senior managers in a way that is compatible with the culture of the company and the CEO’s style. It is also really important for board members who interact with senior managers to coordinate their activities through the CEO so that the CEO can ensure that he/she can continue to manage the people and the company effectively.
Early in my evolution as a board member, I was pretty excited about adding value to companies by working with senior managers directly. It took me a while to figure out that, while the work was valuable, it was causing a burden on the CEOs I was working with because it led to some confusion of who was in charge. I fixed this issue pretty quickly once I understood it by simply finding out from the CEO what the best approach was given the circumstance and then following that approach. It is an extremely easy approach to follow and it works quite well.
I am sure that there are other traps and solutions for boards working with CEOs that are not on my short list. If you are a CEO or board member and have views on this list or other ideas to add to the list, please let me know by making a comment!