Businesses often don’t see the point of holding board meetings – and so they don’t. If they do, they may see them as a necessary evil: necessary for the company to report to any investors who are represented at the meeting, for example. With that approach, any meetings are inevitably focused on the past, not the future.
However, a growing business needs direction and clarity about its future, and board meetings can be the ideal environment for ensuring the right decisions are being made.
So how do you ensure that you make use of the time you have together in the board meeting to have a more forward thinking discussion rather than day-to-day firefighting?
Make the board pack a live decision-making tool
Too often, the board pack is seen as a set of reports for the non-execs, whereas the point of the pack is to support joint decision-making. Keep it short, and give it a punchy narrative to make sure readers know what the key issues are and the decisions they will need to make in the meeting. That way, your board will come to the meeting prepared to make those decisions. This approach is often helped by having a one page dashboard of the key business indicators. These indicators will be both financial (eg margin performance, cash generation) and operational ( eg sales pipeline, staff churn). This dashboard will provide the board with a concise snapshot of business performance. The executives’ commentary can focus on the areas of under performance.
Aim for timeliness rather than perfection in the board pack
Circulate the pack at least three days before the meeting so people have time to read it. Don’t worry if it’s not perfect. Remember, the point is to give people something to think about and if necessary challenge – not to put forward a recommendation for rubber-stamping. If they need extra information, they can ask for it in the meeting – or pick up the phone beforehand. It will not be possible to make every decision in the board meeting. It is important that the executive leave the meeting with a clear understanding of what further information is required, when it can be made available and therefore the timeline for a final decision. Remember the final decision does not have to wait until the next board meeting – a board conference call can be arranged at short notice.
Run the meeting as an interactive discussion, not a presentation
Provided you keep the pack punchy, you can assume people have read it, so you don’t have to present it word for word. Instead, ask each executive to give a five-minute summary on how their part of the business is performing, then move into a question-and-answer session. This should be a dynamic multi-way exchange between execs and non-execs that, because of the preparation you’ve done, gets you the decisions you need.
Don’t let the meeting become ‘the CEO show’
CEOs are usually strong personalities who speak their minds. However, an inexperienced executive may only speak up to report on their own area, and hesitate to contribute to other discussions – which means you miss out on hearing a potentially valuable perspective. The chairman (normally an independent non-exec) should take care to ask everyone for their opinion.
Involve second-tier management
Consider inviting people like operations managers, HR managers and sales managers to take it in turns to give a short (15-30 minute) presentation at each board meeting. Non-execs will gain a more rounded view of the business, and the managers concerned will usually be grateful that their views are being sought by the board.
Your next step
At Livingbridge, we have invested in and worked with more than 100 companies. We join the board of each firm, and help make sure the board meetings are a dynamic decision-making tool to support profitable growth. To find out more, please get in touch.