Clarity at the Highest Levels® for Directors

CLARITY
AT THE
HIGHEST LEVELS®

FOR DIRECTORS

Crisis Guidance

Re/Alignment

Transactional Strategy

Litigation Oversight

Internal Dispute Resolution

Red Flags & Solutions

Business Model Re/Construction

Turnaround

NEGOTIATE THE PATH

FOR YOUR BUSINESS

BEFORE CHANGE MAKES A PATH

THROUGH YOUR BUSINESS.

PERMANENTLY

BE THE VERY MODEL OF THE MODERN MAJOR BOARD DIRECTOR

Your fellow board members are paid quite well. Does it bother you when they dismiss out of hand your concerns that they may be missing crucial flags? Does it bother you when they convey that they are above their work and have no responsibility to look at the facts like risk down at some menial level of corporate work? Does it bother you when they pontificate that they have been there "up at the top of a really big "environment," and so they know, they just know that they have considered everything, everything suitable to their stratospheric level? Do you consider that they may not be serving in the best interests of the entity? And what about the new board technologies which encourage discussions and decisions on the fly, outside the board room, directors spread out in the world where, less mindful of the gravity of their duty, their attention strays from the conference call, or the collaborative software, to the traffic, the beach, the game, the swimmer across the pool, or the drinks?

GOOD TIMES

Good times come and good times go. It is easy to get comfortable and careless with perception of one's own brilliance

and the ease of success when a rising tide lifts all boats; so too when the model really works. But it's in the good times when you must prepare against the bad, integrating the culture of the board with the culture of management and the environment of the times, to compensate for weaknesses, strategize around the cyclical and evolutionary threats, and developing a culture not of transparency alone but of critical thought and frank dialogue. The healthy board does not isolate the questioning voice as the "disruptive problem director." The healthy board looks for red flags, acts responsibly towards its need for data, and works.

Image © Eric Peduzzi.Fotolia

AND BAD

Even the good board will stumble onto times which are undeniably bad, such as now. Does it infuriate you that bad boards have reduced your company to collateral damage of their greed, arrogance and wilfullness, regardless of how Delaware courts may have excused them or may excuse them in the future? We should have known, as we did, that bad times were right around the corner when boards and their lobbyists became apoplectic over waiver of privilege. How many could have feared, or known, that such circumstances would very likely apply to them? What did the bad boards know was going on? Meanwhile, how do you cope? Look at facts, acknowledge the truth, and get your hands dirty with reality and analysis.

Image © Eric Peduzzi.Fotolia

AND WHERE DO YOU STAND ON EXECUTIVE COMPENSATION?

Does your management have you over a barrel? Does it threaten to quit if the largesse does not flow? Does your board fight over justification and exacting good performance through compensation? Do you worry about the potential for distortion, the decisions which will be made to goose profits in the short term but leave the company suffocating from the choices long afterthe compensation has been paid and executives have moved on to serve on their own boards (and hopefully not to serve time)? Where's the balance? How much is too much? Are you allowed to have a voice? How much scrutiny will you have to withstand and where will the critics force cuts? You may have a Gabelli, Icahn or Calpers calling the shots. So, where will compensation be this year?

Image © Gyula Sarudi.Fotolia

DOES YOUR CEO RUN THE SHOW? (Or the Chair or the Lead Director?)

Who's bullying now? Have you been asked, "Get behind it, or get the 'expletive deleted' off the board?" That's no way to meet the future. That's a business on the way to doom. So, how do you et the real problem out of the C-suite, off the board or out of the chair? It depends first on how bad it's been. Have they started tapping phones? If they have started acting like the Mob, it is probably time to go, probably with judicious calls to law enforcement. On the other hand, what if you have been forced to play the heavy, finding yourself with a laissez-faire board, especially one not of your choosing, which has begun the slip into self-indulgence, self-interest, self-protection and self-dealing? (How did you get stuck with this board? Note to self: Research first before going on a board. Think three times about nonprofits.) I have been there. Let's look at the dynamics, structure and the red flags of danger.

Image © Anthony Collins.iStockPhoto

YOU NEED TO MAP OUT THE COURSE

Assuming that you have a board room team which can work together responsibly and reliably and for whom vanity does not get in the way of utility, you need a critical survey. This is not to suggest a poll or a self-evaluation which can spill over into self-confirmation or self-justification, but a verifiable survey of what the business really does and how well in competition now and in the future with whom and what and how. You need an honest assessment of what red flags you have seen across the year and not only how effectively they have been dealt with, or not, but also which others or the same you see now. It's not a blame game, it's not self-flagellation; it's an examination.

KNOWING WHEN IT'S TIME: SUCCESSION

So the issue of succession has come before you. I will not say ''to everything there is a season," but there is. Sometimes it is time for the CEO to go, and sometimes it is time for the director to go.In either case, there should be a plan long before the individual is to go. What have you got, who will be going and where do you get more of the same, or better. Is it wise to staff a CEO chair or aboard chair with someone too close to the situation, or in fact, with one more CEO or academic President? These people are creatures of politics not likely to delve into the menial order of research and anlaysis or even carry open debate. Succession planning respects continuity while opening up board direction up to new perspective, innovation and fresh energy--or that latter is what is to be hoped for. All to often board direction just replicates itself. Even with fresh blood and ideas, succession can come too ill-considered and too late. Wait too long to plan succession, and eventually there will be a higher price to be paid because critical decisions will inevitably have been deferred. Don't wait.

Sigrid Caroline Schroder

(877) 462-4035

Unlike other consultants, large and small,

I don't slide you off on staff or a network.

Who you meet is who you get.

Clarity at the Highest Levels® Critical Guidance

Corner Office Confidence® See Around Corners

Reconnaissance Relativity & Revival® Develop Your Model

Clear Counsel® Special Notes for Counsel

I SPOT WHAT OTHER EXPERTS MISS.....

Dilemma & Decision

Sulgrave : Crisis Life-Cycle Management: Forecast+ Cope + Resolve+ Rebound

Sigrid Caroline Schroder - US/CAN (877) 462-4035 - Assessment & Intervention