board role in strategy a joint strategy and governance sig meeting
TRANSCRIPT
BOARD ROLE IN STRATEGY
a Joint Strategy and Governance SIG meeting
GOAL
The importance of board oversight of strategy is clear, but finding an effective oversight approach can be challenging. There is a balance to be struck between board and management roles.
With the guidance of the article “How Strategic is Your Board”, attendees will learn about the use of a framework for establishing the appropriate role.
OUTLINE
The discussion will be in three parts:
1. A review of the article “How Strategic is Your Board?”
2. An exploration of key themes presented in the article by an expert panel.
3. Q&A with all participants, perhaps focusing on how management consultants can constructively add value.
“HOW STRATEGIC IS YOUR BOARD?”Didier Cossin and Estelle Metayer
MITSloan Management Review
September 16, 2014
http://bit.ly/1LZD8Vy
PROCESS
Three strategic dimensions:
1. potential roles for a board
2. defining “strategy”
3. the context of the company
ROLES FOR A BOARD
Three roles.
1. Supervisor – the board monitors performance
2. Co-creator – board is a partner
3. Supporter – the board is removed, objective
DEFINING “STRATEGY”
1] as planning. Vision, mission, values and purpose.
2] as redefining the competitive domain. e.g. Staying ahead of major market changes.
DEFINING “STRATEGY”
3] as a focused response to overcome a key challenge. e.g. A rapid change in commodity prices.
4] as identifying and reinforcing core competencies. Changing approach as market needs change.
DEFINING “STRATEGY”
5] as optimizing the value contribution to stakeholders. Re-focusing on the customer.
MAPPING THE BOARD ROLE TO “STRATEGY”
CONTEXT
Four contexts in which a company operates*.
1. Simple
2. Complicated
3. Complex
4. Chaotic*David Snowden, Mary Boone 2007 - http://bit.ly/1XQVQuG
CONTEXT
Simple contexts are stable.
Clear cause-and-effect relationships are easily discernible by everyone.
CONTEXT
Complicated contexts may contain multiple right answers.
Not everyone can see a clear relationship between cause and effect.
Analog: a Ferrari.
CONTEXT
In a complex context right answers can’t be ferreted out.
Analog: the Brazilian rainforest.
CONTEXT
In a chaotic context, cause and effect shift constantly.
Manageable patterns are obliterated by turbulence.
MAPPING THE BOARD ROLE TO CONTEXT
Q&A PANEL
1. The article suggests that the starting point is to identify the organization’s meaning of strategy. It further suggests that a consultant might start asking each board member for their individual view and tallying the results. What are your thoughts on this approach?
Q&A PANEL
2. How important is it that board members agree on the extent of involvement appropriate for the board? What approach should an advisor take in dealing with conflicting views between board members?
Q&A PANEL
3. If the CEO is going to invite more director involvement, what ground rules might we as consultants propose to ensure board engagement is timely and constructive, and does not frustrate or perhaps even demoralize a hard-working management team?
Q&A PANEL
4. The article argues that the needed degree of board involvement correlates strongly with the complexity of the context. How do the boards that you have consulted with demonstrated an ability to add value in periods of chaos?
Q&A PANEL
5. Does a board typically turn to consultants during these times? If so, are there any particular methodologies you deploy – or training that you instill – in assisting a board become more involved in times of growing complexity or instability?
Q&A PANEL
6. Are boards typically responsive to advice that they become more involved, or become more hands-off? What can be done to facilitate needed change?
Q&A PANEL
7. The article suggests some circumstances where a board should focus on key performance indicators for strategy. Are there some useful metrics a consultant can advise?
Q&A PANEL
8. The article suggests some circumstances where a board should focus on key performance indicators for strategy. Are there some useful metrics a consultant can advise?
DIDIER COSSIN, PHD (AUTHOR)
Director of the IMD Global Board Center & Professor in Finance and Governance
IMD Business School
Formerly a Fullbright Fellow at MIT
Two-time Derek Bok award winner while at Harvard
Formerly a professor at HEC Lausanne
https://ch.linkedin.com/in/didier-cossin-3175908
ESTELLE METAYER, MBA (AUTHOR)
Board member
Ubisoft, France
BRP, Quebec
Ricardo Media, Quebec
Zag Bank, Calgary
Adjunct Professor
McGill University
https://ca.linkedin.com/in/estellemetayer
https://twitter.com/Competia
ALLAN WILSON (PANELIST)
Allan Wilson is a management consultant who works with the owners and managers of technology-based companies. The objective of this work is to develop and implement plans leading to profitable growth.
In February 2013 Allan Wilson and Associates was listed as the number one consulting firm for SME technology companies in the Backbone 200 report.
HAROLD M. SCHROEDER (PANELIST)
Harold Schroeder is President of Schroeder & Schroeder Inc., a Toronto based firm of senior program and project managers, management consultants, and corporate managers.,
Mr. Schroeder is an experienced Management Consultant and Strategic Project Manager representing over a quarter century of experience working with Boards, Executives and senior management in both public and private sector organizations. He has been instrumental in building organizational capacity, developing staff, achieving accountability, and delivering on organizational transformation results.
His educational background includes an MBA, a M.Sc. in Health Administration; a BA in Psychology and a B.Sc. in Biology. His professional designations include: Fellow, Certified Management Consultant (FCMC); Project Management Professional (PMP); Certified Human Resource Professional (CHRP); Certified Health Executive (CHE); and holds a “Secret” security clearance with the Government of Canada.
KEN SMITH (PANELIST)
Ken has practiced as a strategy consultant for over 25 years, beginning with McKinsey & Company and later with SECOR Consulting, Canada’s leading strategy boutique, where he was a Managing Partner. He now practices independently with a focus on corporate development and the board’s role in strategy and M&A.
Ken is a director of ACCERTA, The Arthritis Society and the M&A Leadership Council (US), serving on strategy, HR and governance committees. He is a former director and Chair of SECOR Consulting, and past-Chair of the Ontario Chapter of the Institute of Corporate Directors. He has been an advisor on matters of strategy, M&A and governance to corporate and crown boards.
Ken has written extensively on strategy, M&A and governance, including articles for the Harvard Business Review, NACD, ICD and CPA Canada, and his book “The Art of M&A Strategy” with Alexandra Reed Lajoux for McGraw Hill. He teaches M&A occasionally as a sessional instructor in Rotman’s MBA program and assesses M&A training programs for the M&A Leadership Council in the US.
MICHAEL WERNEBURG (FACILITATOR)
Michael finds risk work fascinating: in seizing and protecting strategic initiatives; in assuring a culture of accountability to improve the consistency and excellence of product and service; or in dealing with emergent risks such as “cyber” crime.
He is a member of the board of the Society of Information Risk Analysts, an organization formed to shift the conversation from “security” to evidence-based decision making.
Contact: [email protected]