Director's Dilemma March 2015

Dear reader,

Happy New Year! Welcome to the March 2015 edition of The Director’s Dilemma. To read this email in your browser, go to www.mclellan.com.au/newsletter.html and click on ‘read the latest issue’.

This month we have a tricky matter of misplaced personal brand. What would you advise a friend if their board started to view them in a less than favourable light?

Rachel is a new director. As an executive she worked internationally, became CEO and developed a $ 3.5 billion asset portfolio which generated respectable returns for shareholders. After deciding to become a professional director she gained formal qualifications in governance and was soon invited to teach for her local director institute.

Rachel joined a not-for-profit board where her international experiences would add value. She formed a good rapport with the chairman and assumed that she would also work well with his successor. After the AGM at which the chairman succession was effected Rachel chatted with a group of members and the new chairman. This gentleman discussed his experiences on listed boards. Midway through the conversation he paused and, turning to Rachel, said “Of course, I go on boards because I have a business background, not just to ensure compliance like you do”. The other men in the group all smiled and nodded as though she had just been paid a compliment.

Rachel was aghast. She had credible technical and business skills; she had now participated in several board meetings attended by the new chairman. If that was his view, how could she hope to be taken seriously as adding value in the risky strategic developments facing the company? Rachel did some research and discovered that she had, indeed, a reputation for theoretical governance knowledge rather than practical business skill. It seemed her governance qualifications were viewed as indicating a risk-averse compliance mindset.

How can she change perceptions so that she is respected for all her career achievements rather than just the governance skillset and able to influence the development of strategy on this board?

Ron’s Answer

What surprised me in this dilemma is that for a board that appears sophisticated enough to plan their succession of the Chair's position, it appears they have either not asked for Rachel's resume or they have all failed to read it. In doing your due diligence prior to joining a board, surely you would want to supply your resume, professional background and qualifications as part of your application to the Board.

What there is also a little ambiguity around is whether or not the Chair was already on this board, or has been appointed from outside and so hasn’t worked with Rachel. This would add some clarity to either a shortfall on the Chair’s part to not have properly researched the members of his new board, or on Rachel’s part to have not supplied the appropriate information.

Alternately, if we assume all of the above to be untrue, then it is perhaps Rachel’s focus in board meetings that has created this perception. In this case, she needs to up her level of input in board meetings to the ‘business’ based discussions whilst retaining her level of focus on risk and compliance. And perhaps a private ‘fire-side chat’ with the new Chairman along the lines of “Were you aware of my business background prior to switching over to becoming a non-executive director?” might be of benefit.

Ron Browne GAICD is Manager of Professional Development at Clubs NSW. He is based in Sydney, Australia.

Julie’s Answer

Not for profit boards are socially sensitive places. If Rachel had good rapport with the former chair she should seek his advice. He could talk with his successor, and other friends on the board, to find what has caused this perception.

Rachel could also check among directors and peers from her executive days to see what they think. She needs hard evidence: and she needs to get it without appearing to criticise or complain.

Rachel should go over the papers of board meetings she has attended and list contributions she recalls making on each topic:

Most boards have some areas where they depart from the ‘plain vanilla’ governance recommendations. They usually have good reason to do so. Has Rachel frequently queried the decisions this board has made on its governance arrangements? Are the arrangements in need of change or can she accept them and see how they work before commenting further?
When discussing issues has Rachel started from the strategic imperative or from the compliance / control perspective? Is compliance in need of urgent intervention or can she change her questioning to emphasise strategy more than compliance?
In talking with her colleagues has Rachel spent more time on the (to her new and interesting) topic of governance or on the international business and strategic issues this board must overcome?

I don’t suggest that Rachel cease to advocate for good governance; she must do that - in correct proportion to building strategic success.

Hopefully, with some support from the former chairman and some mindful management of her own interactions; she will be seen by her colleagues as a valued strategic contributor.

A good mentor would help. Rachel should seek one who can advocate for her and build her experience until she is fully confident in her role and chosen focus.

Julie Garland McLellan is a practising non-executive director and board consultant based in Sydney, Australia.

Stuart’s Answer

Insight into how you are perceived can be invaluable in helping you improve your ability to influence others, despite how uncomfortable it may make you feel. Having a good handle on reality is a great step towards obtaining an outcome that best suits you.

So for Rachel, maybe she could reflect on what she wants from the board position and what she wants to bring to the board position. With clarity on these two issues she can come to a decision on whether she should stay and find ways to work with the New Chair or to apply her skills elsewhere where they may be more recognized.

If deciding to stay and change perception of her skill set. She could try some of the following:

Be confident in what business skills she has, nothing makes someone question your skill more than self-doubt. As was pointed out above: be herself -- that’s what makes her unique!
Talk to the New Chair telling him how she was surprised at his perception of her, and explain how she thought she was on the board because of her work in building a 3.5 billion assets portfolio.
Have a clear intention before each meeting to provide input on those areas which will display her business skills, talking to her experience, and backing away a little from the compliance area.
Listen and ask good questions -- the right question at the right time can reveal more about your business skills than a vociferous opinion.
Observe the New Chair’s approach and perspective, try and see how he views things, what appeals to him, what makes him tick. This way she may be able to frame things in a way that best works for him, thus improving influence.
Build relationships with other board members, weight of numbers can work in your favour even if the Chair isn’t supportive.
Ultimately, play the long game, don’t get too focused on trying to impress the New Chair, Chairs come and go. The key is building her reputation beyond compliance and focusing on and utilizing her business skills more broadly.

Stuart Barnett is a Thought Partner and Executive Coach based in Brisbane, Australia.

What's new

Presenting to Boards – I am continuing my tour of Australia with the ‘Presenting to Boards’ training program. There are still a few places left in Melbourne, Sydney and Brisbane (not Perth, alas – you will have to wait for the next one). For details of a course near you please see https://www.konnectlearning.com.au/system/wp-content/uploads/2014/10/Presenting-to-Boards-Masterclass-0215.pdf. One of the most persistent sources of dissatisfaction in board and governance reviews is the quality of reporting to the board. This course guarantees a measurable improvement.

Inspirational quote for March - This month my favourite quote is:

“The common question that gets asked in business is, 'why?'
That's a good question, but an equally valid question is, 'why not?'”

~ Jeff Bezos ~

Book review – The One Team Method by Peter Strohkorb.

This book starts with depressing case studies of a problem most directors are painfully aware of: silos between departments that should collaborate. It provides a useful summary of symptoms which will assist in formulating questions at board level and developing KPIs for monitoring improvement strategies.

The most valuable knowledge contribution is the section on trends that are reshaping the sales world. I have read technical papers on e-commerce driven evolution of the ‘buyer’s journey’ but never one as clear as this.