2012

Issue 12

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BoardWorks International
Issue 12, 2012

Why It Is Not a Good Idea for the Board to Help the Chief Executive

Boards often have around their table members who have a great deal more management (and life) experience than their chief executives. Directors are usually keen to share their experience with their chief executives. In theory, they should be a great resource for a chief executive to tap into.

Unfortunately, realising this potential is not as easy as it should be. No chief executive wants to suggest that they are not up to the job. A bigger impediment, however, is likely to be a board's own overeagerness to help. This is sometimes rationalised 'because our chief executive is young and inexperienced'. However, even boards supported by experienced and capable management teams are inclined to dive into operational matters uninvited.

Despite the best of board intentions, however, actions taken to help or protect their chief executive are usually problematic.

 

Stepping onto the slippery slope

Regardless of motive or circumstance, boards or individual directors attempting to help their chief executive to do his/her job create many potential risks. For example, these include:

This list could be extended further but the message is clear. Chief executives, regardless of their level of experience, should be expected -  and allowed  - to get on with their job. Any shortcomings (and all chief executives have them) should be dealt with separately, transparently, and on their merits.

Providing the kind of assistance to the chief executive that IS useful

If there are too many risks in providing direct assistance to the chief executive, what might constitute a better approach? The primary answer lies in an actively applied system of performance management. Components of such a system are likely to include:

  1. A clear and up-to-date statement of performance expectations. This should consist primarily of the results to be achieved (including priorities) and the situations and circumstances to be avoided (i.e. the risks to be managed).
  2. An adequate and appropriate delegation framework that ensures the chief executive has sufficient authority to take the actions required to fulfil the boards performance expectations.
  3. Assignment of sufficient resources (usually via plan and budgetary approvals) to achieve the desired results and manage foreseeable risks.
  4. A regular and rigourous performance monitoring process. This will include agreed performance measures and approaches to collecting monitoring information.
  5. Feedback. It will also include a process of continuous feedback on the chief executives compliance with the board's expectations and on his/her performance generally.
  6. Not least, it will also include sincere pastoral support, and active encouragement for ongoing professional development.

The chief executives role is very important but it is the board that is ultimately accountable for organisational performance. The chief executives job is sequential to the boards own job. Until delegated some of the boards authority the chief executive does not even have a job. Therefore, effective self-management and high quality performance by the board itself must come first. This is underlined by the nature of the first three of the components listed above.

Through a structured and systematic performance management framework the board creates a situation in which the chief executive is free (and safe) to operate. The explicit process of performance planning and delegation addresses, up-front, any chief executive performance risks the board might be concerned about. Unplanned, unexpected and uninvited interventions to 'help' the chief executive are not needed. The integrity of the boards delegation to the chief executive is protected and reinforced.

By the same token, when this system is in place, the chief executive is more likely to take advantage of the expertise and experience of individual board members. The chief executive can ask a director for help without the risk that she will take over some part of his job. The director can provide input without fear that the responsibility has ended up on her shoulders.

 

 

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