The primary role of a board of directors is to make decisions.
There is a wide range of decision-making processes that you should require your executives to apply before they submit recommendations to the board.
Nonetheless, boards will often be forced to make decisions with flawed or incomplete information. In addition, there are some bad habits that will stop boards from making the best decision within the constraints of information available at the time
It is important to be aware of these and to build good practice into board processes.
Groupthink arises when the desire for consensus overrides realistic appraisal of alternative courses of action; it is the result of a culture that prevents contradictory views from being expressed and subsequently evaluated.
Look out for groupthink on boards with similar backgrounds, norms and values and/or a history of making similar decisions.
Directors are, almost without exception, intelligent, accomplished and comfortable with power. But you put them into a group that discourages dissent, they nearly always start to conform, and the ones that don’t often decide to leave.
Head hunters looking for potential directors, and appointment committees will often ask, “Is this fellow a team player?” which is code for “Is this person compliant, or does he make trouble?”.
To avoid groupthink, start by recognising the value of independent-thinking independent directors; appoint them and encouraging challenge at board meetings. Ensure that it is standard practice to ask ‘Devil’s Advocate’ questions before each decision is made.
In the 2006 case of the US Government vs. Enron, the presiding judge instructed the jurors to take account of the concept of ‘wilful blindness’ as they reached their verdict about whether the chief executives of the disgraced energy corporation were guilty.
It was not enough for the defendants to say that they did not know what was going on; that they had not seen anything. If they failed to observe the corruption which was unfolding before their very eyes, not knowing was no defence.
The guilty verdict sent shivers down the spine of the corporate world.
Extreme examples might also be the tobacco industry and climate change deniers.
On a smaller scale, what might be some of the things that you might be subconsciously avoiding? For example, the impact of new technology, changes in the market or bad practice in the workplace. Think of the #MeToo movement.
Again, introduce the practice of asking “What might we be avoiding; what is it we don’t want to admit?”
Blind spots are slightly different. A blind spot is something that you seem unable to understand or to see how important it is. For example, a board might be completely ignorant of strategically important issues or of problems caused by outdated assumptions and interpretations. It might arise from prejudice or outdated thinking, but it is not an act of avoidance.
Bind spots can be avoided by ensuing that directors and boards are exposed to new thinking and developments; wide reading, attending conferences and presentations from experts.
Ask “What might we be unaware of or failing to see?”
Confirmation bias arises from the influence of desire on beliefs. It is the tendency to search for, favour and recall information in a way that confirms your pre-existing beliefs or hypotheses.
When people would like a certain idea/concept to be true, they stop gathering information when the evidence gathered so far confirms the views what they want to believe. Once they have formed a view, they embrace information that confirms that view while ignoring, or rejecting, information that casts doubt on it.
It should be good practice to include a Devil’s Advocate session before any decision is made. “What evidence could we find in order to prove the opposite?”
Anchoring bias is a result of jumping to conclusions, of being influenced by the first idea presented, being impressed with the idea and basing your decision on that rather than considering all the other information.
For group decision making, it is crucial to obtain information from each member in a way that they are independent.
Once again, the challenge is to be aware of the danger of anchoring bias and to include a process to ensure each idea is examined on its merits.
Overconfidence can cause directors and boards to place too much faith in themselves and their knowledge and viewpoints, and allowing this to get in the way of collecting and considering independent information.
Overconfidence can lead to taking unnecessary risks.
Each of these habits is a form of laziness, leading to sloppy decision making. By being aware of them and introducing specific ‘stop and check’ processes, boards can ensure they address issues competently and professionally so that they can be confident of making the best decision within the constraints of information available at the time.
It is useful to review decisions later. “How did we make the decision? Did we take account of all the information and advice available at the time? What can we learn from how events actually worked out?”
Many years ago I was a director of a small engineering company developing an innovative public transport system.
The company and the product had been created by an inventor.
Unfortunately, although he was indeed a talented inventor and a competent engineer, he fancied himself as chief executive. This was not his strength and the company suffered for it.
One of my heroes is Alec Issigonis, the creator of the Mini car. He was in a similar position but had the wisdom to refuse to join the Austin Morris management hierarchy – and the world has benefited as a result.
I could also be in such a position, having successfully developed and delivered programmes for teaching coaching and corporate governance/director development.
There has been plenty of good feedback about the structure of the programmes. Structure is my strength.
The question I have asked is, “Could this be delivered without me?” The delegates definitely benefited from the depth of my understanding of the theory beneath it.
However, my next question was, “Should this be delivered by me?”
I love teaching but there are others who are naturally better at it than I am. I believe that I am particularly good at facilitation and that this is because of my ability to structure the process.
But, whereas structure in facilitation is dynamic and must be held in my head throughout an event, the structure of a workshop is held in the trainer’s notes and the delegates workbooks.
There is value in keeping hands-on experience but for many managers and entrepreneurs there is danger of holding on too tightly to that which we know best. This is not necessarily the best use of talent, and it can limit progress and frustrate the development of other staff.
When I met Deepak Chopra some years ago he told us about happiness. Apparently, we are programmed to naturally complain, or to see opportunities.
50% of this programming is determined in the first three years of life, though it can be changed with time and application.
The other 50% is more directly under our own control. It depends on our conditions for living – do we have enough, or, rather, do we believe that we have enough?
What voluntary choices do we make; how do we obtain personal pleasure; how do we achieve meaning and fulfilment; what is our purpose; how do we express our creativity?
He suggested that we could increase our sense of community by attending organised events, connecting with people with shared passions and volunteering for four hours a week.
Later I listened to a Buddhist talking about karma. We create our own karma, he said. An act can become a habit. Habit can form character and character influences destiny.
So, start with small changes …
You can be a director and a manager in the same organisation.
It is really important to recognise that these are different roles: you must act as two different people.
If you are a director and not a manager in the same organisation, then you have to understand the boundaries between the board and the management.
Directors direct – and managers manage!
Nonetheless, the board is responsible for the management’s actions and performance.
The board remains responsible for overall governance. This includes ensuring senior management establish and maintain adequate systems of risk management and that the level of capital held is consistent with the risk profile of the organisation.
So, the board needs to have a clear strategy of what to delegate to management and how to monitor and evaluate the implementation of policies, strategies and business plans.
The responsibility to act and decide upon matters for action in between meetings of the board may be delegated to an executive committee.
In general the board will delegate the management of the organisation to the Chief Executive Officer (CEO) or Managing Director (MD).
The CEO/MD is responsible for delivering services according to the strategic plan, within the policies and budgets approved by the board. A team of managers oversee the day-to-day operations of the organisation under the general direction of the CEO/MD.
Delegation to the CEO/MD
Here is an example of a board delegating authority to the CEO/MD over the day to day management of the company, its subsidiaries and their respective operations. This delegation of authority includes responsibility for:
Does your organisation have a clear strategy for delegating authority to management, including reports and measurements that enable the board to monitor performance?
When I have been training with Larry Gilman, one of his techniques was to get the whole room to support the person on the stage.
Larry has a knack of helping people discover latent feelings from the past. Very often these might be emotions of anger or resentment against another party; maybe someone who has since died.
He encourages them to verbalise and state their feelings in a way that they were unable to do at the time. What he then does is to get everyone in the room to shout out the same anger or abuse, so that the person being helped has a really intense experience of expressing their emotions.
I was reminded of this, recently, when reading Eat, Pray, Love by Elizabeth Gilbert.
The book is about spirituality and the example is about divorce. However, I think that the concept could be used in a coaching situation with a client with a sense that they did not deserve something – not an uncommon situation.
Elizabeth complains to her friend Iva about her husband’s inability to make a decision about their divorce.
“I don’t think I can endure another year in court. I wish I could get some divine intervention here. I wish I could write a petition to God, asking for this thing to end.”
Iva listened politely, then asked, “Where did you get the idea you aren’t allowed to petition the universe with prayer? You are part of this universe, Liz. You’re a constituent – you have every entitlement to participate in the actions of the universe, and to let your feelings be known. So put your opinion out there. Make your case. believe me – it will at least be taken into consideration.”
Elizabeth then wrote her petition and read it out to Iva, and she nodded her approval.
“I would sign that,” she said.
“Now who else would sign it? she asked.
“My family. My mother and father. My sister.”
“OK,” she said. “They just did. Consider their names added. I actually felt them sign it. They’re on the list now. OK – who else would sign it? Start naming names.”
They then went through a long list, including Bill and Hilary Clinton and people from history. In each case it was clear that they would sign it, and they were deemed to have done so.
Eventually, there was such a long list of supporters that Elizabeth just had to believe that it would happen. And, in fact her phone rang soon afterwards to confirm that her husband had just signed the papers.
Whether or not you believe in the power of the universe, it seems to me that this is a pretty good way of building a case that will overcome anyone’s sense of unworthiness, or strengthen a belief in a vision. I intend to use it with some of my own goals.
Much of my career over the last two decades has been based on processes that I learned through NeuroLinguistic Programming (NLP). In consultancy, facilitation and coaching I find these really powerful, and a select few are regular members of my toolkit.
But it nearly did not happen. There is a process called “Setting well formed outcomes”. This is so powerful that when I first give out the sheet of eight questions I tell people that this could be the most valuable sheet of paper they will ever touch.
The first question requires people to say what they want. It has to be stated in the positive.
You would think that was simple enough. But when I did my NLP Certificate test nearly 20 years ago I failed on this very question. The key is to recognise what you want – and not what you don’t want. Repeatedly I answered what I didn’t want, I couldn’t understand the difference and I failed the test.
Unless I passed this test I could not have gone on to the further training that has formed the basis for my business.
Fortunately, two of the trainers took me aside and after several attempts I suddenly saw the light, and they gave me my certificate.
Focusing on what you do want is key to coaching. Before you can have what you want, you must know what you want.
Unfortunately, finding out is often not as simple as it seems and knowing what you want in life can be a major challenge.
The core purpose of Brefi Group is to “help individuals and teams in organisations discover and achieve their potential so that they can be more effective with less stress”. It is our passion to help people achieve their potential, but first they must discover it.
Coaches and other professionals in the personal development field may well make it their life’s work to decide their mission and purpose. However, this is much less likely to be true for their clients.
So, learning to notice when people talk in negative terms is really important for a coach.
My whole career has been based on failing to understand this.
Thirty years ago when I was a management student in Cardiff I was convinced that I did not want to work in London. So I took the easy way out and stayed where I was by becoming a consultant.
In fact, if I had had a coach who had asked me what opportunities might there be for working in cities other than London, I might have had a successful career in the corporate world.
In fact, one of my colleagues on the course immediately obtained a director role at the Welsh Development Agency – in Cardiff. And, many years later, I had a short career in charge of director development for an international engineering group in Solihull – where I had grown up.
So, remember to insist on asking positive questions and getting positive answers.
We are taught that the unconscious mind can only handle positive instructions.
If you tell someone what not to do, the mind hears an instruction to do it.
However, not everyone understands this and it is very tempting to lay down the law by telling people all the things they cannot do.
The classic joke is “Do not deface this notice”.
On one of my many visits to Dubai I noticed this “Code of Conduct” for students at the Dubai International Academic City, and Knowledge Village.
What do you think?
Seems more like a Code of Misconduct to me.
How would you re-word it?
How many examples do you notice of just this approach to influence?
Do you focus on correcting the language of people whom you manage?
In 1969 I took part in an overland expedition to India. 500 young people in 25 coaches, we were quite a caravan.
On the way we stayed in Zagreb in Yugoslavia. Yugoslavia no longer exists. The Berlin Wall came down and much of Eastern Europe has since undergone a major transformation.
We also passed through Greece. Even on the top of wild mountains there were huge posters showing soldiers and a phoenix. Greece was under a military dictatorship – it is now free.
Then we passed through Iran. Throughout we were accompanied by very helpful guides from the secret police who ensured that we had right of way through the traffic. Iran has since escaped from the Shah.
Everyone I spoke to was overwhelmed by Afghanistan, the scenery, the men and their beautifully decorated pony and trap transport. Afghanistan has since been invaded by Russia, taken over by the Taliban and is now attempting to grow its own democracy.
In 1981 I was sent by the OECD to Spain to help them with schools transport policy. Spain had recently emerged from the Franco regime and the television was giving lessons on how to run trial by a jury. Portugal has also escaped from dictatorship.
I have worked in South Africa. South Africa has emerged from apartheid.
Change happens, and very often it happens when the time is right; suddenly a tipping point is reached, nobody foresaw it but everything seems to come from nowhere.
Now change is sweeping across the Middle East – currently it is in turmoil.
Change offers both a risk and an opportunity. It is a time when a coaching approach is really valuable.
Whether it is a matter of changing how you do something, changing your job, or something as massive as a revolution, the assistance of someone who will slow you down to really explore the reality, the options and the consequences can make the difference between success and disaster.
When the people of Eastern Europe or Arabia throw off years of control they are left with freedom but little experience. When they destroy oppressive governments they can be left with no civic structure.
This is time to ask “What do you want instead?”
Time to consider:
What do you really want?
What would be even better than that?
What would having that do for you?
How would having that affect others?
What has to happen for that to be possible?
What might stop you?
What is the first action you must take?
All good coaching questions. Use them anywhere, for a simple decision or to overthrow a regime.
Team members get things done on time and meet expectations.
High-performing teams have clear goals, and have well-defined roles within the group.
The work has personal significance to each member.
The group believes their work is purposeful and positively impacts the greater good.
The last one stood out from the rest.
We’ve all been in meetings and, due to the fear of seeming incompetent, have held back questions or ideas. I get it. It’s unnerving to feel like you’re in an environment where everything you do or say is under a microscope.
But imagine a different setting. A situation in which everyone is safe to take risks, voice their opinions, and ask judgment-free questions. A culture where managers provide air cover and create safe zones so employees can let down their guard. That’s psychological safety.
The Johari Window, named after its inventors Joseph Luft and Harry Ingham, is a way of learning about ourselves by comparing what we are aware of with what others perceive.
It is one of the most useful models describing the process of human interaction. It is also referred to as a disclosure/feedback model of self-awareness and by some people as an information processing tool. The Johari Window represents information such as feelings, experience, views, attitudes, skills, intentions, motivation, etc described from four perspectives.
The model can be used to represent either an individual or a group.
A four paned window divides personal awareness into four different types, as represented by its four quadrants: ‘Open’, ‘Hidden’, ‘Blind’, and ‘Unknown’. The lines dividing the four panes are like window shades, which can move as an interaction progresses.
It is used primarily in self-help groups and corporate settings as a heuristic exercise to help people better understand their interpersonal communication and relationships.
The subject is asked to pick five or six adjectives from a list of 55 that they feel describe their own personality. Peers of the subjects are then given the same list, and each also picks five or six adjectives that describe the subject. These adjectives are then mapped onto a grid.
Adjectives selected by both the participants and his or her peers are placed into the ‘Open’ quadrant. This quadrant represents traits of the participant (or subject group) of which both they and their peers are aware.
Adjectives selected only by the participant, but not by any of their peers, are placed into the ‘Hidden’ quadrant, representing information about the participant of which their peers are unaware.
Adjectives that are not selected by the participant but only by their peers are placed into the ‘Blind’ quadrant. These represent information of which the participant is not aware, but others are, and they can decide whether and how to inform the individual about these “blindspots”.
Adjectives which were not selected by either the participant or their peers remain in the ‘Unknown’ quadrant, representing the participant’s behaviours or motives which were not recognized by anyone participating. This may be because they do not apply, or because there is collective ignorance of the existence of such a trait.
Coaching can take place around a discussion of the differences between the adjective selected by the individual (or the subject group) and the individual’s peers (or by other groups). The window can be redrawn to reflect the relative sizes of each pane. increasing the size of the open area by reducing the size of the blind area would normally be seen as a benefit. This can be done by the quality of feedback, and the process of disclosure.
The unknown area can also be reduced. For example: by others’ observations, which increases the blind area; by self-discovery, which increases the hidden area, or by mutual enlightenment – typically by group experiences and discussion, which increase the open area as the unknown area reduces.
Here is the list of the 55 adjectives used to describe the participant:
Able, accepting, adaptable, bold, brave, calm, caring, cheerful, clever, complex, confident, dependable, dignified, energetic, extroverted, friendly, giving, happy, helpful, idealistic, independent, ingenious, intelligent, introverted, kind, knowledgeable, logical, loving, mature, modest, nervous, observant, organised, patient, powerful, proud, quiet, reflective, relaxed, religious, responsive, searching, self assertive, self-conscious, sensible, sentimental, shy, silly, spontaneous, sympathetic, tense, trustworthy, warm, wise, witty.
Known to self
Not known to self
Known to others
Not known to others