In our last blog ‘The Importance of Failure’, we discussed the concept that ideas and change should be fostered at all levels, with companies which provide opportunities for suggestion reaping remarkable dividends. This week we are getting the lift up to the organisation’s top floor and taking a look at ‘The Board’.
In Bob Garratt’s The Fish Rots from the Head: Developing Effective Board Directors, the Board of Directors is described as an ‘ecological system’. Here, the classic metaphor of an organisation existing as a living organism is scaled down to focus on the group of people who exist to oversee and maintain balance, and meet once a month to facilitate this.
The Board has a difficult job: it must possess crucial knowledge of the wider political environment within which the organisation exists, and use this knowledge to allow the organisation to adapt to changing environments. To extend the ecosystem metaphor, the Board is reliant upon its wider environment to survive, a habitat which is constantly shifting with dangers and difficulties.
So what specific pressures and responsibilities does the Board oversee? Garratt argues that the Board is required to achieve a balance between four forces relating to the internal and external workings of an organisation:
Force 1: The perception the customer has of the organisation
Force 2: The internal efficiency of the organisation
Force 3: The ability of the Board to react to external environments
Force 4: The ability of the Board to achieve goals of accountability to its stakeholders
It is clear, therefore, that any Board is under incredible pressure to fulfill several internal and external responsibilities. To complicate things further, as Garratt acknowledges, each of these four forces are potentially contradictory; they are each able to produce end products which work against the other.
So what does this mean for your organisation? How are these forces going to be balanced?
To answer this question let’s go back to basics and review why Directors are chosen in the first place. Extremely experienced, influential people in their own right, Directors are there because they are able to ask fundamental organisational questions with intelligence, and they see through and past the sometimes clouded vision of functional specialists.
The only way that Directors can achieve this, however, is if they operate as that self-sustaining ecosystem mentioned at the beginning of the article. Directors should embrace the fact that there are new ways of working and thinking, which are the things worth exploring, even if they go against historic and preferred modes of operation. Directors must not be reluctant to raise topics such as the uncertainty of external environments for fear of appearing ignorant — these topics are the nutrients of the ecosystem, and Board meetings are a fertile place for discussion and growth.
Garratt notes that there should be a ‘conscious board induction and development process’ which dissuades new members to self-censor, and diminish their suggestions and ideas. It is a human tendency to not give your own ideas sufficient promotion and room for inclusion, and it is the responsibility of a confident Chairman to encourage this information to be debated at length.
In doing so, the ‘four forces’ will be balanced and the organisation’s political dynamics negotiated effectively.