I am asking for your input today. I hope you will read and respond.
As a business leader, you know that a healthy board is crucial for your company’s success, especially when it comes to succession planning. But what exactly makes a board “healthy”? Recently, at an overseas impact investment conference, I had the opportunity to speak with an expert investor who specializes in family businesses and companies in transition. His insights on board health were both simple and profound.
The Two Pillars of Board Health
According to this seasoned investor, there are two key elements to maintaining a healthy board:
1. Recognize the elephants in the room
2. Deal with issues in the boardroom, not the parking lot
Recognizing the Elephants
Every company has its “elephants” – those big, uncomfortable issues that everyone knows about but no one wants to address. As a CEO, it’s your responsibility to bring these elephants into the light. Some common elephants include:
Conflicts among partners
Underperforming team members
Unresolved family tensions in family-owned businesses
Disagreements about company direction or strategy
Recognizing these issues is the first step toward resolving them. It requires radical transparency and a willingness to face uncomfortable truths. But remember a board that can’t acknowledge its elephants is a board that can’t effectively plan for the future.
Dealing with Issues in the Boardroom
Once you’ve identified the elephants, it’s crucial to address them head-on in the boardroom. Too often, important discussions happen in hallways or parking lots after meetings, leading to fragmented communication and unresolved issues.
As the leader, you must be the master of initiating and maintaining healthy discourse within the boardroom. This means:
- Creating an environment where all board members feel safe to speak up
- Encouraging open, honest dialogue about difficult topics
- Ensuring that decisions and discussions are documented and followed up on
The Link to Succession Planning
Step 2 of the 7-Step Process: Establish Your Succession Planning Team
How does this relate to succession planning? Your succession planning team is an extension of your board, and the health of both are intrinsically linked. A board that can’t address its elephants or have difficult conversations in the open is ill-equipped to handle the complexities of succession planning.
When establishing your succession planning team, consider:
1. Who does the CEO trust to share about these elephants in the room? This person (or people) should be part of your succession planning team.
2. How well does your current board handle uncomfortable conversations? If there’s room for improvement, address this before diving into succession planning.
3. Are there any elephants specifically related to succession (e.g., family members expecting to take over, disagreements about the company’s future direction) that need to be addressed?
Steps to Improve Board Health
1. Conduct a board health assessment: Anonymously survey board members about their perceptions of board effectiveness and any “elephants” they see.
2. Implement a “no parking lot” rule: Encourage board members to bring up issues during meetings, not after.
3. Practice radical transparency: As the CEO, lead by example in acknowledging and addressing difficult topics.
4. Bring in outside expertise: Consider hiring a board consultant or coach to help improve communication and decision-making processes.
5. Regular check-ins: Implement a system for regularly assessing and improving board health.
A healthy board is the foundation for effective succession planning. By recognizing your elephants and addressing them head-on in the boardroom, you’re not just improving your board’s health – you’re setting your company up for a successful future transition.
As I say in my book, Succession Planning for Impact: “Begin these conversations now to minimize relational conflict later.”
Your future self – and your future successor – will thank you for it.
MY ASK OF YOU TODAY
I would love for you to help me in my succession planning research. Will you hit reply to this email and tell me the elephants that you have experienced in your boardrooms? Please, you have no idea how valuable this is to me. I will use it to help others.
Elephants are incredible in Africa, not in the boardroom!
Harry T. Jones
P.S. Don’t go it alone and waste years spinning your wheels on succession planning. Bring in an advisory team from the start by joining our Succession Planning for Impact Mastermind.
You’ll get guidance through the proven 7-step method to build your leadership team, define your legacy impact, and execute a smooth transition - all while you spend less time on daily operations.
Hit reply with “Mastermind” in the subject line to get on the waitlist for our next mastermind. An outside perspective from day one could save you decades of frustration.
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