The Importance of Board Management Effectiveness

Board management effectiveness becomes increasingly important as the pace of business speeds up. Boards must be able sift through the “known knowns” and concentrate on strategic imperatives that create long-term value and guide companies towards their objectives.

To achieve this they must have access to data that allows them to detect and respond to any new risks quickly and efficiently. They must also be able to develop a culture that encourages constructive dissension and engage in honest discussions that challenge the views of the majority. To achieve this, they should be able to cultivate their professional skepticism in a practical manner and have the courage to voice their concerns both within the boardroom and with their company’s top executives.

Boards must also make sure they have effective procedures in place for identifying new talent, hiring the candidates and successfully getting them to join the group. The board is an evolving organism and as directors leave they should be replaced with those who possess the appropriate mix of experience, skills and competencies in order to meet the needs of the changing times of the business.

It is essential to have a process that ensures the decisions made by the boardroom reflect in the decisions taken by committees. This is where boards often helpful resources fail due to confusion and a lack of consistency. A good evaluation process can expose these problems, and provide constructive feedback for directors individually without focusing on anyone in particular. This will help the board to address weaknesses in leadership and ensure it is able to reach its strategic goals.