Startup Boards for CXO’s Series: Post 11 of 11
On many boards there isn’t a formal review process for board members although in an earlier post I advocate for CEOs to institute some type of feedback process. It doesn’t have to be formal or scientific, but some measure of the board’s effectiveness and individual performance is a welcome thing. My sense is that most CEOs are reluctant to do this, in part because the board is their “boss” and evaluating the board goes counter to our ideas about reviews. But part of it is also because many CEOs haven’t thought about the board as a strategic asset, haven’t managed it, and don’t have a real plan for growing and developing it.
So, as a board member, if you’re on a board that doesn’t have a review process, how do you know if you’re doing a good job as a board member? Self-evaluation is rarely accurate and, unless you’ve served on multiple boards and can somehow judge your effectiveness, is almost always biased. But there are a few key areas, a few key roles (or deliverables, if you want) that every board member takes on and I suggest that you create your own scorecard with a scale of one to five for each task and try to evaluate yourself on each one.
Engagement. Do you participate fully in the board meetings? Do you contribute ideas, do you challenge the room, do you seek to drive the conversation to get a better understanding of issues and to make better decisions? Along with engagement in the board meetings you can also measure your engagement with the materials, with the broader industry in which the company operates, and you can measure your engagement with the other board members.
Constructive Feedback. Are you giving feedback that’s constructive or are you mostly repeating what others have said, or providing summary comments of what’s been discussed? Are you willing to “speak the truth” when you see it or do you hold back and wait for others to speak up? Constructive feedback is not always about providing a novel or insightful idea; sometimes it is raising the difficult topics, it’s bringing up the elephant in the room.
Connectivity and Perspectives. This one is similar to “engagement” above, but are you working to connect with others? Are you inclusive? Do you work to understand other perspectives that you don’t agree with? Do you try to bring in outside perspectives, raise topics based on similar experiences you’ve had? Are you making introductions to the CEO as one of the company’s main ambassadors?
Governance. Do you act as a fiduciary, as an advocate for shareholders, or for your own interests? Have you read the state laws that pertain to your company, along with all charter documents including articles of incorporation, bylaws, and shareholder rights? Are you being rigorous in your oversight of management and financial performance?
These four broad areas are the main ones that Board members are responsible for, and the self-assessment, though not ideal, will help you understand your own strengths and weaknesses. Once you’ve created it you could share it with the CEO or other board members and have them fill it out for you. Who knows? Maybe a little scorecard will be all you need to start a board performance process.
Beyond a formal performance process, though, I can tell you from my experience that the most impact board members have on a CEO or on a company can come in many shapes and sizes. Just for fun, I’ll write down here the top impact that each of a number of long-time board members I’ve worked with has had on me and my companies over the years:
- Director A pushed me to hire a coach. I never would have thought that was useful. It led to one of the most meaningful professional relationships of my career and a two-decade long run with someone I refer to as my “secret weapon” for scaling.
- Director B became a true personal friend as well as a board member. We had a large number of meals, workouts, and travel together over the years. He really got to know me and care about me as a human and has pushed me as much on personal things as on work things.
- Director C kicked my ass once when I really needed it and helped me drive a major course correction. After a couple of really challenging quarters in a row, after a board meeting in which I presented a series of excuses and rosy pictures of the future, he held up a metaphorical mirror and made me realize that the problem lay with me, not with exogenous factors – but also that the solution lay within me as well.
- Director D always asked me for advice on his business as much as he gave me advice on mine. We had – and continue to have many years later – a mutual advisory relationship. The fact that I know so much more about his business than I otherwise would gives his advice to me an important layer of context that makes the advice richer and more impactful.
- Director E had amazingly colorful metaphors and examples and expressions that resonated with me and our management team AND became part of the language we used to run the business and make decisions day-in, day-out.
Having said all of that, the simplest way to know if you’re doing a good job as a board member, if there is no formal board review process, is to ask. There’s no reason you, especially as an independent director or even more so a first-time director, can’t ask the CEO and all of the other board members if they think you’re doing a good job – even in a structured way (what are you doing well, what could you be doing better, are you getting what you expected to get out of me, etc.).
Since part of the reason for being on a board is to gain experience, it’s critical that you get feedback along the way to ensure that you are building skills that help you be a more effective board member.
-Matt Blumberg, July 22, 2021
