Most entrepreneurs view board meetings as somewhere between a total waste of time and mildly annoying. Outside board members are often similarly frustrated that they are unable to get the information and analysis they desire from these meetings. This shouldn’t be the case. Board meetings should be valuable for both management and outside board members. How can you make that happen?
Last year, I spent more than 600 hours in board meetings and have developed theories on how to make them more productive. For simplicity, I’ve created a series of “do’s” and “don’ts” for both management and board members.
Tell a story with the board deck. A well-designed board deck should communicate how the company is doing and the core issues facing the company. The most common mistake I see are decks that are simply data dumps, a bunch of information without any analysis or coherence. For most companies the deck should be 12 to 15 slides. For complete financial statements or other more granular information, that can be put in an appendix that is distributed to the board members and discussed if requested.
- Send out the deck well in advance of the board meeting. You want your board members to read it beforehand, but it’s not reasonable to expect that if you provide it the evening before a meeting.
- Note variations from your plan and reasons why. It’s not uncommon to miss goals. The most important issue to explore is why you missed. With lower than expected sales, there are a numerous causes: Is your sales team not that good? Are you not investing enough in marketing? Is your product not solving a painful enough problem for customers? Is your product poorly designed or engineered?
- Keep the meeting on schedule. This can be difficult and you can’t be too rigid, but most board members have calendared an end time to your meeting. If a section runs over, you will have less time to cover other sections. Don’t be afraid say, “This is a good discussion, but we need to keep the meeting on time. We can follow up on this later.” This can be particularly useful if the discussion has devolved.
- Keep a list of follow-up items for yourself (and the board members). Distribute the list afterwards so everyone is clear on next steps, then report on the status of those items at the next meeting.
- Hide bad news. A board meeting is not a pep rally. If news is bad it will likely get worse. Far better to start discussing “issues” before they become problems or, worse, crises.
- Put information on slides you don’t want to discuss. If you put it on a slide, you should expect that board members might have questions about it.
- Have every VP present at every meeting. You want to give your team members airtime with the board, but it is better to rotate them because there is typically not enough board level information to justify a report from each VP.
- Put the key points about the meeting in the first slide. It starts a conversation on the most important issues without any context. Once that conversation starts, it’s difficult to stop it and creates a disjointed conversation that makes the remaining material seem irrelevant.
- Argue every point. There’s nothing wrong with healthy debate. It is a sign of a high functioning board. Ultimately, though, the CEO is charged with running the company. S/he will have to decide what course to chart. Better to listen to the feedback than fight over every point.
Outside board member dos
- Read the deck beforehand. It will permit you formulate questions beforehand to help sharpen the conversation.
- Challenge assumptions. The best board meeting questions introduce a new point of view. If sales are slower than projected has management considered whether they are investing adequately in marketing? A different perspective can be extremely valuable to entrepreneurs who are busy fighting in the trenches every day.
- Share industry benchmarks or best practices from other companies. It his very helpful to compare a problem the company is facing to a problem that has been encountered before. Surfacing past successes and failures is particularly useful.
- Keep your powder dry. Undoubtedly you have a lot of good suggestions to help the company, but management will not execute on all of them. The best board members pick two or three important points and focus their comments on those items.
Outside board member don’ts
- Rely on your own experience with the company’s product as a focus group of one. Suggestions about the product based on your own use case are likely not helpful. There are more statistically significant ways of acquiring user feedback.
- Repeat yourself. I often hear board members say, “I hate to repeat myself.” There’s no need for self-loathing. If you’ve made your point, everyone around the table has probably heard it. Perhaps a single reiteration is in order if you feel quite strongly, but beyond that, you are being a bore.
- Ask obvious questions. It just wastes time and tries people’s patience. For example, if the CEO says, “We’re trying to recruit this candidate but he really wants a high salary” a board member shouldn’t chime in with “Did you try and sell him on the value of our options?” Assume that management has considered the most apparent tactics.
- Ask questions because you’re curious. There are busy people in the room who may not share your thirst for this particular bit of knowledge. If there’s something you would like to learn more about, write your question down and ask the CEO later.
Remember: Never lose sight that everyone attending a board meeting has the same objective – to help make the company successful.
In the next post, I will lay out a structure that can help make the meetings as effective as possible.