Posted By: Admin, 01 Jun, 2011 - 03:33 pm
The Buck Stops here! There is an old saying that you are only as good as the people around you.
It’s a maxim to which I readily subscribe, yet – as a business leader – I need to ensure I have taken every precaution to protect the good name of the organisation I serve.
I was at a governors’ meeting recently at a local school in Birmingham and we were discussing the forthcoming school inspection. One of the governors is an ex-head-teacher and was telling us how one person having a bad day could mess up a whole inspection. Also any failure would not be attributed to this lone ranger but to the person with whom the buck ultimately stopped – the boss, or in this case the head-teacher.
Although you may work as diligently as you can with all your staff, when one person gets it wrong it is the man or woman at the top who must shoulder the responsibility, if not always the blame.
You may, as I do, operate on a “need to know” basis. But, although you do not need to know every detail of what is happening in your business, your performance can sometimes be measured by relatively small, insignificant acts.
So, if the buck stops at the top and I want to measure the success of an organisation, then I should gauge the success and effectiveness of the board.
Surprisingly, however, it is not common practice to measure the board’s performance. I can think of many complacent boards who have not evaluated their performance, although I won’t name names here.
Boards should be asking themselves which key items need discussing, how well papers are presented ahead of meetings, whether the chair is enlisting the best contributions from all the directors in allowing full discussions without getting involved in the minutae.
The board should evaluate whether all the board members – executive as well as non-executive – are contributing the skills that they have to offer. Targets for performance need to be set individually, as do some form of development plan to enhance people’s skills.
A board appraisal process could start with identifying what you want to achieve from such an initiative. The objective may be to ensure that there is ultimate control over the key issues the organisation is facing – compliance with the ever-increasing regulatory burdens, for instance. Policies and procedures should be up to date and relevant, for example recent changes like the UK Corporate Governance Code 2010 should be monitored.
Let’s consider the Corporate Manslaughter and Corporate Homicide Act 2007. A formal boardroom review of health and safety performance is essential when you consider the potential risk. It allows the board to establish whether the essential principles have been embedded in the organisation to manage risk and protect your people.
If you are in the charitable sector, then you need to consider the Charities Act 2006 and the relatively new Charities SORP.
Having determined what is expected from the appraisal process, the type of appraisal and timescale should then be considered. Individual board members may need to be interviewed by the chair to give feedback on how they feel the board is operating, and have some evaluation of their own performance. Or will the appraisal be an away day with the help of external facilitation, or for that matter a combination of the two?
Whichever route you choose you can be sure it’s not just you – but the people around you – who will help drive the business forward.