Back to the Drawing Board
By: Colin B Carter & Jay W Lorsch
Publisher: Harvard Business School Press
Price: $65
This book is about “designing corporate boards for complex world”, according to the sub title. And why? Because, the authors’ argue, corporate boards are in need of “major redesign”.
Carter – who by the way is New Zealand born and, after many years working for the Boston Consulting Group and teaching at IMD in Switzerland, Yale in the US and the University of Melbourne, now lives in Australia – and Harvard Business School professor of human relations Jay Lorsch, don’t think tinkering round the edges will fix the deep-seated problems facing today’s boards of directors. It is, they reason with some persuasion, time to go back to the drawing board.
As directors and consultants to boards, the authors have “sat in dozens of boardrooms” and discussed the issues with “hundreds, if not thousands, of directors and senior executives”. The conclusion they have come to is that boards are struggling to cope with the complexities and challenges of today’s competitive and rapidly changing world because existing board structures are past their use-by date.
It is difficult to argue with their observation that most boards struggle to perform to anything like best practice standards, despite the increased scrutiny and regulatory reforms imposed from outside and the reform initiatives taken by some more enterprising boards.
Boards aren’t, by and large, exploring changes that will “make them more effective”. Most of them resort to mixture of old and new practices, some of which conflict, and which together don’t provide the best design to deliver on increasingly onerous responsibilities.
Pooling their personal experiences and wisdom the authors have come up with nine-chapter approach to explaining the reasons and steps for creating new board designs. They explain how and why boards are struggling, notwithstanding the new best practices, and they examine the contradictions that are inherent in these practices.
They outline several ways in which boards can rethink design, starting with some suggestions about how directors should conceive their role. There is, say the authors, considerable leeway available to boards when it comes to deciding what activities they wish to undertake. “Each board has to decide what it can and must accomplish, and different boards will legitimately reach very different conclusions.”
Board structures, director selection, designing processes and practices and lesson on how to focus on director behaviours that lead to effective boards are revealed and argued in compelling case for change, re-think and restructure. To summarise they talk to independent directors, chairmen, CEOs, lead directors and committee chairmen about the future and effective boards. They also publish the results of targeted but telling survey of CEOs.
I agree with the authors’ general conclusion that the principles of board design on which the book focuses are appropriate to all companies in all countries. And that is important because, as they point out, “as global capital flows have grown and as investor crises have unfolded in number of countries, pressures for improving corporate governance have become global”.
Back to the Drawing Board deals with complex issues in refreshingly simple and easy to read and comprehend style. It is perhaps the best book of its kind to emerge since the corporate disasters of the past three or four years highlighted the pending demise of the old board design.
50 Success Classics
By: Tom Butler-Bowdon
Publisher: Nichols Brealey
Price: $35
Snippets, snatches and clever chapters from an impressive array of motivational writings and writers including Stephen Covey, Michael Dell, Jack Welch, Nelson Mandela, uncle Sam Walton and all.
This is easy-to-reference and quick-to-resort-to stuff when you need an injection of inspiration – for whatever occasion. The dust jacket calls this book “practical yet philosophical, sensible yet stimulating” and who am I to argue?
It draws on extracts from 50 classics spanning “biography and business, psychology and ancient philosophy, exploring the rich and fertile ground of books that have helped millions of people achieve success in their work and personal lives”.
Great if you are looking for ideas to explore with the sales or management team to lift them out of performance slump.
