The board of directors of an organization serves many functions, but its main duty can be narrowed down to choosing the right CEO to run the show (or in this case, the day-to-day operations). The job sounds simple enough, but it’s not easy. The choice of a CEO can make or break an organization, and that responsibility falls squarely on the directors’ shoulders.
But boards don’t always make the right selections, so the organization suffers in turn. Just look at Yahoo and Hewlett-Packard if you want a few examples. Before current CEO Marissa Mayer took the top post in 2012, Yahoo had already gone through several CEOs, each one failing to bring back the company to its glory days. Hewlett-Packard wasn’t much different. In two and a half years, the company was on its third CEO and already developed a reputation for boardroom drama before settling down with current CEO Meg Whitman.
It’s better to choose an effective CEO to begin with than to replace a non-performing one. Thus, boards should have a stringent selection criteria when considering potential candidates.
The perfect fit differs from one organization to the next, but as a general rule, effective CEOS are:
They have a clear vision of the organization’s direction. They know where the company is headed, and how to bring the company towards that goal. In case that particular vision doesn’t push through somewhere down the line, they have contingency plans that will steer the organization to a different but equally profitable and sustainable direction.
They can express their ideas and opinions in an articulate and understandable manner regardless of whom they are taking to. They also keep their doors open, encouraging people to approach and open up to them. Most importantly, they encourage open communication among all branches of the organization as a way to build transparency and trust.
They know how to handle people, whether staff, peers, or superiors. They exude enough authority to garner respect from stakeholders. They also have the desire and ability turn their subordinates into the organization’s future leaders.
They can work with a team, even when they are used to holding a leadership position. They understand synergy, or that the whole is greater than the sum of its parts. They get along well with their board of directors, investors, staff, customers, etc. in a professional and on some levels, personal capacity.
They are not afraid to take risks especially those that can bring great rewards for the organization. Of course, this doesn’t mean that they take risks indiscriminately. They study and assess risks to see if the chances of success are reasonable. But at the same time, they are not too cautious or complacent as to stop their organization from trying new things.
They may be unafraid to take risks, but they are realistic about what they can do, and about where the organization is heading. It’s this realism that makes them know when to quit, cut losses, and start over in another direction. Their decisions are practical and reasonable.
They stand up for what they believe is right, even when faced with strong opposition from the board of directors. They have the conviction to back their decisions and the grace to accept defeat if they’re outnumbered. But at the same time, they are open to different ideas in the hopes of finding good ones. Winning isn’t their goal; protecting the organization’s best interests is.
They have expertise on the organization and the industry it belongs to. Their knowledge is valuable especially when it comes to decision-making. They are involved in their organization to know enough about how it operates. When something goes wrong, they can tell where it happened, why it happened, and how it can be resolved.
Finding candidates with all these personality traits is not going to be easy, but directors who are willing to work together in scouting for the best talents can eventually find the perfect match for their organization. Luckily, Convene, our remote board meeting solution, makes the task more convenient. With just their iPad, iPhone, or Android device, directors can go online, review the credentials of potential candidates, and make notes on the documents for other directors to see. When board meeting time comes around, they can work together in real-time using Convene’s screen synchronization feature. The process has never been this easy before!