Does Your Board Micromanage?

Does Your Board Micromanage?

Does your Board micromanage? Do you feel that they are making decisions that are the purview of management? Do you believe they are requesting information that they really don’t need or shouldn’t have? Are they interfering in operational matters? It happens.

Let’s look at this issue from the Directors’ point of view. Directors have legal liability for the performance of the organization. It is their necks that are on the block. Therefore, they MUST feel assured that the organization is being well run, that management knows what it is doing. The underlying issue is trust. The basis for this is the information they receive.
Even when management is submitting information “for advice only”, it must be considered the basis for decision-making. For if there is a problem with the results presented, the Board must take action and make a decision.

Having sat on a number of Boards throughout my career, whenever management presents information to me, I always wonder:

• Is this information the right information I need to make the decisions I, as a Board member, need to make? i.e. is it relevant to the decision?
• Is this information accurate?
• Is this information adequate?
• What am I not being told?
• What else do I need to know to make the decision?
• Is the information hiding rather than revealing? I sometimes wonder this when I get too much information.

I must be honest, of all the Boards on which I have served in over 30 years, there is only ONE where I have felt assured that management really is on top of things. And it’s a pleasure to serve on that Board. I am assured that the management is competent – not by their qualifications, but by their performance. They are clear and forthright when there are problems and proactive in identifying and implementing solutions, and open and responsive to our feedback. I trust them because I am getting the information I need, on time and will full explanation.

If you feel that your Board is micromanaging, don’t just grumble about it. Ask them:

1. What information do you need to make the decisions that you as the Board are required to make?
2. How often do you need it?
3. In what format and how much detail?

And make sure to provide them with what they need. You will find that over time they trust you, and you trust them.

THE BALANCED SCORECARD

The Board Scorecard can be a very useful tool for the directors to get clear and communicate their information requirements. Once the Corporate Scorecard is developed, you can cascade “up” to the Board just as you cascade to your business and support units.

My recommendation is that the Board develops this in a facilitated environment – just as you do with your Corporate Scorecard. They will have a Strategy Map and Scorecard, as well as their own Initiatives to improve their performance as a Board. And of course, they will report on this at least quarterly in private sessions where they can speak openly with each other.

Read more on how a Board Scorecard can improve governance: click here to view article

TAKE ONE ACTION

Examine one report that you currently present to your Board. Is the purpose of this report clear to you? Does the report meet the objectives? Is the information presented in a way that is clear, easy to read and interesting? What improvements can you make to the report?

Discuss this with your Board Chairman and agree on the changes. Then, just do the report and ask for the Board’s feedback.