Business IntelligenceHR Technology

Boards Overlook the Role of Talent in Success

By March 8, 2019 No Comments

When it comes to operational reporting, most board directors look to the CEO for a download on whether the company has the right people in place to execute on the company’s strategic initiatives. That’s if they ask at all. Because most directors have almost no experience in talent management: they are investors, CFOs, operations experts, technologists. And yet, in a tight labor market and in an environment of disruptive technologies, I would argue that having human resource expertise reporting to the board and sitting on the board has never been more important. Or more overlooked.

 

While I’m not convinced that culture eats strategy for breakfast, I am convinced that “All strategy is executed by people, people who need to be supported, trained and equipped to fulfill that strategic vision.” (props to Brian Hults, formerly of Rubbermaid). In addition, the technology landscape is experiencing such seismic shifts in platform development that it’s no longer a question of understanding the new software offerings: it’s a question of understanding the implications of autonomous cars on workforce capacity and productivity, of cyber threat on training up and down the org chart, of data mining on company business processes and trade secrets, and of robotics on workforce training. Who better to analyze and report on this than your chief people officers and workforce management executives?

 

I spoke recently to a group of human resource executives. Many were employed at venture backed companies. On a hunch, I picked five whose names are well known from the attendee list and researched their boards of directors, and – Why hellooo, Captain Obvious! – all the boards comprised a couple of executive directors and a boatload of investors listing to the finance side. This is a missed opportunity to provide good, 360-degree, duty of care governance to growing companies. Investors would better protect their investments to provide their portfolio companies with expertise that aligns with the strategic plan.

 

Since you, Gentle Reader, are more likely to hail from the Human Resources Camp that the investor Camp, let’s you and I talk. Your job is to insinuate yourself into the board room conversation in order to educate that boardroom talent pool on your company talent pool. As I said, most boards look to the CEO for answers about related to human resources if those questions even get raised. But you know and I know that your company’s talent story is the keystone of your company’s success, #amirite?

 

While boards have weighty mandates to oversee executive integrity, manage risk and ensure execution of the strategic plan, the dispiriting fact is that many boards barely achieve minimum requirements of the mandate: hire / fire the CEO, design a succession plan for key executives and approve compensation packages. Please note how many of these tasks are people management type tasks. And yet, on annual performance assessments, boards routinely rate themselves lowest on succession planning and fire the CEO only in situations characterized by the direst ethical or financial failures.

 

Thus, it is very plausible that your board has no real plan for any of these tasks. It is also plausible that your CEO may not actually know how to manage the Board and get them to fulfill these basic duties especially if he / she inherited them and was not involved in sourcing these personalities.

 

Start with the idea that your company’s board is a talent pool that should be managed like any other talent pool. Research who’s on the board and why; look over their bios, assess their competencies. If you’ve got a boatload of investors, find out where you fit in their portfolio to get clues on their interest, or lack thereof, in your company. And use this information to open a conversation with your CEO on where you can support him or her to improve the company’s governance. Work together to improve the relationships and get the Board focused on succession planning and adding competencies to the group that align with your strategic objectives. You may get push back at the start but point out that bad governance takes down good companies.