Given the weight of responsibility that rests on their shoulders, CEOs have long been depicted—at least when observed from a distance—in near-heroic terms. Before the pandemic, people generally assumed successful business leaders were rigid, impenetrable figures, who succeed by simply staring down external adversity. But CEOs are not superheroes. Even before pretty much every business on the planet was caught off-guard by the COVID-19 outbreak, it was clear that being un-disruptable in today’s challenging marketplace demands the ability to navigate constant turbulence and continuously adjust.
In the Deloitte research paper “Can CEOs Be Un-Disruptable?” we articulated new models for leadership flexibility recommended by CEOs and board members we interviewed. This paper highlights an underutilized resource that CEOs can turn to for help. The resource in question is the corporate board. This may sound obvious. After all, directors come from an array of businesses with a variety of skills and experiences; they are there, in part, to help the CEO succeed. But as we learned while researching ways to make boards more strategic, not only do CEOs want to lean more heavily on their boards and involve them in a strategic role, but directors also seek more effective ways to provide the kind of input that will better guide the company’s strategy.
The board chairs and directors we interviewed told us that they want to contribute more value and expect to be more involved in high-level strategy and discussions. In short, the board comprises a unique repository of industry knowledge, strategic leadership experience, and other knowledge that CEOs can tap into. And in today’s business environment, a broader spectrum of talents and skills than ever before can be put to positive use.
In “Seven Steps to a More Strategic Board,” we discuss a number of ways CEOs can maximize the value of their companies’ boards. One key finding is that when boards evolve to become a more strategic asset, CEOs enhance communications with board members and are more focused and effective in their interactions with them.
We’ve often seen that CEOs, when conversing candidly about their role, sometimes try to validate their own models of the business environment; they’re interested in getting the board behind their vision of the future. But increasingly, CEOs are realizing that if they are to take the lead in making the board a strategic asset—a “smart board” that goes beyond being a sounding board—it is incumbent upon CEOs to take the initiative and cultivate these relationships.
“CEOs can help boards develop into more closely woven, interconnected groups by influencing what board members experience outside the boardroom—both as a group and individually.”
How can they do this? One way is to reconceptualize the actual role and time commitment of directors. The long-established belief is that participation on a board consists of four to five board meetings per year. Our interviews with CEOs, board members, board chairs, board advisors, and academics who study board governance point to the potential of the board’s experience outside these formal sessions. The time between board meetings is perhaps just as important as the meetings themselves. One of the directors we interviewed remarked that “a lot of the thinking and views that get shaped are ultimately the result of conversations in between meetings.”
In other words, CEOs can help boards develop into more closely woven, interconnected groups by influencing what board members experience outside the boardroom—both as a group and individually.
Within their organization, CEOs can also help foster transparency in the expectations they set for interactions between the board and the rest of the management team. They can encourage board members to “walk the halls” and ask questions; they can facilitate board member visits to company sites; and they can arrange meetings or informal gatherings with key executives and management. CEOs should also consider more meaningful ways to include the management team in some aspects of board meetings. Directors may develop a deeper understanding of a particular issue by observing internal meetings and town halls. Some CEOs actually pivot the direction of feedback, asking their executive teams how the board can better support the C-suite.
One consistent theme appeared throughout our research: board members do not like to be surprised. One poorly placed or unexpected comment can take a board discussion off course, or worse, put a wrench into the spokes of the wheel, grinding the conversation to a halt. One antidote to this phenomenon, directors told us, is for CEOs to interact often with board members between meetings.
This doesn’t necessarily mean communicating with the board or a board committee as a whole each and every time. One-on-one conversations, without the formality, pressure, intensity, and performance assessment of a board meeting, can help directors feel like trusted colleagues rather than judges ready to mete out punishments.
It is important, however, to be thoughtful when communicating informally with selected members of the board to prevent the risk of creating two (real or perceived) classes of board members: the ones in the know and the ones who are not. If an effective and well-balanced approach to communication with board members is successfully deployed, then, beyond merely building an interpersonal bond, sharing information with board members throughout the year reduces the risk of surprises—which, as mentioned above, can enhance an entire group’s experience. Whether or not the CEO was responsible for the surprise, the CEO will be held accountable.
To lower the risk of surprises, we have heard that it is usually better to err on the side of more communication with the board, rather than less. To keep everyone equally in the loop, some CEOs will e-mail periodic updates that cover high and low points of the month, or send weekly memos to the board that incorporate news about developments in the industry or current articles of interest. Determining board members’ preferred mode of communicating is also important: some directors may prefer the relative privacy of the board portal to e-mail. And many people still respond best to a direct phone call.
What we have deduced from our research is that it is not a good idea to leave any board member out of the information-sharing process. Modern CEOs may not always have the time or even the need to receive input from the entire board of directors. Nonetheless, however tempting and natural it may be for CEOs to speak regularly with the two or three directors with whom they feel the most affinity, it is imperative to remain mindful of keeping everyone on the same page. Informing individuals outside of meetings or asking for their input is not the same as informing the board. All directors should be informed at the same level.
Reaching outside the organization to bring boards together can also be a powerful tool in creating both tactical synergy and fresh new perspectives. Directors we interviewed for our study spoke enthusiastically about education as a key part of their board experience, whether that education is in the form of conferences, speakers, or creative learning opportunities that CEOs and their management teams developed for the directors. Some CEOs have gone so far as to arrange off-site “field trips” and tours of external organizations for their boards. These initiatives can lead to positive outcomes, and sometimes powerful insights.
Boards are first and foremost comprised of skilled, creative, smart people. The more deeply the CEO can understand each board member’s personality and experience, the better and more fruitful the overall interaction with the board will be. From this starting point, the CEO can influence the design of experiences and interactions that encourage each director to fully engage and productively contribute throughout their tenure with the organization, and with the governing group. By influencing what happens between board meetings, whether through regular, direct communication with board members or by encouraging other interactions inside or outside the company, CEOs have the opportunity to curate and even co-create a better board experience. If positive and interconnected, this experience can lead to better decision-making and more strategic outcomes.