decide what you need, then look for the right people.
by steven e. sacks
in discussing how to select your firm’s board, the issue was that you want to have the proper board composition with the people, right values, philosophies and a shared commitment to the success of the firm.
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as a firm leader, a matter you think needs immediate attention could simply be a symptom of a larger problem. it’s common sense that you would not visit your doctor to treat your broken leg with a band-aid, so why look for a fast, ineffective and incorrect solution as a way to fix an operational or cultural problem? this is why those who are on the board are selected for their acumen and belief in the why the firm or company exists and how it can be improved.
“to succeed in business, to reach the top, an individual must know all it is possible to know about that business.” – paul getty
if you want to ensure the firm’s long-term success, here are a few suggestions:
- create a board operating manual that describes the duties, actions and responsibilities, and includes a formal section for a signature that confirms compliance. you can ask outside counsel for advice on such wording along with actions that can justifiably terminate the individual’s place on the board for cause. some firms require regular attendance at board meetings, participation on at least one committee, and of course, completing an assignment required for a subsequent board meeting. otherwise, lack of attendance, progress and contribution renders the board useless.
- the board, while it may meet monthly or quarterly, should be thinking strategically year-round. this is especially true when there will be rotations giving rise to nominations. beyond member selection, the board should be responsible for orienting, supporting, training, mentoring and evaluating its members.
- assess the current board by looking at its size, diversity and creativity. consider what is necessary, such as specialized knowledge, skills, prior experience on boards (outside of the firm), business development skills and other important attributes. these attributes could change as the firm evolves over time, but likely they wouldn’t change year to year. consider making this assessment every three or five years.
- in addition to an evaluation of the board composition, take a hard and deliberate look at what the board has too much of and too little of. this ties into the prior bullet point because you may be overlooking important elements that will help your firm become more competitive, as well as the potential to create initiatives that result in a better work environment.
- can we safely assume that all cpa firms have a strategic plan? let’s not. if such a plan does not exist, it is important to create and connect a plan with the right board composition. the new board, using a fresh set of eyes and a new voice, will oversee and give final approval on the vision, mission, values and goals, as well as the short-, mid- and long-term strategies. at the same time, skills and expertise are identified and tracked – looking at the firm’s future stars is a start. once the criteria are developed and consensus reached, the current and future board members will have the necessary information to facilitate the board operations in concert with the strategic plan.
remember, you are building a foundation for the firm and not looking to stock the board with “favorites” who may result in a future crisis of confidence.