The one essential with the biggest "aha" reaction is the "Essentials Experts on the Board of Directors." The reaction is always, "Of course. Why didn't I think of that?" Hindsight is wonderful isn't it!
Companies whose boards are composed predominantly of investors and management members struggle in the long term. Exponential growth companies, on the other hand, tend to complement their boards with what I call Essentials experts: A CEO who had grown a billion dollar company; a customer; an alliance partner; or a community member.
Then, "When should we recruit these members on the board?" And "Where do we find the best board members?"
At times, the board struggles with the growth strategy of the company. Two situations seem to be the most frequent:
- The board is redefining the company's growth strategy to grow to the next level. Often there is a new CEO or President along with a few new functional leaders, or,
- The company is achieving exponential growth rates that only one dreams of. The investors are getting nervous. They want to slow the company's growth.
In either case, there are divisions within the board and often between the board and members of the management team. The source of these divisions? The members tend to view growth through the lens of their personal experiences--based on what they have experienced and can intuitively manage—rather than according to the success patterns of America's highest growth companies.
To close this gap, we utilize the 7 Essentials Scorecard. Both the board and management team should participate. Invariably, each will view the business with some subtle but important differences. Two situations seem to be the most frequent:
- The board is redefining the company's growth strategy to grow to the next level. Often there is a new CEO or President along with a few new functional leaders, or,
- The company is achieving exponential growth rates that only one dreams of. The investors are getting nervous. They want to slow the company's growth. Meanwhile, the later stage investors want to continue to "lead forward" with investments in resources and assets in order to continue on the company's exponential growth path.
In either case, there are divisions within the board and often between the board and members of the management team. The source of these divisions? The members tend to view growth through the lens of their personal experiences--based on what they have experienced and can intuitively manage—rather than according to the success patterns of America's highest growth companies.
To correct this, we apply the 7 Essentials Scorecard in which the board and mangement team members clearly review the implications on the company's strategy to achieve exponential growth and their 7 Essentials Score. Both the board and senior members of the management team should participate.
It is critical that the board is on the same page with the management team, in terms of expectations and values. Especially during a crisis, when the board and management team could be at cross purposes, such planning becomes critical. Disunity at such a time could destroy a management team, and a company.
The discussions will result in a list of priorities that is relevant to the evolution of the company's strategy, its success metrics and the role of the board as it intersects with the revised growth strategy.
