Boards are expected to drive company success. Your board’s strategic leadership can create value; its absence can destroy the company. To help directors who want clarity around their input to strategy, we’ve published this comprehensive checklist to prompt your thinking and help to proactively identify issues. The questions will help even if you are an experienced director, and/or if you have already served on this board for a while.

The questions below provide comprehensive coverage across:

  • Who does what (or Delegations)
  • Strategic plan duration
  • Planning methodology
  • Review and contingency
  • Alignment with budget
  • Documentation and communication

The questions are designed to start you thinking about issues that you may have noticed but not yet considered addressing as well as to help you to notice issues of which you may currently be unaware. The answers are not necessarily good or bad; they should reflect the current and desired state of your unique board and company.

Don’t ask all of the questions. Trust yourself to recognise and ask the most important ones. You can return to the list at intervals to consider your progress. We recommend using the list to stimulate your thinking:

  • Before or after a contentious decision
  • Before and after developing and reviewing strategy
  • When preparing for the AGM or other shareholder meetings
  • Before undertaking any major change in company direction or purpose

At the end of the check list, we have listed some references that you may wish to investigate for additional reading on the topic. We have also included some suggestions for putting into action the ideas that result from considering the checklist.

Who does what?

1. Has the board considered and communicated a statement of matters reserved for the board
 
1?
Click to add this item to your personal checklist
 
2. Has the board delegated everything that falls outside of that statement to the CEO for possible onward delegation?
Click to add this item to your personal checklist
 
3. Is the executive team (CEO and direct reports) experienced in the business, skilled at strategy development, and capable of investing time into strategy development without letting performance slide?
Click to add this item to your personal checklist
 
4. Do the directors possess skills and insights that might be helpful in developing the strategy?
Click to add this item to your personal checklist
 
5. Is there a committee, or a subset of directors, that can usefully take on a strategy development function?
Click to add this item to your personal checklist
 
6. Do the board and/or executive team have access to independent expert information on industry trends?
Click to add this item to your personal checklist
 
7. Do you want or need help from an expert strategy consultant? In which areas? How would the strategy consultant interface with the board and executive team?
Click to add this item to your personal checklist
 
8. Have you communicated to management which parts of strategy development are to be done by them alone, which are to be done together, and which are reserved for the board? Have they confirmed their understanding and provided a schedule of when matters will be addressed and when board decisions are required?
Click to add this item to your personal checklist
 

Strategic plan duration

9. How fast is the pace of change in your industry?
Click to add this item to your personal checklist
 
10. How long is your product lifecycle? Are you a cutting-edge developer of new products, a fast follower, or an efficient mass producer of well-established products?
Click to add this item to your personal checklist
 
11. How long is the life of your company’s major assets? How many assets do you create
 
2 and how many are created for you? How quickly do new technologies become proven and adopted?
Click to add this item to your personal checklist
 
12. What is the average industry experience of your staff? How much experience do they gain with your company and how much is gained elsewhere?
Click to add this item to your personal checklist
 
13. How long does it take to train staff for your business? What is the pipeline for specialist roles that may be critical to any strategy?
Click to add this item to your personal checklist
 
14. Are there any talent availability issues that may restrict (or enable) certain strategic choices?
Click to add this item to your personal checklist
 
15. What is changing for your clients and/or customers? How fast is the pace of the changes? What are the implications of those changes for the need for your products and services?
Click to add this item to your personal checklist
 
16. Are you accumulating cash, paying dividends, burning cash, or raising cash? What time horizons are associated with changes in your financial structure?
Click to add this item to your personal checklist
 
17. Do you receive any government or other grants? What conditions attach to those? How long is the funding horizon?
Click to add this item to your personal checklist
 
18. How long is your current strategic planning period? Does that seem appropriate?
Click to add this item to your personal checklist
 

Planning methodology

19. How is strategy made in your company? Is there a clear period of data gathering, followed by analysis and understanding, then generation of options, before selection of an option
 
3? Who is involved in each stage? Is the board involved in authorising transition between stages?
Click to add this item to your personal checklist
 
20. Is there a planning model that structures your inputs and analyses, or do you prefer a series of free discussions?
Click to add this item to your personal checklist
 
21. Does the planning methodology incorporate uncertainty allow for the generation of options?
Click to add this item to your personal checklist
 
22. Does the process capture and record decisions as they are made?
Click to add this item to your personal checklist
 
23. How do you keep track of data that is verifiably correct but does not fit the planning paradigm?
Click to add this item to your personal checklist
 
24. Where do you store the data that you generate during planning so that it can be accessed and used again if need arises?
Click to add this item to your personal checklist
 
25. Do the individual directors each rigorously assess the plan, using their own preferred method/model to gain insights, before endorsing the plan that management bring to the board?
Click to add this item to your personal checklist
 

Review and contingency

26. What process do you use to review the plan? When are the key milestones scheduled for reporting to the board?
Click to add this item to your personal checklist
 
27. Does the CEO’s regular board report contain clear reference to the plan and its implementation?
Click to add this item to your personal checklist
 
28. Are there regular discussions, with substantive input from the board, on the rate of progress and the performance achieved?
Click to add this item to your personal checklist
 
29. Is it clear how contingency plans or amendments will be triggered?
Click to add this item to your personal checklist
 
30. What is the acceptable deviation from plan and how will you know when performance is within the acceptable range?
Click to add this item to your personal checklist
 
31. Who endorses a change from base plan to contingency plan? Is this different for varying levels of financial, environmental, reputation, or social impact?
Click to add this item to your personal checklist
 
32. Do you need to communicate plan progress and changes outside the board and management teams? How will you keep stakeholders aware of implementation?
Click to add this item to your personal checklist
 
33. What KPIs measure implementation? What KPIs measure success? Which KPIs will be reported to the board? At what frequency?
Click to add this item to your personal checklist
 

Alignment with budget

34. How do the planning and budget cycles interrelate?
Click to add this item to your personal checklist
 
35. Is the level of detail in the first year of the strategic plan sufficient for the development of a budget?
Click to add this item to your personal checklist
 
36. Do the allowable variances from budget align with the accepted performance envelope for the strategic plan?
Click to add this item to your personal checklist
 
37. Are there functional and operational plans, based on the strategic plan, that support activity costed budget development?
Click to add this item to your personal checklist
 
38. What are the incentives to management for basing the budget on last year’s performance rather than this year’s strategic plan? How will you outweigh those incentives so that strategy drives the budget?
Click to add this item to your personal checklist
 
39. What elements of strategy need to be reported together with the budget reporting?
Click to add this item to your personal checklist
 

Documentation and communication

40. Has your board disclosed previous plans, or elements of these? To whom do you need to disclose this plan?
Click to add this item to your personal checklist
 
41. Is a simplified version needed for public disclosure? Do other stakeholders need a detailed version for incorporation in their own plans?
Click to add this item to your personal checklist
 
42. What are the scheduling constraints on external communication of strategy?
Click to add this item to your personal checklist
 
43. How will the strategy be shared with the staff who implement it? What actions will ensure key messages are not lost as repetitions of the strategy ‘cascade’ down through the organisation?
Click to add this item to your personal checklist
 
44. Do you have a practice of ‘town hall’ meetings with staff where they can hear, and ask, about the strategy?
Click to add this item to your personal checklist
 
45. How will you ensure staff have the correct version of the strategy? How will you communicate revisions?
Click to add this item to your personal checklist
 

Taking action

Read the questions and note which ones you can confidently answer. Make a record of any actions that you wish to take to help answer any questions that you were not confident about. Schedule those actions as immediate, at the next board meeting, at the next in camera session, at the next strategic retreat, or within the next year.

If you are the chair, you may wish to have a conversation with the board about the most relevant questions at the next meeting or at the board’s next strategy workshop. If you are not the chair, you may wish to have a conversation with the chair about your observations.

Additional reading and reference sources

Boards That Lead, R Charan, D Carey and M Useem, Harvard Business Review Press, 2014

The Future of Strategy: A Transformative Approach to Strategy for a World That Won’t Stand Still, J Aurik, M Fabel and G Jonk, McGraw Hill, 2014

Directors at Work, G Kiel, G Nicholson, J Tuny and J Beck, Thomson Reuters, 2012

The Strategic Board: The Step-by-Step Guide to High-Impact Governance,  M Light, Wiley, 2001