Few areas are as contentious as the role of the board in strategy. Some boards delegate strategy to management and endorse or reject the resultant plans, others craft the vision and delegate the planning to achieve it, still others create detailed plans and delegate the doing to management. Whilst there are commonly acknowledged ‘wrong ways’, there is no single ‘right way’.

Most boards recognise that forming a partnership with management allows valuable contributions from the directors as well as the senior executives. We refer to this as building a strategy partnership. The exact form of the partnership and the role of each partner will vary from board to board and from time to time. We have created these questions to help you to build a stronger partnership that allows more value to be shared.

The questions below provide comprehensive coverage across:

  • Understanding the roles
  • The impact of organisation, board and management maturity/capability
  • The natural frictions
  • Agreeing a framework
  • The role of the strategy offsite
  • Ongoing iteration
  • The role of the CEO and Chair
  • Monitoring and review
  • The strategy cycle
  • Values, purpose and vision
  • Horizons and groundwork
  • Skills and Knowledge transfer
  • Setting the boundaries
  • Monitoring and review
  • Contingency and change

The questions are designed to start you thinking about issues that you may encounter. Your answers are not necessarily good or bad; they should reflect the current and desired state of your understanding of the board and its role in your company.

Trust yourself to recognise the most important questions to help you get the best possible relationship with your board and directors.

At the end of the checklist, 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.

The strategy cycle

 
1. Does your board have an annual board agenda that schedules topics for discussion at the board’s meetings? When does strategy arise on the agenda?
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2. Does strategy arise at different times throughout the year as the plan progresses?
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3. When you have a strategic discussion on the board’s agenda is it given sufficient time? Do you need to move these discussions towards the end of the meeting so that they do not get rushed because other items are following, or towards the beginning of the meeting so they do not get curtailed by directors’ travel and subsequent commitments?
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4. How long is your strategic plan? How does the length of your plan compare to the lives of your major assets, the funding cycle, the length of projects, etc.?
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5. Do you refine your plan on an annual cycle or do you run for several years before readjusting and developing a new plan? Why? What are the pros and cons of planning more or less frequently?
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Values, purpose, and vision

 
6. What was your company founded to achieve? Is that still your main purpose? Is the purpose compelling and clear?
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7. If your purpose has changed, what caused the change and was it instigated by management, the board or both together?
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8. Is your purpose consistent with management’s experience of stakeholder needs, emerging trends and competitive position?
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9. Who feels most passionately about the organisation’s purpose? How is that passion articulated and shared as a commitment to achieve your aims?
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10. What will the world look like when you achieve your purpose? How closely aligned are the views of the board and management?
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11. Is any part of your purpose not clearly understood or defined by the board? What is the role of management in clarifying, defining and extending your purpose?
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12. What values do you believe to be important? How does that drive the behaviours of people within the company?
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13. How does the board ensure that management understand the values and exhibit the behaviours that are required to achieve the purpose in a manner that will be acceptable to the board?
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Board foundations

 
14. Do all members of the board have sufficient industry background and understanding?
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15. Do all members of the board understand the strategies of the largest or most relevant competitors
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16. Is there appropriate board education
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Horizons and groundwork

 
17. Do the elements of your strategy combine and reinforce each other to generate momentum?
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18. Is management able to create a strategy to achieve acceptable progress in each of the key results or focus areas?
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19. What must be achieved in the current plan period? Is it clear that management has been delegated sufficient authority to achieve this progress? Are decision and approval thresholds and times clearly identified, communicated and understood?
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20. What must be done in the current period to build a foundation for success in the next planning period? How will you know that it has been done, and done well enough?
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21. Has the board set KPIs that will incentivise the work required to achieve this plan and to build the foundation for the next plan?
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22. Who is best situated to perform environment scans and identify new trends or ideas that will enrich the planning process in future? How do you create a forum for sharing these ideas?
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Skills and knowledge transfer

 
23. How does the length of your strategic plan compare to the average tenure of your board members and the members of the senior executive team? How will you manage the knowledge transfer required as people leave the organisation and are replaced by new recruits?
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24. What are the key relationships required for strategic success? Who holds these relationships, is it the board or management or a combination of both? How are the relationships transferred from individuals to the organisation?
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25. What problems does the company face at the moment? What problems does it expect to face as it implements its plans? Who has experience or skills to solve these problems?
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26. What technologies or changed expectations affect the implementation of your plans? Who has the skills and experience in these technologies? How will these skills and experiences be transferred from the relevant individuals to the whole team?
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27. How often do the board and management come together to share and transfer knowledge? Is that enough for the volume of knowledge that you need to transfer? What changes will you make to your board annual agenda to create sufficient opportunities for knowledge transfer?
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Monitoring and review

 
28. How is progress monitored?
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Contingency and change

 
29. Does the change need to be disclosed to stakeholders outside the company? Are there any new communication processes or protocols required?
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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.

The best time for reviewing the ‘line’ between management and the board is at a regular review of delegations. However, the most common time for reviewing this is when a decision becomes necessary and there is contention about where it should be made. Sharing these questions with your board will help you to reach a consensus on where and how to make the decision.

When you have reached board consensus make sure that you document and communicate changes in a consistent fashion until they become established as the new status quo.

Additional reading and reference sources

Boards that Lead, Ram Charan, Mike Useem and Denis Carey

Governing in Scary Times, Debra Brown, David Briwn, and Rob Derooy