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Leadership boards for a disrupted future

By Louise Chaplin. Published on 1 June 2016

A new research report, jointly published by professional services advisory firm Alvarez and Marsal and Henley Business School, caught my attention recently. The report, Boards in Challenging Times: Leading through Complex and Discontinuous Challenge, (downloadable here) considers the role of leaders and the board when faced with periods of significant disruption.

With the travails recently facing FIFA, Google, the International Athletics Federation, Volkswagen and TalkTalk, amongst others, it may feel like the report could not have been better timed. Yet it’s difficult to think of a period where one global brand or another facing a crisis or fundamental change.

So I was surprised that the report – which is based on a comprehensive research programme of more than 70 interviews with board members, plus round table events and case studies – found that many boards are poorly prepared for such eventualities. Indeed, the report cites earlier research that found as many as half of top management teams said their boards were divided on the issue of future direction and strategy.

Although board diversity is essential for creative thought and ensuring a spread of capabilities, a board in direct conflict is not going to perform optimally under any circumstances, let alone during disruption.

Types of disruption

The report helpfully defines four types of business disruption:

Disrupting the board table

What this means for boards

Strong, charismatic or successful CEOs can easily dominate a board, particularly if the Chair is weak or ineffectual, and this is dangerous for any firm facing disruption. An autocracy no doubt has some advantages but nimbleness of thought during difficult times is rarely one of them.

Non-executive directors have an important role to play when such dominance exists. They have the strength of experience, the objectivity and, I would argue, the responsibility to challenge a CEO who behaves in this way.

The report describes ‘contextual leadership’ and highlights that different types of disruption require a different kinds of leadership; an entrepreneur to capitalise on market disruption and a change leader to handle business transformation. The range of new skills required can mean changes are needed throughout the board.

Finally, the report concludes with a framework for ‘successfully navigating extraordinary disruption’.  It’s an extremely helpful output from this excellent report, which I would recommend reading in full.

Is your board ready for disruption?

Boards in Challenging Times: Leading through Complex and Discontinuous Challenge makes one thing perfectly clear; no organisation will be able to avoid disruptive times. Whether a business benefits from such disruption, or is weakened – even destroyed – by it largely depends on the composition and the quality of its board.

To date, many boards have developed organically, recruiting into each role almost in isolation. If this report makes you think about the balance of skills and personalities on your board perhaps we should talk. Eton Bridge Partners’ Board Practice specialises in bringing together highly effective boards that have the collective competences needed to deal with change effectively.

Louise Chaplin

Partner – Head of Board Practice

louise.chaplin@etonbridgepartners.com

Louise Chaplin

PARTNER
HEAD OF BOARD PRACTICE

Specialising in executive search within board level positions, Louise’s unique combination of expertise and experience enables her to work closely with both clients and candidates at a senior level to ensure the best possible outcomes.

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