Female executives packed the room as former Xerox CEO and Chairman Anne Mulcahy took the stage at Fortune’s Most Powerful Women Summit to share her best and worst practices on building boards. Throughout her career, Mulcahy has sat on boards of six public companies, three non-profits, and one privately held international company. “Sometimes, I did not choose wisely,” she recalled. “There were some tough mistakes to rectify.”

Though she hasn’t been on half as many boards as, say, Frontier Communications (FTR) CEO Maggie Wilderotter, Mulcahy claimed the diversity she’s experienced on boards – the good, the bad, and the ugly – is what makes her a good source on the topic.

“Do your homework,” Mulcahy began – and she doesn’t mean studying companies’ 10Ks. “Understand the caliber of the CEO and the management team [of the company]. Do your homework on your fellow directors…[Ask yourself] is it a club I want to be a part of?”

Mulcahy also warned against joining boards that are looking for women. “It’s a bad sign. Boards without women – blacklist those suckers. It’s 2011. They’ve had the time – it’s significant that they don’t have women.”

Her final advice? Work hard. “I have zero tolerance for people who don’t come completely prepared. I expect contribution, I expect attendance, and I expect directors to take trips and visit the company’s programs.” And stay away from directors that are on boards “just to show how smart they are.” You know, those who speak just to be heard. They tend to create more work than value, according to Mulcahy.

Though some boards and CEOs get a bad rep for being too buddy-buddy, boards are more successful when they have good relationships with their companies’ leadership teams, Mulcahy said.

Read the rest of the article here.

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Today, I was intrigued by a trailer headlining “5 ways training can propel women into the Boardroom” (http://www.trainingzone.co.uk/topic/five-ways-training-can-propel-women-boardroom/157604), an article posted by Mui Li of Muika Leadership who has been researching the role of women in leadership.  She interviewed 50 women in senior positions and investigated how they achieved success.  The 5 key things which identified as making a difference were as follows :

1 The Opportunity to develop confidence and self-belief
2 Mentoring
3 Family
4 Leadership development
5 Motivation

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The critical role of not-for-profit organizations in civic society and the importance of a healthy civic society to democracy mean that this is an imperative for the sector.

I’m searching for new trustees and a chair in two organizations currently – an international federation and a mid-sized local charity. Unsurprisingly, given the external environment, both organizations are searching for non-executives with proven expertise in managing business and fundraising.

These searches have thrown into sharp focus the challenges of a voluntary board, and even with “top notch” trustees, how hard it is to achieve these aspirations for high performing boards in the sector.

The case for the role of the board in terms of oversight and independent challenge has been made time and time again, particularly in terms of some high profile failures of both public and private sector organizations over the last couple of years. The nub of the matter is how to get the board of a voluntary organization to work given the inherent difficulties and constraints that confront it.

It’s a matter of time

Non-executive directors or trustees only spend a very limited amount of time working together as a board – in many cases they spend less than one working week together each year. Paradoxically, in my experience, the smaller organizations often need the greater time and focus from the board because of executive capacity and shoestring resourcing. The role of the trustee non-executive director takes time, and even given enormous commitment to the organisation and its’ mission, it is difficult for people to find the time that’s needed.

Just like the debate over allowances for local authority councillors, it is easier for people to participate fully in voluntary boards who are retired or who have enough personal wealth that they don’t need to juggle voluntary commitments with a need to work. Yet we all know that diverse backgrounds, skills sets and life experiences create environments where insight and innovation can flourish.

Time is an issue because we need effective team working, insightful analysis and challenge.  It’s just not possible to create a high performing board that goes beyond oversight and solvency to strategic and generative thinking that guides the organization to achieve its mission.

A number of mitigations have been developed in terms of the modus operandi of the board:  We make sure that board papers are sent out in plenty of time. We strive to ensure that board papers are concise with appendices containing background detail. We come to agreement about whether evening or day-time board and sub-committee meetings work best. We have “away days” and board retreats. All these things help mitigate the situation, but in my experience the core issue remains.

Should we pay our trustees?

I know that Kevin Carey’s views as chair of RNIB, about current governance mechanisms being ‘bust’ and suggesting that trustees should be paid met with a mixed reception last year. Charity Commission guidance on payment of trustees for their role of being a trustee is permitted in very limited circumstances (CC11). But I do think that this area could be explored further to see if it helps address the issue of time as a major impediment to high performing boards. Members of NHS boards are paid modest salaries for their work, and public roles like Mental Health Act Hospital managers get paid for attending each meeting and for every tribunal on which they serve.

Would modest payment for being a trustee of a charity solve the issue of lack of time? I wonder whether any research has been undertaken which compares the functioning of NHS boards and not-for-profit boards? This is certainly an area I’m going to investigate further.  Would appreciate your views and pointers…

(And an interesting postscript – my friend Jan who runs a social enterprise delivering HR services to CSO’s in the UK, has just told me that of the 48 new clients that she has taken on this year, only one of them has a formal selection process for recruiting board members! I’ll explore trustee recruitment in a subsequent article…)

Judith Davey (pictured) is director or performance & accountability at ActionAid and is currently studying leadership and governance at the Harvard Kennedy School of Government

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In essence they say that Generation Yers represent more reward than risk if managed well and properly understood, and they provide a good summary of their behaviour and expectations  (http://www.growingbusiness.co.uk/why-gen-y-is-good-for-your-business.html?utm_source=twitterfeed&utm_medium=twitter).  However, they don’t provide much in the way of guidance into how you can manage them to higher levels of performance and results.  So , in brief, let me fill the gap.

Three headlines to remember:

Focus delivery
- Make sure that your organisational purpose has the context that has real meaning for them so that they can connect and engage with it
- Inspire and energise them ( a challenge for some managers)
- Become their performance coach and partner, rather than manager
- Win and maintain their respect (and that does come from some naff attempt to be cool)

Create the right context for performance
- Genuinely put people at the heart of your performance 
- Be consistent.  if you claim to be ethical ( a hit with Gen Yers) make sure that you are truly ethical (inside and out).  If words and actions don’t match up they will leave (mentally or physically)
- Provide opportunity and variety
- Stimulate and challenge them and provide a society in which they can operate and feel at home

Maximise capability
- Understand their individual aspirations and motivations
- Help them to achieve personal mastery of their roles
- Review their performance very regularly and give immediate feedback
- Give them responsibility and autonomy.

So, there you have it, a simple recipe for success in managing and leading Generation Yers based on how they have led their lives and the world in which they have grown up.  

But, funnily enough, is seems remarkably close to what we should do for any of our staff, Baby Boomers, Gen X, Y or Z.  Perhaps they are a little more demanding, but good for them and perhaps this blog is just a reminder of the good practice that you should be adopting anyway; what’s your excuse?

Warming to know that family relationships remain so strong despite what we are led to believe by the press, and especially so in the pressure cooker of entrepreneurial businesses fighting the effects of a recession.

Sad though that they are struggling to find the necessary advice and that they are having to rely on their spouses. Why? Because it is unlikely that their spouse is as objective as required nor is it likely that they have the skills or experience to provide the quality of advice needed.

Yes, I know the survey reports that 80% of the small businesses polled stated they take advice from people who will give them the truth and will tell it to them straight, but straight doesn’t necessarily mean valuable advice nor result in improved performance.

And for me, this where a non exec can rally add value to a growing business. The attributes of the best non execs for SME’s are:
- straight talking, challenging and yet constructive
- because they have previous entrepreneurial experience, and
- they can take an objective view, complemented by
- commercial nous

I don’t know about you, but not many spouses can bring those qualities to the business.

But this doesn’t solve the core problem that the survey highlights; that SME’s are having trouble finding the support they need and are having to turn to their spouses to fill the gap. And this points to the need much greater availability of NED’s for SME’s.

Currently:
- There aren’t enough NED’s readily available with the special skills or experience required for the SME environment (it’s very different from the corporate world)
- There isn’t the support through training and development for potential NED’s in order to address the supply and skill shortage problem
- There isn’t the marriage-broking service (to use a pun suitable for this piece) to bring businesses and NED’s together.
- And there is the need to ensure that businesses know how to best use their NED for maximum results

Deal with these issues and entrepreneurial businesses can be helped to growth faster, and perhaps husbands and wives can go back to caring about each other on a personal basis and simply enjoying the fruits of their endeavours.

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That is the view of Tim Campbell, former winner of television competition The Apprentice and chief executive officer of the Bright Ideas Trust, who has said that a support structure must be put in place to help the country’s smaller companies in these tough financial times.

This would help such firms to avoid the same “pitfalls” and “mistakes” made by organisations in the past, he remarked.

“There needs to be mentors for small businesses,” he added.

Mr Campbell’s comments came after his appointment last month by the Greater London Authority as mayor Boris Johnson’s ambassador for training and enterprise.

He went on to state that while many companies are happy to act as “one or two man bands”, financial and mental backing must be available for those firms that “want to grow”.

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But, be warned …

Interims from majors can’t just think they can get away with operating in the same way they do in larger businesses.  They will need:

• much greater flexibility and a broader range of skills
• to pick up their own pace to match the environment
• to be much more entrepreneurial, and
• they need to recognise that they will have to deliver with fewer assets and resources behind them than they are used to drawing on.

So do it as a career choice, not just as a reaction to a job advert.  The entrepreneurial world is different and for many the adjustment is just too great.  For others though, it is the only place to be.

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Free download
You can download the full survey results and report What makes an outstanding FD? as a free PDF. Or, to read just the key findings, see our post on Elevate – for business leaders

To be outstanding, our interviewed FDs listed the top key attributes:

• Excellent communication skills – with the board, across the business as a whole, and with shareholders and the outside world.
• Wider people skills, particularly the ability to lead a high-calibre team.
• Commerciality and in-depth understanding of the business, its markets and customers.
• The ability to support and challenge the chief executive.
• An affinity with numbers and the ability to interpret them for others.

Today’s outstanding FD has emerged as a much more rounded, commercial business leader than his or her counterpart of 10 or 20 years ago. He or she is a great communicator who can win the trust of colleagues across the business and is a partner to the CEO – and very often a CEO-in-waiting.

Many of the outstanding FDs nominated in the report were qualified accountants – though there are a few exceptions – and most started their careers in a professional firm. Some had augmented their professional qualification with an MBA, which they said gave them a broader base of understanding than the essential but ‘narrower’ accountancy qualification.

The career themes for outstanding FDs were:

• They grasped opportunities – even if it meant doing projects or roles that were not particularly appealing. This got them noticed and earmarked as someone with high potential.
• Those who started in the profession mostly moved into industry as quickly as possible.
• Most deliberately looked for ways to add value to their CV early on.
• They quickly built up a variety of experience in a number of roles, sectors and geographies.
• They pushed themselves out of their comfort zones into situations often seen as beyond their capability – and often this was the thing that made their careers take off.

A lot of the FDs we interviewed talked about learning from watching those around them – spotting what impressive people were doing and adopting these behaviours. A number also talked about seeking out mentors and asking “first-class people” to tell them how they were doing.

There was no sense of ever feeling an outstanding FD has learnt enough – no matter what level they had reached, all were keen to keep learning, even from the younger generation.

International experience is a bonus
Most of our outstanding FDs had worked in international businesses at some stage of their career – and invariably said yes to projects and promotions overseas. This exposure to global business and different working cultures and mindsets had proved invaluable in landing top jobs later. Today, with international trade being the norm for most businesses, this experience is perhaps more important than ever before.

Going overseas often provides the opportunity to do more variety of work and at a more senior level than could have been achieved in a head office, “doing many more things than you normally were allowed – the sorts of things you don’t normally see till you get to the very top”.

Networking vital for visibility
Most agreed that headhunters had been important to them and while networking was not seen as a natural activity for many FDs, all our outstanding FDs had learnt to become better at this and had become more visible as a result. All agreed that networking is an important skill for an FD if they want to progress.

Our respondents said:

“I managed to change every Unilever subsidiary I worked for by a bit, had them adapt to how I liked things to be done. So Unilever sent me to France. I couldn’t change France. They knew that and they taught me to adapt to France. The language was a practical skills challenge – it took me six hours to clear my mail every evening until I became fluent. It made me understand I needed to listen.”
Sir Richard Lapthorne, Chair, Cable & Wireless Communications Plc

“I chose to join a Big 4 firm in Birmingham in preference to London as I was interested in the industrial sector, and I got to work for clients such as Jaguar and GKN.”
Neil O’Brien, CEO, Alkane Energy Plc

“The big turning point was joining Whessoe Group as financial controller.  Within 12 months, my FD left and I was offered the opportunity to be Group Finance Director of a Plc at 33, which I took with both hands. It catapulted me into the arena where everybody knows who you are, your name gets mentioned.”
Barbara Richmond, Group FD, Redrow Plc

“I had some great opportunities early in my career which required moving overseas to not-so-attractive places.  I shied away, sticking to London. If I’d gone overseas, my experience would have grown far more rapidly and I’d have learnt much more about the world rather than being just UK-centric.”
Richard Guest, CFO, Stock Spirits Group

“You’ve got to stretch yourself as soon as you’re getting to your comfort level, what you really need then is another challenge and that’s how you get big jobs at an early age.”
Richard Ashton, Group FD, Home Retail Group Plc

As always, we welcome your thoughts on this and any other aspects of the What makes an outstanding FD? report. Inherent in any top-performing organisation is an effective top team. For our approach to reviewing board effectiveness (required under the Combined Code), please visit our Governance Advisory page.

Originally posted here

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Because every success and failure I have experienced in business seems to have revolved around these three big issues.  And the biggest one is Clarity.

Clarity

Clarity is about getting everyone (and I mean everyone) understanding what you are trying to achieve.  And not at some easily achieved superficial level.  Deep, very deep understanding is required otherwise people wander off doing their own thing, because they fancy it, or because they just want to carry on doing what they have always done; it’s easier after all.

Call it purpose, vision or mission or whatever you like; I really don’t care The harsh reality is that you have to give your business a laser like focus on something really valuable: valuable to your customers so that they want to buy it, and valuable to you so that you make money out of it.

Clarity focuses resources, mindset, energy, skills, behaviour, people, suppliers …. Clarity focuses everything.

Clarity removes waste more than any smart assed accountant can ever achieve, however much they cut and chop bits out of budgets.

Clarity provides a decision making filter  for everyone in the business to use.  That means you make better decisions at board level, but more importantly it means that your teams can make decisions on their own, without continual reference to you.  And that means they can do things quicker; they  become more capable; they are more motivated; they look after your customers better and your business becomes more reliable and effective

Clarity means that your customers understand what you are about and what you offer them.  If makes them confident to come back and buy more because they know how you will behave and what you will do.  They also feel confident to recommend you to their friends.

Indeed you know you really have clarity when your customers relay the same picture about what you do as you do.

And if you haven’t got it?  Often you will see conflict and hear flatulence.  Neither are much use.  Conflict arises out out competing agendas rather than shared beliefs and distracts from delivery and execution.  Flatulence shows up as wind and is evident to staff and customers alike and normally is experienced by way of unreliability, false promises and a failure to deliver.

So, love clarity with a passion.

I will come back to how you achieve this depth of clarity in the next few editions.  Equally, I will come back to Commitment and Capability in later editions and for now will just provide a brief overview.

Commitment

Once you are clear where you are going, you have a chance of winning the commitment that is necessary to execute your plans in a sustainable way.

Commitment shows itself in an unswerving determination and perseverance to deliver.  It is a passion to perform amongst all your staff and a passion to buy repeatedly amongst your customers.  It is motivation and pride and energy.  It is about people being innovative;  innovative in how they do they job, how they find solutions, how they manage and lead, as well as being innovative in delivering new products and services.

It is all these things because it is about lots of people doing something together that they believe in and want to see succeed.

But that success is shared; it is an aspiration for success for the business and for themselves personally. Therefore to win commitment you must ensure that you focus on the reward for the organisation and for your staff.  And in this regard, I mean reward in the widest sense; motivation, growth, opportunity, recognition, personal development as well as pay.

Capability

And finally, when the wheels hit the road, your business and your staff have to have the capability to perform and deliver your aspirations. That will mean you have the skills, culture, knowledge, resources, know-how, controls, experience, connections, distribution, technology, processes, products, cash, brand and leadership to succeed.

I am sure that you have heard of the story of the three little pigs and their battle to survive the desires of the hungry wolf.

And perhaps you will have recognised that each of these pigs starts the story with differing life experiences, personalities, expectations and skills. Yes, I know they all lived in the same maternal home, until their mother rather dispassionately threw them out on their own and subjected them to a dangerous world where wolves lay around every corner. But there were differences in their characters, with the result that they each found different solutions to the challenges they faced.

But boy, wouldn’t it have helped them if their learning could have been accelerated and they could have found a solution to that hungry old wolf earlier in the story?

And this is the challenge for all of us on the buy side, so we need to make sure that they do will do the job, and quickly and that the lessons will translate to business, and quickly. Obviously the truth is no programme can satisfy all the people all of the time, but they can ensure they include a mix of approaches to learning that best seek to address the differing needs.

Normally, that isn’t so much about the content but howe the porgramme is delivered. So ask yourself whether the programme and its contents have been built to make that they are;

Accessible – will you understand it and is the material delivered in a mix of ways that recognise my learning style (e.g. touching, looking or doing)?
Memorable – will you be provided with learning triggers that will resonate and last over the long term?
Applicable – will you be provided with knowledge and solutions that can be applied for real impact on a day to day basis?

And in an SME (and for us at the Non Exec Academy), this last criteria is the most important of all – so dig deep and find out whether the programme really has been built with a true understanding of, and focus on the world that entrepreneurial companies operate in, or whether it is just another rebadged and bland corporate course.

Obviously, there are no definitive answers and often you have to make comprises to make the programme work but if the right approach had been taken with the development of three little pigs, then perhaps they would have found that their solution lay in a well-aimed gun much earlier in the story and they could have saved themselves a lot of trouble.

And what has this got to do with Prime Ministers? Absolutely nothing, but perhaps it caught your attention, made you take notice and made you think about your what is right for your growth business.