Platt Perspective on Business and Technology

Joining, serving on and leading a board of directors – 19: conflicts, disagreements and consensus building within a board

Posted in job search and career development by Timothy Platt on November 2, 2011

Board members advise the CEO of the organization they serve on the board for, and both individually and as a group. They also, as a core responsibility play crucial roles in helping the business deal with and resolve what are among the most challenging crises that any organization can face: crises in leadership at the top. This is my 19th installment in a series on serving on and leading a board of directors and I turn in this posting to examine some of the issues that board members face when working together in carrying out these responsibilities.

Ideal boards of directors may always be closely coordinated and they may always function smoothly and with easily established, harmonious agreement. Real boards have to deal with and resolve conflicts and disagreements within their ranks that can and do arise between members and between member factions. These challenges to board effectiveness and functionality can arise from differences in personality and background. They can arise from differences in approach in deciding and evaluating business processes or strategy and their execution, or from differences in tolerance for risk. They can develop as a result of different board members holding different and even starkly divergent views as to where the business is now and where it should be going, or of how it should get there.

Usually disagreements stem from a combination of these factors, and I add one more to this still incomplete list of reasons: momentum and patterns of response that can and do arise from past agreements and disagreements, and that may include unresolved or partly resolved issues that come in from outside of the business or that board itself, but that still find their way into discussion and decision making processes there. This is the complex of issues and complications that I will write of here in this posting – along with the issues of consensus building and developing and following a path forward past these apparent obstacles. (See my Guide to Effective Job Search and Career Development – 2, postings 179-196 for parts 1-18 of this series.)

• Board members can and do disagree. A first point I would make here is that some points of disagreement are minor and even trivial – and that importance and priority should be measured entirely in terms of impact on the organization.

Minor and throw-away issues are ones in which either side of a disagreement could simply concede the point and know that there would be no consequences on the business, its marketplace position or strength, or its due diligence or risk remediation concerns. Significant issues are ones where decisions made would have significant impact, and short term, longer term or both. And this two observations mark off extremes on a continuum.

• Before you can resolve an issue with other board members you have to reach agreement as to what the actual issue is, and on where it resides on this continuum.
• So start by working together so that you can identify and address possible disagreements, speaking the same language and making or at least understanding the same underlying assumptions as you do so.
• This means putting the issue in contention in context and acknowledging that different people might see different context features as more significantly involved there. One board member may, for example, be looking at a point of disagreement from a marketing and public relations perspective and through their prism of their own business experience and another might be viewing what is ostensibly the same issue from a very different finance and budget perspective, and from their hands-on business-experience perspective.
• When people disagree because they start from different types of position and perspective, there is more ground to maneuver on in developing a consensus as each side presents its case and a combined context perspective is found that includes elements of both (or all) initial understandings.
• When people disagree fundamentally, and even when looking at a problem or difference with a clear and essentially similar set of starting assumptions, consensus building becomes much harder.
• So look for the differences in perspective and context instead of just to the end-point issues of disagreement that stem from them, and negotiate there.

Sometimes board members reach consensus and sometimes they simply have to agree to disagree. And here is where an oft-repeated point comes up again. Boards and board members do not run the business or organization they are serving as board to. The CEO they advise holds responsibility to do that. So there is no problem if a board simply presents alternatives and their reasoning as needed. The important thing is that this not simply be done as throwing incompatible and incommensurable alternatives at the CEO as board advice that they cannot reconcile – except through ignoring board advice and taking unilateral action.

• So this is about board effectiveness in advising the CEO and through them their executive team and the business. But it is also about board credibility.

Turning to my board taxonomy again to put that into wider perspective:

• A rubber stamp board cannot come to agreement because they cannot form real opinions to distinguish between.
• A ruggedly independent board can and will find points of disagreement but they cannot and will not try to reconcile them amongst themselves, so they will always present indigestible and contradictory “advice” to the CEO – who will see them as less helpful and less significant to the real decision making process every single time. And as a result they will be that much less in a position to carry out any due diligence or oversight roles they should be on the board to provide.
• Only a strategically aligned board can constructively disagree, coming to better conclusions as a result – and offering real value to the CEO, their executive team and the business as a whole.

I have written about boards and board members advising the CEO when everything is proceeding smoothly, and I have written about boards dealing with crises of leadership up to and including ones where a CEO would be dismissed. I am going to turn in my next posting to a more common middle ground where there may be disagreements between board and CEO but they are not of crisis significance. I will post in my next series installment on negotiating with the CEO, building that on a foundation of first having negotiated shared understanding even if not agreement within the board.

I have been posting on the general topic area of jobs and careers to my Guide to Effective Job Search and Career Development directory. I have recently started a second, continuation page to that directory at Guide to Effective Job Search and Career Development – 2 and you will be able to find this and subsequent series on jobs and careers there.

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