The New Director's chair
Strategy is Not About “The Journey.” You Need Clarity on the Destination.
June 11, 2019
For the next installment of our interview series with top directors, my colleague David Reimer, the CEO of The ExCo Group, and I sat down with Chris Brody, president at Vantage Partners, who has deep experience with boards at companies of all sizes. He shared thoughtful insights on the importance of simplifying complexity to articulate a clear strategy.
Reimer: What have been some of the key lessons you’ve learned from your time serving on boards?
Brody: One is that companies need different kinds of boards at different points in time. If they’re early stage, they need a board that’s going to roll their sleeves up and help them solve certain kinds of problems. And then as the company evolves, the board has to evolve. And sometimes it’s hard for a board to realize when the company is at a point where different directors are needed.
The Intuit board was a role model for me as to how a board can evolve appropriately over time. It had a great chairman – Bill Campbell, who passed away a few years ago. He taught me how incredibly important the chairman of the board is because it’s like an orchestra conductor with an all-star team that doesn’t work for you and a management team that would benefit from your help.
If you sat in the board meetings, Bill might have only spoken 5 percent of the time, but there was this invisible hand that made the rest of the board function really well as a team. There was mutual respect, chemistry, some humor, sharing of ideas, challenging each other in a civil manner, and all along recognizing that the last thing you want to do is embarrass management in front of their own people.
We also did anonymous peer-to-peer reviews each year. Each board member graded each other board member on ten items, and the comments were really helpful. Most of the scores were in a pretty tight range, so when you deviated, you had to ask yourself, is there something I can get better at? The board also rated the board and each board committee, and for a couple of years, we also asked the management team to rate the board.
Reimer: What else is part of your playbook as a director?
Brody: For out-of-town board members, you need a system to develop your relationship with the CEO. Mine was to have lunch with the CEO on the day before the board meeting. When we first started, we didn’t have an agenda. We’d show up and I’d have three things on my list and he or she would have three things on their list. You need that time together to build trust. It was also the best time for politely telling him or her what you thought, and it enabled them to bounce things off of me before it was shared with the broader group.
“The most important thing for effective boards is chemistry.”
The most important thing for effective boards is chemistry. It’s also a fragile thing, and I’ve seen instances when it’s been broken, maybe by the introduction of just one new board member, and it’s hard to put back together again. That makes it much more difficult for people to exchange views and make decisions.
Bryant: What advice would you give to a room full of newly minted directors?
Brody: Get to know the company and its product. Establish a relationship of trust with the CEO and with the CFO, the head of human resources and other key business executives. You’re not going to have an equal relationship with all of them. If you’re lucky, a board in aggregate will have strong relationships with all of them, and you shouldn’t try to have a great relationship with everybody. You’re going to gravitate or interact with people with whom you have a shared expertise.
I’m surprised by the number of board members and even CEOs who struggle with the 30-second elevator speech. If you can’t do that as a board member or you don’t think the company’s done that, one of your jobs is to make sure you and the company get there.
Be respectful of your other board members and recognize that they are a resource to you to become a better board member. There are also challenging issues that don’t just get resolved when everybody walks into the boardroom and they’ve read their board book and now you’re going to deal with them. If you’ve socialized with other board members to better understand different perspectives and to better inform your own point of view, the board meeting will be much more productive.
The last thing I’d say is that if you’re on a board with a lot of great people, don’t try to win the MVP award. Just be a great board member like everybody else.
Bryant: Back to your point about elevator pitches, why do so many people struggle with them?
Brody: I remember going to the Picasso museum in Barcelona. What an extraordinary classical draftsman he was when he was twelve years old. Later in his career, he could create an unbelievable vision with just five brushstrokes, making it look easy. But it was the result of great talent, natural creativity and years of disciplined thinking. It’s hard to go from all the complex detail to an elegant, accurate, honest outcome. And the same is true for companies trying to define themselves in 30 seconds. But it’s important, and it’s a lot harder than people think it is.
But when you get it right, it creates a unifying vision that the entire company can use to focus their energy. It liberates people to channel their resources in a more impactful manner. By the way, if the board’s struggling with the 30-second elevator pitch, maybe there’s something going on inside the company that’s got to be fixed, too.
Reimer: What are the dynamics on a board that would cause you to say, “This is not the right board for me.”
Brody: Loss of mutual respect. Lack of transparency. Excessive defensiveness on the part of management, which is going to make it hard to work with them. The biggest problem a board member can face is that this isn’t the right management today for the company. It’s not a binary decision. It builds over time, it can keep you awake at night, and then the hard part is what do you do about it.
You also have to have a degree of self-awareness about when is the right time for you to leave a board as a director. Am I the right person for this board at this point in time? Or maybe I’ve got too many things going on in my life, the board can live without me, and it’s time to move on.
Reimer: If you were choosing between two similar candidates for a CEO role, what is the X-factor you’re looking at that would make you choose one over the other?
Brody: You have to try to extrapolate their likelihood of success. It’s about leadership.
Are they going to create a culture that is going to result in a more successful company? Are they going to have the balance of personality to enable other people to be better than they otherwise might have been? Are they going to enable teams to function better than they would have if they just weren’t a bunch of all-stars in the same room? And are they going to inspire? When they have to make really tough decisions, will they make them and will they handle them right?
Bryant: If you could only ask somebody one question in a job interview, what would you ask them?
Brody: Are you the right person for this job, and why? I’d ask that because it’s open-ended. You’ll find out whether they’re realistic about what’s involved. Are they appropriately confident? Do they really understand what they’re getting into? What is their own degree of self-awareness and self-assessment?
Bryant: Over your years of giving people mentoring advice, what are the most common themes that have come up?
Brody: There are of course many, but it is often around the issue of strategy with earlier-stage companies. The CEO might be passionate about some idea or vision, but they’re actually not very clear on the destination. And if they can’t describe it to anybody else, they are going to dissipate a lot of valuable resources getting there. I often see too much passion for an amorphous outcome, which confuses people. I remember telling one CEO that I don’t want to hear any more that “it’s about the journey.” I’d like to know what the destination is.
I remember telling one CEO that I don’t want to hear any more that “it’s about the journey.”
If you say you’re in an evolving ecosystem, then to really do justice to the destination, you have to tell us what you think the ecosystem’s going to look like in five years, what your position’s going to be inside that ecosystem, and then how are you going to navigate the change between now and then. And by the way, that’s going to change every time you take a new look at the ecosystem. You just have to make sure you don’t change too much. It’s not black and white, but if there’s no answer, you’re probably going to have a problem.
Reimer: When you think back to your early years, what were your biggest influences?
Brody: I always had a voracious curiosity. I remember after I spent a weekend as a kid with some good family friends, the mother called my mom and said, “My Gosh, Chris asks a lot of questions.” And I was really lucky in that I was exposed to a lot of really great intellectually multi-dimensional people, including my parents, classmates, partners, and, to a huge extent, great CEOs. Maybe it was also because I hadn’t figured out what I wanted to do for a career when I was younger, so I was interested in everything.