Canadian HR Reporter

STRATEGIC CAPABILITY NETWORK'S PANEL of thought leaders brings decades of experience from the senior ranks of Canada's business community. eir commentary puts HR management issues into context and looks at the practical implications of proposals and policies. CANADIAN HR REPORTER CANADIAN HR REPORTER March 24, 2014 March 24, 2014 www .scnetwork.ca EXECUTIVE SERIES EXECUTIVE SERIES 11 11 Karen Gorsline Strategic Capability Dave Crisp Organizational Effectiveness Boards more active in CEO succession planning Boards more active in CEO succession planning e panel on maximizing boardroom ef- fectiveness focused on three areas: pre- sentations and pre-reading; the relation- ship between the CHRO and relevant board committees; and CEO succession planning. While the fi rst two provided helpful reminders and useful insights, the discussion on CEO succession planning provided the most food for thought. Boards have become much more active in CEO succession plan- ning as it has a signifi cant impact on an organization's future. e CEO is both the outward and in- ward face of an organization. e days when a CEO picked board members who would rub- ber stamp the executive's direc- tion and decisions have been chased away by events highlight- ing the board's accountability to shareholders. Boards now more fully rec- ognize they put the executive in place and are directly responsible for appropriate oversight and gov- ernance of her actions. Boards see an opportunity to improve their governance by having an emer- gency, long-term succession plan for that most senior executive. ere are a number of things boards are doing on this front: •Engaging the current CEO in CEO succession planning — this creates an understanding there will be a time to step down when others are ready to move for- ward, and also establishes oppor- tunities for the current CEO to look forward to new challenges. •Looking at potential successors from within as well as outside the organization. •Constraining the existing CEO from using succession as a form of reward system. •Staying more involved in coach- ing and developing the board- CEO relationship over the initial few years. •Identifying future competencies needed by the CEO. •Dealing with issues around the participation of former CEOs and founders in board activity. Are these things enough? No. Most eff orts are focused on im- provements in the current context and do not incorporate enough thinking in terms of the future shape of the organization. Organi- zations need to be asking forward- looking questions such as: Is the organization consider- ing all of the relevant business futures as part of talent develop- ment and succession planning? Many years ago, Shell started actively mapping out multiple scenarios, including extreme or radical situations where the busi- ness model would need to be drastically altered, impacting the required capabilities of the execu- tive and workforce. IBM, well-known for talent development and internal suc- cession, actually faced the need to bring in external leadership as it moved from a hardware manufac- turing, sales and service organiza- tion to a consulting and service provider model. Organizations must consider: What shift in business can be anticipated? Can internal talent prepare to take on new ways of conducting business, and could awareness of the poten- tial change be used to contribute to higher executive engagement and broader capabilities? Is up the only way? For many years, organizations have been encouraging career thinking that lateral moves are excellent oppor- tunities to learn and provide new experiences to promote retention and engagement. However, once an executive indicates a desire to be a CEO or is identifi ed as a pos- sible CEO successor, the organi- zation is set up to have one "win- ner" and multiple "losers." ere has been signifi cant investment in all of the potential successors — is it OK to just accept that the "los- ers" will likely leave because they wanted to be CEO? Is there a way to have all CEO contenders iden- tify multiple career objectives in addition to CEO? CHROs need to broaden their sightlines beyond supporting the board human resources commit- tee with traditional approaches to talent and succession man- agement. ey need to use the opportunity to engage both the senior leaders in the organization and the board committee chairs in planning that is more future- oriented, considers new and dif- ferent scenarios, and looks at cre- ative approaches to developing, engaging and retaining the best senior leadership talent for the organization. These human capital assets represent a significant invest- ment over a long period of time. Mitigating the risk of losing that investment is well worth the at- tempt to think outside the box. Karen Gorsline is SCNetwork's lead commentator on strategic capability and leads HR Initiatives, a consult- ing practice focused on facilitation and tailored HR initiatives. Toronto- based, she has taught HR planning, held senior roles in strategy and poli- cy, managed a large decentralized HR function and directed a small busi- ness. She can be reached at gorslin@ pathcom.com. Directors are people too – poor meetings bore them Directors are people too – poor meetings bore them While listening to SCNetwork's blue ribbon panel outline what executives do wrong in board presentations and how the relation- ship between CHRO and board members should be evolving, I was most struck by the bits of human nature that get in the way. One might think the most ef- fective communication occurs at the top end of companies — otherwise, how could everyone else be expected to be clear and deliver results? The panel un- masked the deep flaws behind that assumption. Almost all of the discussion revolved around the importance of simple, clear communication when conveying information, re- gardless of the audience. Ideally, presentations would also address the audience mem- bers' individual points of view or interests (perhaps prejudices or predispositions might be more accurate). Back in the day, high school teachers would slightingly refer to this as a need for "spoon-feeding." Of course, it just makes sense to put information in terms listeners want. It's not really spoon-feeding but good business. Without careful preparation, the panel noted, board members will drift off , tune out, not under- stand their roles, make assump- tions, ask off -topic questions or derail the conversation — some- times for no reason other than they're frustrated by too much information or too little, or lack of clarity or a sense they're being bamboozled or kept off topic by their executive team. It's human. And on the executive side, noted the panel, some CEOs pur- posely fl ood the board with infor- mation to keep them too occupied to ask good questions the CEO doesn't want to answer, or to drag board members into decisions the CEO wants, without regard for listening to what these wise people — whom they supposedly carefully selected as advisers — have to say. Been there, seen that. ese problems are the same sorts of communication issues at every level of an organization. Would we expect any diff erent just because the entire future of a business, everyone's jobs and livelihoods depend on working eff ectively together, or because board members were specifi cally recruited to add value via their opinions? When meetings go wrong at any level, there will be people who simply react, whose behav- iour becomes more retaliatory or oriented toward "Take over, do it my way" instead of being helpful. Get any group of people in a room and it's not possible for each and every one to have things fl ow as they personally would have them. at may mean people engaging in power struggles, tuning out or expressing frustration. Whoever is in charge of a meet- ing, whether it's the CEO, board chair or a lower-level leader man- aging a team, she has to walk a fi ne line between allowing and encouraging full discussion versus guiding and keeping everyone on track. e more powerful the attend- ees, the more egos in the room, the more diffi cult this becomes. As the panel noted, only ongoing dialogue and conscious planning pave the way for productive dis- cussion, which is the sole purpose of any meeting at any level. Only one thing makes meetings at any level productive — once again, we recognize that is collab- oration, today's newest impera- tive. It's good to see senior board experts acknowledging and pro- moting that. It's great if you can get everyone in your organization working on this basis. Every project gives growing managers a chance to prepare. If they all do, then eventually there will no longer be a need for separate sessions on what makes board or executive meetings ef- fective, everyone will bring that knowledge with them as they are promoted up the line. Dave Crisp is a Toronto-based writer and thought leader for Strategic Ca- pability Network with a wealth of ex- perience, including 14 years leading HR at Hudson Bay Co. where he took the 70,000-employee retailer to "best company to work for" status. For more information, visit www.balance-and- results.com. All execs must master art of infl uencing the board All execs must master art of infl uencing the board As corporate governance becomes more complex and regulatory compliance grows increasingly challenging, com- panies need boards to help them meet more than just basic strategies. Consequently, being able to eff ec- tively infl uence the board has be- come a critical capability — and one that is no longer the sole responsibil- ity of the CEO. Every member of the executive team needs to master the art. Experts like Beverly Behan, who study the eff ectiveness of boards, generally agree it's no longer suffi cient for directors to be the only ones to: fully understand and actively engage in an orga- nization's operation; have clearly defi ned roles; and be in agreement and alignment with the organiza- tion's vision, mission, strategies and operational plans. Senior executives share those same responsibilities. e recent Strategic Capability Network panel moderated by Behan high- lighted a number of common mistakes leaders make that mar- ginalize their ability to engage and infl uence directors. Some of those frequent mis- takes included: presenting too much information while present- ing; reading slide material verba- tim; being too vague about desired results; inability to present a com- pelling case; insuffi cient evidence on key issues; little interaction with the directors; and being less than succinct or clear with the message. e question we need to ask is this: If these are common mistakes at the board level, then what's the likelihood the same mistakes are happening between leaders and their own teams? Since the panel's objective was to provide insights about how leaders can maximize their eff ec- tiveness with boards, I'm curious about the lessons leaders were left with. How many leaders left think- ing about what they could do with this feedback to im- prove the level of infl uence for themselves and other leaders? Trish Maguire Leadership In Action LARGER > pg. 22

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