Great Boards Have Great Dynamics

So, how do you move the performance dial of your board? First of all, let’s recognize that boards are social systems—their own unique “teams.” Why is this important? According to a study by Solange Charas, “The impact of [a] board functioning as a team is an eight times greater predictor of corporate performance than individual director demographics.”

“The impact of [a] board functioning as a team is an eight times greater predictor of corporate performance than individual director demographics.”

The first step in creating any great team is getting the talent right. In the boardroom, this means a candidate should have highly developed business skills that match the organization’s needs and help drive its vision and business model. To avoid group-think and to stimulate meaningful discussions, look for potential directors with diverse ways of thinking and a wide range of career experiences.

In typical boards, the commitment to excellence usually stops at selecting highly qualified individual directors. For superior board effectiveness, however, the devil is in the dynamics—how well the board members interact and work together.

According to a New York University study, this includes the ability to “…effectively deal with differences; generate a trusting environment; create a meaningful context for discussions, deliberations, and decision-making; handle conflict and tension effectively; and enact effective leadership and non-leadership roles within the team.”

Dr. Thomas J. Saporito :Dr. Thomas J. Saporito (tsaporito@rhrinternational.com) is chairman and CEO of RHR International, a global firm committed to the development of top management leadership.