I had a great board meeting today at Quova and a near perfect board meeting at Rally last week. While it’s a pleasure to be involved in both companies since they are both performing very well, the structure and tempo of each board meeting really turned me on.
I had started to notice a disconcerting rhythm to some of my board meetings. On the positive side, several of my CEOs have done a spectacular job of putting together comprehensive board packages that we’ve replicated throughout much of our portfolio. As a result, we have substantial, detailed board packages that come out around a week prior to the board meeting. This gives me plenty of time to read through the board package, ask specific questions of the CEO in advance of the board meeting, and study the financials carefully. Since most of my companies are working off the same board package template, the information is predictably organized, easy to follow, and comprehensive.
However, I’ve noticed recently that a lot of the time being spent in the board meeting was being squandered by effectively reading through the board package in real time. This is often disguised as “functional updates” where each VP goes through his part of the business by simply rehashing the information in the board book. Given that the typical board meeting is three hours, I started to notice that most of the meeting was being spent reviewing the board book (which I’d already read and gotten 90% of the information from) and a minority of the time was being spent on non-operational (e.g. strategic) discussion.
I’d subtly made this comment to several of my CEOs (as subtle as I’m capable of being – visualize a bull in a china shop) during board meetings in Q4 where I realized that while it was exciting to rehash what was essentially solid performance for 2004, I was much more interested in spending time looking forward and talking about what we needed to do to drive asymmetric business value in 2005.
Rally’s board meeting last week nailed it. The board package came out five days prior to the meeting so everyone had plenty of time to read it. We had a typical three hour board meeting that started on time. The meeting then occurred as follows:
- 5 minutes: Administrative items (approve the minutes, approve new options).
- 55 minutes: Department updates. We used the board package as the guide, but each exec spent a few minutes summarizing key points (rather than reading from the package) and then we drilled into Q&A and discussion on each area. It was a spirited discussion that was forward looking (e.g. “what are we doing in the next 30 days about issue X”) rather than backward looking (e.g. “good job on doing Y last month.”)
- 90 minutes: 2005 Strategic Priorities. We worked from a six page powerpoint presentation (that had crappy production value, but was high content value) and spent 80% of our time on one slide. The entire leadership team participated in the discussion – it wasn’t a “presentation of a conclusion” but a “discussion about what to do given limited resources and divergent opportunities.”
- 30 minutes: Executive Session (Board Only). We talked about a handful of personnel related issues, summarized the discussion, and set the tone for Q105.
I left the meeting feeling both excited by where Rally is at, delighted by the dynamic among the members of the leadership team, and satisfied with the direction the board gave the leadership team.
Today, I had a very similar board meeting at Quova. While we covered very different topics – especially since we celebrated Quova’s five year anniversary today (with a fun event at the San Francisco Museum of Craft + Design) – the preparation was equivalent, the tempo was similar, and the I walked out of the meeting equally excited about where Quova is and how the leadership team is interacting with each other.
The CEOs of Rally and Quova reminded me how a well-executed board meeting early in the year is a great way to set the tone for the business for the year to come.