Board directors are often concerned about how to participate in strategic planning without imposing their will on the CEO or overstepping their role. There has been a shift away from three to five year time horizons as well as long planning processes towards strategic frameworks that articulate the priorities of the organization and business plans that blend programmatic and operational goals with financial forecasts and solid annual plans that are clear in their deadlines and metrics.
A board that is focused on its oversight responsibilities has to be involved in the formulation of strategy, understanding the strategic activities taking place, knowing that there will be situations which require a significant amount of attention from the Board and devising an effective monitoring plan for the strategy. This article provides ways to accomplish all of this while allowing the Board to be a part of strategic discussions and contribute positively to them.
Our post on facilitating the board’s strategic planning session is one of the most read articles on this website. This article focuses on a topic that is raised repeatedly in this area that is how the board can determine the distinction between managing the company’s strategy as well as its own strategy. This is an important discussion because it is a matter of perception. If the Board thinks that its responsibility is to approve any plan submitted to it, it could be in danger of becoming a ‘rubber stamp’ board. It is important to avoid this by having a clear discussion between the board and management on the strategic issues that they consider to be the most important. This will enable the board to assist in framing the issues and management to be open to suggestions from the board that enhance and refine the problem-solving process.