Board directors are often worried about how they can engage in strategic planning without micromanaging the CEO or outsmarting their role. There has been a move away from three – to five-year time horizons and lengthy planning processes to strategic frameworks articulating organizational priorities and business plans that integrate programmatic and operational goals with financial forecasts and robust annual plans that have clear metrics and timelines.
However, a board that is focused on its oversight responsibilities needs to be involved in defining strategy, understanding the strategic initiatives that are being conducted, and recognizing that there will always be special situations that require the full attention of the Board and developing an action plan to monitor the strategy. This article will discuss ways to accomplish this while allowing the Board to be a part of strategic discussions and contribute to them.
One of the most popular pieces on our site is our post on how to facilitate a strategic planning session for your board. This discussion addresses a key issue that arises over and over again in this area: where the board should draw the line between managing strategy and managing the company. This is a crucial discussion because when the Board believes that its role is to approve any plan put before it, it could be at risk of becoming a ‘rubber stamp’ board. It is crucial to avoid this by having a direct conversation between the board and management on the strategic issues that they believe are most important. This will allow the board to help frame these issues and for management to be open to suggestions from the board which could help refine and improve the problem framing.
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