Three Kinds of Failed Boards: Warnings for Founders from Build

Have you assembled an effective board of directors? Boards can fail in countless ways, but the failures can be grouped into three categories. 1. The indifferent board. An indifferent board emerges when most members act as though the company's problems are not their concern. Sometimes they see obvious problems with the CEO but do not try to solve them. Solving them means dealing with a mountain of work: preparing paperwork, managing emotional upheaval, finding a successor, conducting interviews, handling difficult issues, making an internal transition, then dealing with the media and a cultural crisis. So they say, “It is not that bad, right?” Because no one wants to step forward, everyone puts up with the status quo. 2. The dictatorial board. The opposite of an indifferent board, a dictatorial board intervenes and controls too much. It holds the reins so tightly that the CEO has no freedom to lead independently. Often it includes one founder, or two or three, who still wants to control the company. The CEO therefore ends up behaving more like a chief operating officer: taking orders and meeting demands. They keep the train running but have little say in its direction. 3. The inexperienced board. This consists of people who do not understand the business. They do not know what a good board or CEO should look like, cannot ask the CEO incisive questions, and are even less able to help solve problems. Such boards are often too timid to act decisively. Investors fear that challenging the CEO will cost them the opportunity to invest in the next round, or that a reputation for firing founders will make startups unwilling to work with them. Companies overseen by inexperienced boards are typically chronically short of cash. They never meet quarterly targets and always blame the market rather than the CEO or themselves. They do not know how to bring in new talent and expertise. They only nod along, eventually leading the business to collapse. In fact, even an imperfect board—too forceful, not forceful enough, or prone to bad decisions—is an essential part of any company's infrastructure. Companies need boards. ---- You need a good board. Even the world's most remarkable CEO needs a board. What the CEO needs is not the meeting itself, but advice from intelligent, committed, experienced people. Even a large internal project should have a small board of engaged executives who guide the project leader and actively intervene when things go wrong. Even the best CEO cannot simply act unilaterally, reject criticism or challenge, and answer to no one. Everyone needs someone to report to, even if that is just a two-person board meeting for an hour every few months. You will always need some kind of pressure-release valve. You will always need someone to disagree and say so directly. If you get this right, you will never become a victim of your board. Instead, as CEO, you can shape it. Boards always change with the CEO. The board under Steve Jobs was very different from the board under Tim Cook. A board can further enhance a CEO's strengths, and no two CEOs are exactly alike. #創造用非傳統方式做有價值的事 — Build: An Unorthodox Guide to Making Things Worth Making ----- My advice: “Find experts who can advise you and serve as directors. Proactively ask them questions so that you have suitable guidance at different stages.”