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    Sadly, some things are just the same...26 years on

    Governance Leadership Management Performance Strategy
    We live in a fast-paced world, where the only constant seems to be change itself. Messages of the latest and greatest scheme or product or idea bombard our senses daily, imploring us forward, towards "progress". Yet in some quarters change actually occurs very slowly—at glacial speeds even—despite the best intentions of enthusiastic advocates. The corporate boardroom is one such quarter.

    I've been reading Making it Happen, Sir John Harvey-Jones' reflections on leadership. Harvey-Jones, a successful British businessman and industrialist, was perhaps best known for leadership of British firm ICI, culminating in his chairmanship from 1982 to 1987. His insights are timeless, because they continue to be relevant today, 26 years after they were first written. To illustrate the point, here is a selection of salient comments that Harvey-Jones made about boards in 1988:
    • Every member of a board shares a co-equal responsibility for the future of the company. Board members are chosen from amongst the most successful executives ... understandable tendency when you first join a board ... for everyone to assume that you will 'pick it up as you go along'.
    • Boards do not easily set themselves the sort of criteria of success that they would unhesitatingly apply to every other part of the business. Yet unless a board continuously criticises the way it is working ... it is extraordinarily difficult for it to improve its performance.
    • Many boards are quite unclear as to whether they are merely a coordinating committee, or whether their primary responsibility is to the group as a whole.
    • It is important not to go in to a meeting without some clarity in your own mind as to what you are expecting to achieve. If you go because the meeting has been called, with little personal aim, one should ask oneself why one is going at all.
    • Sadly, it is perfectly possible for boards of directors to meet regularly and never discuss any creative business at all. (Harvey-Jones describes this as a "severe abnegation" of both personal and collective responsibility.)

    Do any of these points sound familiar? They should do, because they still characterise the behaviours and attributes of many boards in 2014. Why have boards not embraced the same enthusiasm for change and improvement as has been demonstrated elsewhere in the business community? It's high-time boards took stock.
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    How is a researcher different from a consultant?

    Governance Leadership Performance Research
    Last week, I explored the difference between an advisor and a consultant. The question stimulated a strong response (thank you!), thus this encore. The difference between a researcher and a consultant might seem to be more clear cut. Most of us think of researchers as those boffins that inhabit our learning institutions, whereas consultants are typically suited and found in business environments. Does that make them completely different beasts? Consider this:
    • A researcher defines problems and tries to solve them. So does a consultant.
    • A researcher is a knowledge worker. A consultant is as well.
    • Researchers tend to work alone. Many consultants do as well.

    At this level, the roles appear to be very similar, so are the two terms simply two different names for a very similar activity? Possibly, but I don't think so. A key difference between the roles is emphasis. A consultant is most interested in practice, and good consultants use theory to contribute to their work. In contrast, a researcher is most interested in theory (be it testing theories or developing new ones), and good researchers use data from practice to inform their work (testing theories or developing new theory).

    The roles are different, but they are closely coupled. Given this, why do so many consultants look down their noses at academic researchers (and vice versa)?
  • Published on

    Governance, by looking backward

    Governance Leadership Performance Research Strategy
    The NACD's annual missive, of the burning issues likely to light up the corporate governance firmament in 2014, has just been published. The article, which claims to provide a comprehensive assessment of what's on the board director's horizon, makes interesting reading—as much for its omissions as its inclusions. Sadly, the reportedly burning issues, which were "gleaned from interviews with directors and corporate governance leaders", are historical, defensive or operational in nature.

    I have no doubt the reported issues are the ones that were on the top of director's minds when they were interviewed. They are important, and need to be dealt with. However, the omission of issues that can make a difference to company performance is very revealing. Boards are responsible for optimising company performance in accordance with the shareholder's wishes. If the published list is any indicator, few boards will spend much time actually looking ahead in 2014 to issues that matter, like strategy, boardroom performance and accountability.

    The question that drops out of this discussion is a tough one: Why do shareholders continue to appoint directors and accept boards that spend the bulk of their time looking backward?
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    Are you an Advisor or a Consultant?

    Governance Leadership Management Performance Societal Wellbeing Teaching
    Periodically, I'm asked whether I'm an advisor or a consultant. For many years now, the answer I've provided has been 'advisor', often in an effort to avoid the stigma commonly associated with 'consultant'. (Consultants are the guys that borrow your watch to tell you the time, right?) However, as I've studied the English language more closely in the last couple of years, I've become much more comfortable with the term 'consultant', because it most accurately describes who I am and what I do. Let me explain.

    Generally speaking (although perhaps somewhat simplistically):
    • A consultant is a problem-solver, a simplifier. They are someone you call on to find a way forward, when you have a problem in need of a solution. At their best, consultants provide answers, or at least recommendations. They may or may not actually do the work to implement any solution you choose to pursue.
    • An advisor is a problem-definer. They are someone you call on as an impartial sounding board, to stimulate your thinking and to test ideas. At their best, advisors help survey the horizon and bring the future into focus. They may well recommend the names of others (consultants!) to help solve a problem once it is more clearly defined.

    While my priority as a pracademic is to think broadly about corporate governance and strategy in order to discover possibilities and pursue options, my clients are most interested in solutions to problems they face today – recommendations and answers – which fits nicely with my instinct to understand and solve problems.

    Now your turn: Are you an advisor or a consultant?
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    Finally, some sensible rhetoric from local government

    Governance Leadership
    I have written about failures of governance in the local government sector several times over the last six months or so. Hubris appears to be a common thread, whereby political agendas, grandstanding and various hobby-horse schemes get in the way of sound strategic and fiscal management—to the detriment of our cities and communities. It's a bit sad really.

    You can imagine my surprise then, to read this article on the living wage proposal recently adopted by Wellington City Council. It is one of the most coherent arguments that I have heard from a serving councillor in a very long time. Amongst other points, Councillor Young admitted that the decision process amounted to a failure of governance. Well done, Nicola Young. Hopefully your colleagues will read your article, see the sense in it and reverse their recent decision – but that may require the consumption of some humble pie, and the intervention of a higher power, like the ballot box, I suspect.
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    Gosh, is this a good governance practice?

    Governance Performance Societal Wellbeing
    Several months ago, Tony Marryatt left his job as CEO of Christchurch City Council, following a falling out with Mayor Bob Parker (now Sir Bob) and others. As part his severance deal, it appears that Marryatt agreed to resign also from the board of Civic Assurance (more correctly, of the parent, Local Government Insurance Corporation Limited), the Council's insurer (yes, that sounds like a conflict of interest to me as well). 

    Marryatt did fufill his commitment to resign from the LGIC board as required. However, he was reappointed immediately. Wow, this sounds like a highly unusual decision process, to say the least. Some serious questions need to be asked. Two that spring to mind are:
    • Why did Marryatt allow his name to be considered for reappointment, when many questions hung over his reputation and recent performance? (Marryatt's unhappy departure from the CEO role was not his first.)
    • Why did the LGIC appointment panel even consider Marryatt as a candidate, let alone immediately re-appoint him?

    The matter raises many more questions as well, mostly about the quality of governance practice and decision-making at LGIC. LGIC is owned by several local councils, a sector that has endured a few failures of governance in recent times. Transparency and accountability are crucial if the confidence of the public is to be maintained. Hopefully the LGIC board will put its collective ego (and political motivations?) to one side and commission an independent evaluation, of its appointment process and its overall performance.