Boards That Work

Naomi Kent President of In Touch Networks North America ( and Bill Adams Chairman/CEO of Targatek Inc. ( and author of the book “OUTFOCUS – Harness The Power of Collaboration,” team up to provide a series of articles, interviews, panel discussions and training sessions for senior executives looking to unleash the power of boards and for executives looking to join a board. Having served on 4 NASDAQ boards (chairing two of them) and now presiding over Targa’s current board of directors and board of advisors, Adams brings to bear a wealth of first-hand experience assembling and leveraging the collective ‘brainpower’ that boards have to offer. With their combined experience, Kent and Adams discuss with special guests the underlying nature of board governance in the modern era and peel back the onion of success to assemble and preside over boards that work.              

Talent-Stacking Board, Article #1, Boards That Work

Boards are a fundamental part of modern-day organizational life without which many companies would not be able to effectively operate. Boards can add a dimension to the overall health of a company that would otherwise be missing thereby helping the organization move forward. However, most people including board members themselves are unaware of the evolution of boards.    

Originally in the 16th century, a ‘board’ was known as the table around which people gathered for important meetings, but it swiftly evolved into focusing on the important people gathered around the table, rather than a piece of furniture. According to Management Today, the term ‘Board of Directors’ was first recorded in 1712 and ever since has grown in application, sophistication, and stature.   

Hence, boards are not new! But how they are formed and utilized has significantly morphed over the centuries especially since the industrial revolution. During the post-World War II era, boards began to take on a new life-form, gaining prominence and notoriety in large companies from every industry (e.g., IBM, General Motors, Johnson & Johnson, Proctor & Gamble) where sitting on a board was not only a privilege, but a way to open the door to opportunity for both the company and board members.    

In the modern era, many leading research and consulting firms (e.g., Deloitte, PwC, and McKinsey) spend enormous resources every year to better understand the underlying dynamics occurring in the boardroom as the age of collaboration unfolds. One common conclusion: corporate governance the primary role of a board, has become not only more complex, but more critical to the long-term success and security of a company than ever before. 

The picture researchers paint for those companies that do not build and maintain strong boards is anything but pretty – it’s downright ugly! Overwhelmingly, these studies suggest that boards are expected to be more involved in setting the tone to move an organization forward that goes far beyond the traditional governance aspect of board responsibilities. 

Building and maintaining a board that contributes value to the business may be the most important asset a company can possess. In fact, how executives of companies attract the right talent to the board and then leverage that talent to move the organization forward is as much a science as it is an artform.  

This goes for startups and early-stage companies looking to build boards as well as established companies looking to improve the contribution of boards. To effectively accomplish this end requires a well-vetted approach that enables executives to attract the right combination of ‘brainpower’ to the board and to ensure that board members ‘work in concert’ to drive the future of the business, while governing the existing business. 

After extensive experience serving on and chairing NASDAQ boards and acting as interim CEO in many NASDAQ companies that have boards, I had a bird’s eye view to observe how good and bad boards operate.  Armed with this experience, I established the 3Ps for selecting board members – pedigree, persona, and participation – since building a solid board begins with selecting the right talent. 

This is the first in a series of articles. It delves into the interview and selection process, where it all begins. How executives amass the brainpower to take a company into the future is without question the most critical step in building the board of tomorrow. So, let’s see how the 3Ps factor into building a board that works.        


The composition of a board from a pedigree perspective is undeniably the most critical aspect of board building. Pedigree for our purpose means the lineage of education, work experience and previous contribution that a candidate has made to the success of prior organizations. 

The origin of today’s use of the word goes back to ancient Greece. The pedigree of board members represents not only their ability to bring intelligence and experience to the table (where the word “board” began), but it is also an indication of how well they will fit together and add to the brainpower of a board. 

Assembling a high-performance board requires diversity. I’m not speaking about the ethnic aspect, although that should be factored into the equation, but more so the diversity in education, experience, and the types of success candidates have had over their careers.

Homogenizing a board with similar pedigrees is not the mark of a healthy board. In fact, doing so can lead to a limited perspective of how the business should be governed and moved forward.  In most cases, the lack of diversity in pedigree leads to a single-minded approach to the business which can and usually does cause a chasm between the executive team and the board. 


Case in point – Manufacturing Software Company

This privately held technology company boasting $60m in sales had a long track record of success that many Wall Street investment firms (e.g., Goldman Sachs, Merrill Lynch, Bear Sterns) wanted to capitalize on. They acquired the firm with an eye on packaging up the company to sell.  They had been at it for over three years with no success before my firm was brought in to help get the job done. 

The board was peppered with nothing but Wall Streeters with little or no operating experience. The CEO, a turn-around specialist, often lamented to me that the board was of little help in running the company or moving the organization forward except to apply pressure on the executive team to sell the company. Eventually the business model was transformed, and the company was sold.


This is an example of how homogenizing a board can work against all efforts on the part of executives to govern the business and to move the organization forward. This board was almost no help in this regard. The total lack of diversity – money managers only in this case – created a chasm between the executive team and the board that never resolved itself to the day the company was sold.   

The evidence is clear, diversity of pedigree on the board matters and what matters most is how an executive team stitches together a board through diversity of education, experience, and success stories. Carefully bringing together the right mix of talent on a board should be the primary goal of an executive team and no executive team charged with assembling a board is exempt from doing so – bar none!    

Moreover, boards are the foundation upon which the culture of an organization is formed, regardless of industry or size. Viewing the board as a living, breathing entity within the organization that is nourished by diversity and driven by diverse points of view will go a long way towards ensuring the board is not myopic by nature. Do this well to build a board that works.


The second and perhaps most difficult thing to judge in the interview process is the persona of a candidate. During the interview process, it can be extremely difficult, if not impossible, to emphatically determine a candidate’s true persona while under pressure when it really counts. 

The persona is overarching. It includes the personality, character, and image of an individual that can be difficult to judge – but judge it we must! This is where the rubber meets the road when assembling a board and the artform of judging these three critical qualities within a candidate becomes extremely important. 

Stitching together a board requires that the individual persona of board members meld together well while holding dear their diverse opinions on how to govern and move the organization forward. Stray on this one and watch how quickly the board can fragment and form individual fiefdoms that can result in executives losing control.  

Case in point – NASDAQ Technology Company

Sad as it may be, this old-guard technology installation company unraveled due to the inability of its board to come together and meld their diverse opinions. As a member of the board, I watched as a small splinter group of the board forced out the existing CEO and replaced him with an outsider of their choosing.

The new CEO had his own agenda that closely aligned to the splinter group that brought him in. The result was not pretty. The company revenues spiraled downward over 45% in one year and the company was delisted from NASDAQ as its stock price dropped below $1.00 (the minimum to remain listed).    

The group that undermined the CEO was on the board solely as investors, and this can be a major problem as the money of an individual often wins over the persona of an individual. There is no substitute for money when a company needs it, so the persona of the individual often takes a back seat.

After ousting the CEO for attempting to do an insider buyout deal, I assumed the Chairman/CEO position to right the ship, but it was too late. The company had strayed due to the greed of a rogue group of board members, and it was eventually sold off. 


Executives, listen up. This can happen to you if you are not judicious in selecting individuals that possess the right persona to fit with other board members. Think of it this way. Stitching together a board is a bit like putting together a rowing team with you as the cockswain.

You call the direction and tempo of the business, but if the board around you are not willing or able to row together with you then trouble looms large. Do everything you can to ensure that the personality, character, and image that a potential candidate exhibits are right for the team. Dig deep, don’t be afraid to get in their heads. Present scenarios that are provocative and provoke a response to see how they react. 

As indicated earlier, this is the artform of stitching together a board. Always assume you are getting the best in an interview and then expect some level of slippage as the challenges of governing the business and helping to forge its future unveils the true nature of an individual. Do this well to build a board that works. 


Third, but by no means the least of the 3Ps, is the level of participation that a potential candidate is willing and able to give. A warm body with money is just that. Then there is the worry about the pedigree and persona they bring to the table. Albeit investing is a major part of keeping a board member’s interest intact, but it’s often not enough.

Rounding out the interview process with the topic of participation only makes sense. In fact, it may be the deciding factor between candidates, as I have experienced. To be on a board and receive the rights and privileges offered a member there must be some quid-pro-quo back to the organization in the form of time. 

When interviewing a candidate, be clear as to what is expected of them. There is a vast difference between being a board member in name only and making a difference as a board member through actions. The best way that I found to get board members involved is through the forming of committees. 

Larger well-established organizations, be they for profit or not-for-profit, have committees for board members to serve and chair, but startups and early-stage companies can and should do the same. Committees properly formed and run can make all the difference in how boards govern the business and move the organization forward. 


 Case in point – Consumer Healthcare Company  

This public consumer products company’s board was comprised of nine physicians and the firm’s attorney, all of whom had invested in the company. The firm had a well-known, well-liked movie actor as its spokesperson. It had built a significant reputation helping people cope with various health problems using their over-the-counter product that they had patented. 

I entered the situation when the company had fallen on hard times due to inappropriate activity on the part of its Founder/CEO. The organization was in complete disarray and the board was in a panic as to what the best course of action was to right the ship.

Serving as interim Chairman/CEO, I immediately formed four committees comprised of board members and senior officers. Each committee was chaired by a board member. Putting the board to work was the best therapy and the best use of resources that the company could have pursued. 

With the help of the committees, the firm was able to manage through a difficult period in the company’s history. Prior to forming the committees, the board was in name only. There was no direct participation on their part to govern the business and move the organization forward. This change in how the board conducted business was permanently adopted.  


I do not know how board members can reasonably participate in governing the business or lead the organization forward absent committee involvement. The very existence of committees compels candidates to commit to participating on a level that supersedes any other form of involvement in operations that I have found.    

Regardless of size or maturity of a company, I strongly recommend forming committees or strengthening existing committees by leveraging the brainpower of the board to the hilt. Remember that the pedigree and persona of the board must be mined to its fullest to keep pace with the fluid market and competitive conditions that seem to change almost daily.

Participate or parish. This is a motto that executive teams should adopt when it comes to assembling and maintaining boards. Carefully consider whether you want an active board or a passive board. One thing you can be assured of is that active boards make a difference and help    to build a board that works.       

Summary  Boards are an asset that public and private companies can’t do without, but boards need attention and require direction. As the cockswain of your crew, be sure that you are clear as to the combination of pedigree, persona, and participation you expect in the recruiting process. And always keep in mind that assembling a board is as much a science as an artform and that selecting board members for money alone may just be the worst executive decision you will ever make.