Making Your Board Effective – Greg’s Healthy Franchise Relationships 2-Minute Tip

This seemed like a particularly valuable and tactical tip from Greg, so I wanted to pass it on…

“Yesterday at Natadola Beach in Fiji I ticked an item off my bucket list. I wobbled my way to shore riding a wave. Yes it was on one of those longboards from the ’60s and it was my twelfth attempt. But I did it and it felt great. Last night as I walked along that beautiful beach, reflecting on my surfing prowess, I had a phone call from a colleague who was having a very different board experience. The Board of an organisation he was involved with had been disbanded in a dysfunctional mess. He was enquiring if I knew anyone who could help. I did indeed.

Louise Broekman is a small framed, big hearted business dynamo who has founded the Advisory Board Centre. She also Chairs our Advisory Board at FRI and knows a lot about what works and what doesn’t, based on years of research and experience. Sitting on the beach this morning watching the local board riders do their thing, and reflecting on last night’s call, inspired me to phone Louise and ask her some questions about how to ensure Boards function effectively. She generously rattled off a number of tips which I have summarised below. If your organisation has a Board, or is thinking of starting one, you’re sure to find these useful. Some are also relevant to Franchise Advisory Councils.

6 Tips to Improve Your Board Skills

1. Be clear on the difference between a Board of Directors and an Advisory Board. The purpose of the former is for the Directors to make strategic decisions which are executed by the CEO (and for which they are responsible), whereas the purpose of the latter is for members to provide advice to the CEO. For this reason Louise advises members of Advisory Boards not to call themselves Directors, as this could make them liable for decisions for which they are not responsible.
2. Have a code of conduct to guide how discussions will be held. Louise believes respect for the CEO’s role is particularly vital. For instance she often hears members of Advisory Boards saying to a CEO “What you should do is…” While this may be well intentioned, she says it undermines the CEO’s authority and creates unhelpful noise in meetings. Respectful listening in meetings is essential, rather than Board members coming with predetermined opinions.
3. The relationship between a CEO and chairperson is particularly important. Louise recommends the chairperson has regular discussions with the CEO between meetings to provide moral support, refine agenda items and agree on the best process to address issues on the agenda.
4. A good agenda should define the purpose of each discussion item. For instance are you wanting Board members to provide feedback on a proposal, explore alternative solutions to a difficult problem, or reach consensus on an important strategic decision? Louise says a lot of Board dysfunction comes from confusion over how agenda items are being addressed.
5. Separate discussions that involve exploring information from discussions that are aimed at reaching conclusions. Louise says Board members need to prepare well for meetings and not jump too quickly into decision-making before considering all facts and options.
6. Maintain a clear line of sight into the health of the culture. Unlike poor financial performance, cultural problems can be filtered by a CEO. In a franchise network this may involve significant franchisee unrest. Louise says having metrics on franchisee satisfaction from third party surveys is important for Non-Executive Directors as they will ultimately be held responsible if systemic conflict or litigation damages the brand.

Franchise networks need good governance to protect the interests of all stakeholders, and a Board or Advisory Board is a great investment, providing it is structured effectively. For more information about Advisory Boards I suggest you check out Louise’s Advisory Board website. And if you want to objectively measure the health of your franchise culture, our ACE Franchisee Satisfaction Survey will provide you with the benchmarks and metrics you need for peace of mind.”

Thanks Greg and Louise for your helpful insight.

If you would like to order any of Greg’s books on franchise relationships for yourself or franchise team, contact SPEAK! and let us know what you’d like.