When a board of directors makes a decision, it must ensure that the decision is backed by evidence and is in line with the goals of the company in the long haul. This means obtaining information from various sources, including industry reports, employee surveys and competitor analysis to back up the decision. It is also important to weigh different alternatives and determine which is most likely achieve the desired result.
Board members must be aware of the alignment of the proposed course with the company’s mission and vision as well as any legal or regulatory requirements. Board members should be aware of the risks that may be associated with a decision, and ensure the board’s appetite for risk is taken into consideration.
It’s also beneficial for boards to implement strategies that prevent groupthink, such as brainstorming, Six Thinking Hats, Disney Planning Method and Delphi Technique. It can also be beneficial to assign informal roles to specific Board members, such as “devil’s advocate” to challenge the ideas of others and help generate a range of solutions.
Boards can also develop policies on the manner and time they wish to be informed of decisions which are due to vote. This lets them have https://boardmeetingtool.net/financing-mergers-a-guide-to-modern-methods/ the time they need to consider and discuss the information prior to voting, and it allows them to ask questions and think of other options. This helps reduce the stress of board members. I have witnessed situations where boards were provided with urgent information prior to when they were expected to vote, which could delay and disrupt the decision-making process.
