In this final part of our 3 part series on startup boards, we ask and answer 2 questions 1) How do CEOs annoy Directors? 2) How often do Board reviews happen?
This chart is quite interesting. Majority of directors don’t seem to be in the loop as issues develop and feel they could have made an impact had they known earlier. Our suggestion is that CEOs find many opportunities to cultivate a close working relationship with their directors, so sharing bad news can happen naturally. Having a consistent and frequent communication with the board is really critical and will come of immense use when help is needed, such as signing on a customer or help with the next fund raising round. As CEOs, never discount the power of communication.
Another aspect that we probed into was regarding reviews of boards – by CEOs and by other board members. Members of the Board have typically not worked with each other before and it is not natural to formally review others in such relationships.
CEOs responded to this question as to how often they review value add of Board members. 14% have never done it. 41% have done it once or twice. 41% have done it occasionally and 5% have done it regularly. We recommend that CEOs do this review consistently and often.
When directors were asked if they ever felt that a fellow board member needed to be removed, over 50% said they have felt once or twice about doing so and 18% believe that there is always someone with the wrong fit. Having peer evaluation of board members would go a long way in a cohesive board ensuring the maximum value for the startup.
It has been a pleasure to bring this information to you and we reiterate our gratitude to over 112 participants that took the survey.