Insightful BoDs are able to look from a different stance, and ask different questions insightfully, deal with opposing views, cultures, constraints, and competitions holistically, in order to steer the business in the right direction.
The purpose of the governing body, or board of directors, is to direct and guide the organization in the right direction. Sound governance is part of eliminating risk and improving business effectiveness.
Organizational BoDs play a significant role in dynamic business strategy oversight: There are competitions, conflicts, and controversies all over the place in today’s complex marketing environment. As long as your strategy is not aligned with the requirements, rules and habits of your surroundings, it is in jeopardy. The corporate board of directors should take an outlier’s lens to criticize the business strategy by bringing up fresh perspectives and questioning management practices wisely. The emerging trend is highly likely to have implications for business strategy and some elements of strategy may require dynamic business capabilities. Corporate boards need business-technology- savvy strategic thinkers among their ranks, to envision emerging trends, and share fresh insight with their interdisciplinary expertise to help prioritize, scrutinize crucial business issues, in order to deal with them smoothly.
When VUCA (Volatility, Uncertainty, Complexity, and Ambiguity) is at its climax, then overly rigid management processes could prove insufficient, more sense and adaptation would be needed. The “right” strategy can’t be completely defined by the planning space; it is clarified through situational analysis and appropriate adjustment. The whole point of dynamic planning, not a static plan, is to keep iterating, learning, and working on a rhythm of sustained delivery. A tech-savvy, strategy-fluent board will have the advantage of pulling enough resources and pushing the business model of technology, trustworthiness, preparing, and launching change, innovation, and ensuring what happens next.
Organizations BoDs enhance risk management disciplines: BoDs do not manage risks but oversee risk management effectiveness, with the ability to discuss bad governance with terms such as waste, corruption, inefficiency etc. There are all sorts of risks such as planning risks, operation risks, innovation risks, expansion risks or reputation risks, etc. Effective corporate boards ensure that management has put in place an effective risk-management process, and the board directors assess whether risks are undertaken and managed consistently with the established risk appetite.
The corporate boards oversee risk management effectiveness. Some risks can be quantifiable; others can only be approximated. The corporate board’s responsibilities include taking control of the softer issues such as making policy, the strategic thinking of GRC, setting risk appetite, improving risk management effectiveness, and overall organizational maturity.
Organizational BoDs provide great feedback for business investment: There are both opportunities and risks for every investment. Corporate boards scrutinize the business potentiality and improve business investment decision effectiveness. The BoDs should wear the venture capitalist’s mindset, work closely with business executives, to make an objective assessment of their investment portfolio. Good investment approaches help businesses improve visibility into each investment, provide ongoing investment health information as well as enable understanding overall portfolio health; open up new channels of revenue and monetization within the enterprise, the industry, and their ecosystem.
The BoDs scrutinize business investment portfolios, evaluate individual and aggregate investments in terms of value, risk, and reward continually; and make sure the investment management first understands what it needs to drive future business growth and improve capital flow. The logical investment scenario helps to assess whether the business models associated with emerging trends is the right investment to be done in the first place, and ensure the expected return on investment.
Digital BoDs are the directorial role, it’s crucial to appreciate the value of alternative perspectives and insights which say nothing of not trusting, understand things and circumstances in a structural way. Insightful BoDs are able to look from a different stance, and ask different questions insightfully, deal with opposing views, cultures, constraints, and competitions holistically, in order to steer the business in the right direction, help the business achieve high performance with consistency.