When a board of directors makes a decision, it must ensure that the decision is supported by evidence that supports the goals of the company in the long term. This means gathering data from a range of sources, including survey results, industry reports as well as competitor analysis and other information points that support the decision. It also involves weighing several options against one another and determining which one is most likely to yield the desired outcomes.
To make this happen, Board members should consider the extent to which a proposed plan of action aligns with the mission and vision of the business as well as any legal or regulatory requirements that might be a part of the decision. Additionally, Board members should be aware of the potential risks associated with the decision and make sure the board’s risk tolerance is considered in the process.
Boards can also benefit from techniques that are designed to avoid groupthink. This includes brainstorming, Six Thinking Hats (a method to avoid groupthink), Disney Planning Method, and Delphi Technique. It can be helpful to assign informal roles to certain Board members, such as “devil’s advocate” and “devil’s advocate” to challenge other members for their ideas and assist in generating various solutions.
Boards also have the option of deciding how and when to notify members of forthcoming votes. This allows them to have the time they need to examine and discuss the information prior to voting, as well as it allows them to ask questions and consider other options. This also helps reduce the fatigue of board members. In the past, I have been party to situations where urgent information was provided to boards right before they are expected to vote on it, which can hinder the decision-making process and derail the outcome.
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