The Board Game; By Peter Waine; John Wiley pounds 18.99
The dynamics of relationships among boardroom colleagues are the running theme of this practical and sensible guide for directors, says Adrian Cadbury.
Peter Waine manages to compress a great deal of valuable advice for existing and aspiring directors in a compact and well-written book, which is a pleasure to read. He has drawn on his considerable experience to address issues that are barely covered in more formal management tomes.
The message I take away from The Board Game is the central importance of relationships in a director's world.
Waine deals with the key board relationship between the CEO and the chairman, but also the relationship between specialists and generalists, risk and caution, dreams and reality, strategy and structure, and organic growth (preferred) and acquisitions. Success in the board game depends on understanding the pattern of relationships within companies, a field in which Waine is a trustworthy guide. As he says: 'The board operates largely on relationships, which can be hard to read, easy to assume.'
His analysis of the relationship between directors and the sources of finance for their companies, whether in the City or in New York, is based on the need to understand their self-interest. He fears that boards are unduly deferential to bankers. This deference stems, he believes, from their ignorance of the workings of the Square Mile. His solution is to expose directors to the City at an earlier stage in their careers so that they can learn how it works in practice behind the facade. 'The City on the whole is not a welcomed partner but rather a cruel necessity,' he observes.
Waine finds room to cover issues relating to small and family firms, which can offer satisfying career opportunities in a world where their larger brethren are flattening their hierarchies and cutting rather than creating jobs. He also includes a down-to-earth chapter on how boards should approach expansion overseas, dealing particularly with extending their activities to the rest of the EU and the US.
In addition, Waine has written a thoughtful chapter on women in the boardroom, according the issue the importance it deserves. It has always seemed to me absurd to complain that it is hard to find the right kind of non-executive directors when the pool of talented women remains largely untapped.
He points to the new generation of women who believe that they can and should be as successful as men. They are moving up the managerial ladder and will increasingly be well-qualified contenders for seats in the boardroom. His encouraging conclusion on the glass ceiling is that it 'could and should smash sooner than most males and females think'.
I was especially interested in the opening chapter on the relationship between chairmen and their CEOs, having just written on the subject myself.
His advice that difficulties in that relationship should be recognised and confronted rather than ignored is surely helpful, as is his conclusion that there is little to be done on chemistry except to acknowledge it. The two roles are, he says, different, and although they have to be complementary if the partnership is to succeed, they largely require different skills.
While it is usually true that 'a chairman adopts a role for which he has no recognisable apprenticeship', there could be better opportunities for chairmen to exchange views and experience, along with a wider acceptance of the importance of the separate chairman's role. The ability of non-executive directors to contribute constructively to the work of a board is, after all, to a great extent in the hands of their chairman.
I fully endorse his call for boards to assess their own effectiveness as boards, and he is right in believing that they should do this for themselves rather than calling for outside help. This is surely one of the chairman's leadership tasks.
The Board Game is practical, relevant and readable. Here is a sample of Waine's one-liners: 'The director should learn to be an effective listener'; 'Mediocrity is alive and well'; and 'Power lies in odd places'. He rightly insists that we should not spend time on trains telephoning and hunched over laptops, as if we were in the office, but use it as time to think - and, I would suggest, to read this book.
- Adrian Cadbury is the former chairman of Cadbury Schweppes and author of Corporate Governance and Chairmanship: A Personal View (OUP).