To make sound decisions in a boardroom you require open discussion, strategic analysis, and technology. If done correctly, these strategies can dramatically improve a board’s decision-making capacity and lead to long-term sustainability for the organization.
The first step is gathering all information available and make sure it is authentic, complete, reliable and thorough. This is the management’s responsibility, and it involves gathering data from both internal and external sources. It also involves conducting research and making sure that the board is provided with timely, comprehensive information.
Once the data is gathered, the next step is to find the potential solutions to the problem. This is often a time-consuming process, particularly when trying to reach a consensus. Some boards employ techniques such as the Six Thinking Hats or Disney Planning Method to avoid groupthink and to allow a full range of alternatives to be considered.
The board then has to decide which option to explore. This typically involves a range of factors that include cost and impact. Scope can be measured in terms of dollars, years or the number of people impacted (e.g., clients or staff). It is useful to have a matrix which ties these criteria with the board’s general principles of governance for the organization.
Once the decision is made, the board must clearly declare it in the minutes and describe how it was made. The document should include a rationale for the choice along with a list of possible options examined, any advice that was sought and whether or not the requirements were met.
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