'The Thing That Keeps Me Up at Night'

On Aug. 16 two accounting firms, Eisner LLP and Amper, Politziner & Mattia LLP, announced that they are combining. The new firm, EisnerAmper, will create what Crain's New York called "a regional powerhouse": the 10th largest auditor of SEC-registered firms in the U.S. and the 14th largest overall in the nation.

Both firms have contributed their expertise in writing on governance and financial issues for Directors & Boards, so we certainly wish them well in their joining forces and extending their reach and capabilities to benefit present and future clients.

I am particularly grateful to a past Eisner partner, Bruce Strzelczyk (pictured). Bruce founded and co-chaired its technology/Internet/new media division. In 2002 he invited me to sit in on a workshop he organized for an audience of venture-backed company executives that was tackling how to run an effective board meeting. He assembled a marvelously talented panel to talk through the issues, and afterward he and I worked together to adapt that panel discussion into a superb article for Directors & Boards, titled "Ground Rules for Great Board Meetings."

Here is how Bruce set up the context for the gathering, which attracted an overflow crowd in a conference room at New York's Palace Hotel:

"Let me start off by telling you how this panel discussion was organized. I was at a board meeting with one of our portfolio companies. At the end of the meeting one of the VCs got up and said, 'This meeting was horrible. Let's fire the CEO.' All hands went up, and he was gone. It was an experience I will never forget. Nor will he!

"An incorrectly run board meeting can be a painful experience. It takes up more time for management, more time for the VCs, more time for everybody. For a company that is having problems, especially if it involves CEO performance, a badly run meeting is often the straw that breaks the camel's back. Or, when done well and everybody's expectations are met, it is much more efficient and much more effective."

And then we were off . . . on a discussion that ran a couple of hours, and resulted in 11 pages of solid tips and tactics in Directors & Boards.

Bruce mostly served as the panel moderator, but he did chime in with the occasional gem of wisdom of his own. I will always remember him for telling the crowd this:

""The best board meeting that I have ever attended was conducted by the CEO of one of our clients. He starts out the meeting this way: 'This is the thing that keeps me up at night . . . this is what I'm thinking about . . . and this is what I want you to help me on.' He gets a great response to that. He's now on his third company — the previous two were each sold profitably. My experience is that a board meeting's style, format, and matters covered are all reflections of what a good CEO is thinking about and concerned about."

A sad coda: Bruce died in 2005, way too early in life for someone who, again citing Crain's New York, was selected as one of the "100 leaders who will shape New York's technology industry." Thankfully he helped shape for Eisner clients and Directors & Boards readers some superb thought leadership on running an effective board meeting — one that won't cause a board to fire the CEO!

What You Say

Be mindful of what you say — inside or outside of a board meeting.

It is a learning point from Walter Green, former chairman and CEO of Harrison Conference Services, a leading conference center management company. He has written a book, "This Is the Moment" (Hay House), that will be coming out this fall in which he describes a fascinating personal undertaking. Over the course of a year he went on the road to reconnect with 44 people who played an important role in his life — at which time he expressed to them his gratitude for how they shaped the person he became.

It was striking to him to realize that, often unaware at the moment, he did his own fair share of shaping.

Green writes: "We all do some things in life automatically, and that doesn't diminish the value of them. As my friend Stephen Kaufman, a senior lecturer at Harvard Business School (and one of my 44), told me, 'Many times we fail to realize that simple, off-the-cuff comments or reactions that don't really register with us can touch important nerves or strike chords in others. My students and former colleagues often drop me notes referring to something I did or said five or ten years ago as having had a deep impact on them, yet at the time they just seemed to me like ordinary conversations with no particular import.' "

Green's important conclusion: "To be reminded of the variety of ways in which we impact people — no matter what our condition or position or locale — left an indelible impression on me. Being made aware of the value to others of what we do or say made me vividly conscious of how I might be more helpful in the future as well."

A sound piece of advice for modulating your formal interactions — and perhaps even more consequentially, those casual tossed-off comments — with your management team and fellow board members.

Gillette Moment

I get my best ideas when I am shaving in the morning. I call them Gillette Moments. My staff colleagues know these well — often the first email they get in the morning is from me sharing my Gillette Moment of the day.

I just read about a variation of a Gillette Moment in the Wall Street Journal's obituary of John Shepherd-Barron, who died last month. He is credited with originating the first automated teller machine in 1967 in the U.K. Inspiration for this new kind of vending machine came to him in a "eureka moment while stewing in the bath."

Another variation of a Gillette Moment figured prominently in an article that Vincent L. Gregory, a former chairman and CEO of Rohm & Haas Co., wrote for Directors & Boards in 1985. Titled "The Chief Executive's Role in Research and Development," Gregory (who led the chemicals company from 1970 to 1988 when he retired) offered up an agenda of helpful ways that CEOs can improve the effectiveness of their research people and operations. Here is how he began his advisory:

"Shortly after I joined Rohm & Haas Co. in 1949, I had the privilege of working at one of our manufacturing plants, which included on the same site a substantial research unit. During my orientation at the plant, I overheard the production manager complaining about the scientists who struggled into work at all hours of the morning. The thing that particularly bugged him was that some of them even shaved on company time.

"Rather innocently I asked, 'Do they ever make any inventions?' He said, 'Oh yes! Our scientists are some of the best in the world. They make a lot of inventions, and some good ones, too.'

"So I said, 'Well, what difference does it make where they shave, as long as they make good inventions?' In retrospect, I think that's probably one of the most profound statements I've made in my years at Rohm & Haas."

You gotta love that. A self-effacing comment for sure, but who knows how many consequential ideas may have come from these shaving sessions in the Rohm & Haas facility.

Now, what's your setting for having a Gillette Moment?

I often think how much more productive board meetings might be if directors headed into the day's round of deliberations having had a Gillette Moment that morning that they could bring to the table.

On Turning Your Fellow Directors' Heads

In my blog post of October 30th below, I offered an excellent tactic, courtesy of Kent Thiry, on getting the best from your directors in a board meeting. Kent's tactic was one that the board chair might employ.

Here are three tactics that directors might employ to make their contribution to a board meeting more impactful. They are offered by Scott Ginsberg, a media and image adviser who has written several books on communications effectiveness:

• Bite Your Tongue: Don't say anything until the last five minutes of the meeting. That way you can collect your thoughts, clarify your position and speak confidently. By looking around, listening and learning first, your comment will contain its maximum amount of brilliance.

• Come Out of Nowhere: When the meeting leader says, "Does anybody have any questions?" or "Any final thoughts before we finish?" you raise your hand and say, "I had an observation..." All the people in the room will turn their heads, rotate their chairs and look in the direction of the one person who hasn't said anything all morning — you.

• Articulate Your Ideas: This is the best part. See, if you only say one thing, it becomes more profound because scarcity creates a perception of value. What's more, the longer you wait to say something, the more everybody else will want to know what you're thinking. Ultimately, your calmness, patience and quietude will draw them in.

Ginsberg's tactics may not be right for every director or for the dynamics of every board. But one or two, or all three, may work well for you and your participation on certain of your boards.

I can't help but think that directors using some combination of the above three tactics along with the chairman employing Kent Thiry's "airtime metric" described below would result in one heck of a productive board session.

The Airtime Metric

Want a terrific idea for getting the most out of your board members? Especially the more quiet ones, who you know have important insights and counsel but may be reticent to speak up?

Here is a tactic employed by Kent Thiry, chairman and CEO of DaVita Inc., an NYSE company that is the largest independent provider of dialysis services in the U.S. He calls it "one of the simplest and most self-evident ideas you could imagine." This is from his article, "Powerful Tactics to Power Up Your Board," published earlier this year in Directors & Boards:

"Every single board I have sat on had a subset of the members who did most of the talking. Furthermore, on many issues, a couple directors would do most of the talking, someone would venture forth with a conclusion, some heads would nod (or at least not object), and the discussion would move on.

"Therefore, I began the following practice: A couple of times at a board meeting, after there has been some give and take on an important issue, I will ask for us to go around the room and have every director speak, and sometimes each executive as well — even if it seems like there is a directional consensus.

"The consistent result is that we get some of the most insightful comments of the entire meeting.

"These are comments that would otherwise have never been made, because people did not want to fight for airtime, or they were worried it would prolong the conversation forever, or because while it was a value-added comment it would not directionally challenge the answer — all sensible reasons to hold back from throwing in another comment.

"But for an important topic, these synthetic closing thoughts, provoked by the extensive conversation that preceded them, are often the most valuable. Since each director knows they will get their turn, there is no need to rush — quite the contrary, they know the whole point is to reflect on the entirety of the issue.

"Some will link our discussion to other big issues, some will tie it to history, some will point out organizational issues it raises, some will point to capital market or implementation issues, while others point out optical issues.

"Whatever it may be, the aggregate result is every director becomes engaged by providing thoughtful closing comments on an important issue, with the rest of the board as their undivided audience."

Give it a try at your next board meeting. You might be astonished at the results when you employ this airtime metric. As Thiry admitted, "I only wish someone had brought it up to me years earlier, as I have been struck by its power."

Wild Blackberrys in the Boardroom

I don't allow any kind of cellphone use in my classes. Students don't make phone calls, but it's the texting and message checking that drive me nuts, and that's what is verboten. When I'm in front of the class, I'm the chairman of the board calling the meeting to order. Full attention and engagement is required.

I do share with the class the experience I had attending a directors' conference at a leading university in New York City. I had a seat in the back of the room. There was a high-powered panel on stage — standout board leaders addressing substantive matters. But as I looked around the room from my sweeping vantage point in the back, all I saw were accomplished executives hunched over their Blackberrys scrolling away and texting furiously. So much for attention being paid to the governance thought leadership being conveyed on stage. A shameful sight, I thought at the time — and still think so. My students get the message.

From anecdotal tales of how widespread Blackberry use is during board meetings, I fail to understand how board chairmen tolerate it. Not every chairman does. I was glad to hear that there is at least one chairman who doesn't allow cellphones in the board meeting. In an interview I did with Rick Goings (pictured), chairman and CEO of Tupperware Corp., for the cover story of the Q2 2009 issue of Directors & Boards, he told me this about his board practices: "No Blackberrys during a board meeting. I've sat in on some board meetings at other companies and everybody is on their Blackberrys. Our board members don't do that." Good for him for having such a policy.

And now comes the Financial Times story, "Why Email Must Disappear from the Boardroom." It makes a persuasive case for banning Blackberrys in the board meeting. Among its pointers:

• "Attention is a scarce resource. Indeed, some management thinkers have described it as the scarcest resource in most organizations. Splitting attention between two tasks is something people simply do not do well."

• "When a corporate director starts replying to an email, which task is receiving attention: the message or the meeting? The most plausible answer is the message, which means that the director who is working on his email is dedicating scarce resources to something other than that for which shareholders are paying. If your lawyer billed you for time spent working on someone else's project, it would be considered negligent at best."

• "In our experience, we are witnessing more and more situations in which board members are expressing outrage at some of their colleagues' inappropriate use of their wireless devices. ... In the light of such complaints, the preponderance of scientific evidence, the fiduciary responsibilities of directors and the obvious conflicts between reasonable duties of care and multitasking, we offer this modest proposal to improve the state of corporate governance worldwide: all board should disclose that they have a 'no wireless device' policy during meetings."

Failure to put in such a policy, concludes the FT critique, "should result in lost support for the board and its individual members." And, by extension, it should result in greater support for board chairmen like Rick Goings who have a policy of demanding full attention and engagement from their board colleagues.