When a board of directors makes the decision, it must ensure that the decision is backed by evidence that supports the goals of the company in the long-term. That means gathering information from a variety of sources, including industry reports, employee what is a strategy surveys as well as competitor analysis and other data points that help support the decision. It also involves weighing different alternatives against one another and determining which is the most likely to produce the desired outcomes.
To make this happen, Board members should consider how a proposed course of action is in line with the mission and vision of the business while also considering any legal or regulatory requirements that might be in play. In addition, Board members should be aware of any risks associated with the decision and ensure that the board’s risk appetite is considered during the process.
It is also beneficial for boards to use strategies that prevent groupthink, like brainstorming, Six Thinking Hats, Disney Planning Method and Delphi Technique. It’s helpful to assign informal roles to specific Board members, like “devil’s advocate” and “devil’s advocate” to challenge other members in their ideas and to help come up with several solutions.
Boards may also come up with a policy on what and when they would like to be informed of decisions which are slated to vote. This allows them the time to review and discuss the information before voting. They can also ask questions and develop alternatives. This helps reduce the amount of fatigue that boards experience. I’ve seen instances where boards were provided with urgent information right before they were required to vote, which could cause disruption and delay in the decision-making process.
