The article cites instances from NASA (HST), Volkswagen and Wirecard to illustrate how boards may miss early warning signs that can lead to danger. The article stresses the importance of identifying early warning signs and acting on the warning signs. This can be achieved through an organized review process for boards, which helps them assess their effectiveness and performance.
The authors emphasize the importance of boards reviewing their own performance and the performance of the other organisation to find areas for improvement. In addition, they emphasize the importance of leveraging the expertise of outside consultants to ensure that the agenda of the board is complete.
A board room review is an assessment of the effectiveness of the board of directors as compared to the ideal demands for the business. It can be an internal evaluation using a top benchmarked instrument such as those used by Board Surveys, or a unique external evaluation customized to the needs and requirements of the organisation.
It is vital that the board room is a space where members are able to speak freely and honestly. They should be able to concentrate on the task at hand without being distracted or interrupted, and they must feel comfortable discussing sensitive topics. A conference room equipped with large trestle tables as well as chairs, a soundproofing environment that keeps conversations private, and modern technology such as Bloomberg plug-ins or state-of-the-art quotation systems can be helpful. A virtual meeting room allows participants to participate in meetings at their offices, at home or even on an airplane. This makes the process more convenient.
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