Motley Crew Or Marvelously Capable
HP recently announced a change in their board of directors as four people stepped down, and five new directors were appointed. These changes are considered significant in the wake of the scandal surrounding their former CEO, who left last year as a result of violations of their policies linked to an inappropriate relationship with a contractor. That was followed by the appointment last fall of a new non executive chairman, and a CEO.
Concerns about this newly appointed board as expressed by a variety of writers include some business relationships these new directors have with the CEO since several of them sit on various other boards together. More directly, Therese Poletti’s article in MarketWatch.com, HP’s New Board a Motley Crew on January 25, voices the concerns of some analysts and experts that the board “has become a haven for failed executives”, and identifies several new directors who exited their previous companies under not so positive circumstances. This, along with other aspects of HP’s future plans, could cause concern for HP's investors if they’re not confident in the ability of the new board to lead the company to a successful future.
When we look at the leaders of companies where we’re investing our money, we typically want people with proven successful track records in the arena we’re focusing on. We want to minimize risks and optimize our future gain, and we don’t necessarily have the same view or perspectives as those who selected the leaders. We’re typically looking “in” or “up”, whereas those making the selection decisions are looking “down”. The position from which one is viewing is important here. Looking “in” implies that we’re on the outside, lacking complete information on the organization’s business and financial strategy and capabilities. Looking “up” suggests that while we may be on the inside, we’re not privy to all the information regarding the key criteria and experiences these leaders should possess. Finally, looking “down” means that we do have more knowledge and wisdom on the business needs and capabilities of who can fill them. So is the new H-P board really a “motley crew”, or are they “marvelously capable”?
I’m reminded of another group of men who were hand selected and appointed as the leadership team for a service organization. They had no prior experience in the work they were asked to perform. They had the greatest respect for their leader, but for a while they didn’t really understand who he was or what he was doing. Though he spent a lot of time teaching them, they didn’t always understand his style of communication. They didn’t have the stamina that he exhibited. Though he expected them to do so, they couldn’t always replicate the things he did. Finally, one of their own leaked information that led to their leader’s capture and assassination, and they momentarily dispersed in fear. Some would have thought this was the end of that organization, but miraculously they rallied and came together again, stronger for their trials, and met to determine their next steps. After practicing and repeating all they had learned from their leader, they suddenly got it, and understood what he had been saying.Continued on the next page