Setting the Foundation: Building a Strong Board-CEO Partnership
Establishing a positive connection between the board and the CEO is never more important than when onboarding a new chief executive officer. Actions taken during the first few weeks and months of a new CEO’s tenure will establish the groundwork for a successful ongoing relationship. Here are some tips for getting off to a fast start.
- Provide feedback regarding the hiring process: Both the selection criteria and job description for the CEO position should be discussed directly with the new CEO. Framed correctly, feedback about the CEO’s fit with those role requirements can help level-set expectations and get the relationship off to a good start. Without those guideposts, a new CEO will continue to behave consistently with what they have done previously. What has worked for them before may work against them now, and ongoing feedback is critical for successful adaptation. Creating a formal development plan based on the selection assessment results represents one best practice.
- Discuss performance expectations: It will be important for both the board and the CEO to voice their expectations early in the new relationship so everyone has a clear roadmap to work from. Those expectations can cover what the key performance metrics are and how the board-CEO relationship will ideally play out. Providing the new CEO with a clear set of behavioral guidelines and goals will help them assimilate more rapidly into a new culture.
- Establish an ongoing communication cadence: As previous research from RHR International’s Board & CEO Services practice indicates, the quality of the communication between the board and the CEO is highly correlated with organizational performance. Identifying the frequency and process for communications will be important. There will be formal presentations and informal conversations that take place, and laying the groundwork for the expected frequency and length of those interactions should help provide guidance for both parties. For example, setting the expectation for the CEO to send an email to the board to recap action steps from the last board meeting and establish the agenda for the next meeting will help ensure clear communication.
- Start with questions, not with statements: Ideally, the board will be an important source of advice for the new CEO. Unsolicited advice can lead to resistance, so it is advisable for the board to initially hold back on their opinions and first respond to the CEO’s requests for counsel. As the relationship becomes solidified over time, the board members can use their own judgment about what advice is likely to be valued by the CEO. In the best-case scenario, there will be an open and fluid give-and-take about individual and organizational performance by both parties. This should be guided by the fiduciary responsibility that both the board and the CEO own.
- Invest the time needed to establish rapport: Any new CEO recognizes that their relationship with the board is fundamental to their long-term success. They will need to invest the time needed to understand the personalities involved and what their communication needs and preferences are. At the same time, the new CEO can help solidify relationships by sharing their vision for the business and asking for input on strategy. Both formal board meetings and informal dinners will help facilitate that goal. Over time, the investment in relationship development a board and CEO make will generate a foundation that promotes trust and transparency.
- Recognize that each board-CEO relationship is unique: It is natural for the board to look at a new CEO in the context of the former CEO. If the relationship was positive, the board will try to replicate that dynamic with the new leader, but if it was lacking in some way, the board will look to correct that deficit with a fresh start. Given that each board-CEO relationship is unique, it is important to give the new relationship some time to develop naturally before jumping to conclusions. Establishing a mutually beneficial relationship early on will help build lasting partnerships later on.
In summary, gaining clarity about expectations and establishing positive working relationships early in a new CEO’s tenure will lead to long-term success. Board-CEO interactions can be fragile at first, but if the foundation is solid, the alliance will be able to withstand the turbulence that is part of every new journey. Investing the time and energy needed to get off to a good start will pay dividends in the future.