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The ability to make decisions in the boardroom requires a combination of open discussion and strategic analysis as well as the use of technology. When done well these strategies can drastically increase a board’s decision-making capacity and result in long-term sustainability of the company.
The first step is gathering all the available information and ensure that it is accurate, complete, credible and comprehensive. This is management’s responsibility and includes gathering data from internal and external sources, conducting research, and making sure that the board is receiving current, comprehensive information.
After the data is collected, the next step is to determine the potential options https://boardmeetingtool.net/what-is-a-strategy-and-why-it-is-important-for-any-field that could resolve the issue. This can be a lengthy process, especially when attempting to reach a consensus. Certain boards employ methods like the Six Thinking Hats Method or Disney Planning Method in order to avoid groupthink and promote all options to be taken into consideration.
The board has to choose which option to explore. This usually involves a variety of elements, including cost, impact and the scope. Scope can also be measured by the number of affected individuals (e.g. employees or clients). It is important to have a framework which ties these criteria with the board’s overall governing principles for the organization.
The board should explain how it came to its decision in the minutes. The document should include a rationale for the choice, a list with the alternatives that were examined, any advice that was sought and whether or not the criteria were met.
