The Best Boards Find Strength in TensionBy: Paul C. Winum
In a recent Harvard Business Review article, three of my RHR colleagues (Orla Leonard, Nathan Wiita, and Christopher Milane) reported the results of research they have been conducting for the past six years about enterprise-wide leadership teams. “The Best Senior Teams Thrive on Disagreement” summarized their work with 99 senior management teams across a variety of industries. The teams completed surveys comprised of 110 items that addressed everything from team structure to processes, results, and dynamics. More than 700 of the executive leaders on these senior management teams also provided data about their company’s organizational performance (sales, revenue growth, new product development, and market share).
One of the big findings of this research was the high correlation between top-team performance (as measured by business outcomes) and the ability to manage conflicting tensions. Cohesion, formerly thought of as perhaps the most important attribute of a high-performing team, was not so important. The best teams strike the right balance between cohesion and constructive conflict. After reading this HBR article, I was reminded that this finding is also quite applicable to the functioning of effective boards.
This observation was made at the 2017 Stanford Directors’ College by the panelists on a session entitled “CEO and Board Psychology.” The best board directors now do more than provide oversight—they proactively challenge each other and management to navigate the inherent tensions between the pursuit of short- and longer-term results and between taking and managing risks. They also recognize the continual need to adapt to the rapid pace of change in the competitive landscape within which they operate.
As Leonard, Wiita, and Milane argue, success for teams charged with enterprise leadership now requires the ability to innovate, which depends upon challenging both the status quo and a culture that encourages high levels of trust and transparency. Great board chairs are able to convey expectations for constructive tension and facilitate candid dialogue. They construct agendas that aren’t just filled with a parade of presentations but that leave time for discussion of complex issues. And they promote a respectful, collaborative partnership between board members and management that results in continuous improvement and strategic value.
Innovation and risk-taking almost always cause friction and tension, and strong boards recognize their merit lies in embracing rather than avoiding this inherent duality. Ambitious achievement-oriented executives welcome and value that kind of challenge. It’s how boards contribute value these days.