A prime target

ENDNOTE A prime target A personal rebellion against 'think-alike' hoards motivated the founding 0/DIRECTORS & BOARDS. BY STANLEY FOSTER REED Ed. Note: Stanley Foster Reed, founder of DIRECTORS & BOARDS, died on Oct. 25, 2007, at the age of 90 (see tribute by his daughter, Alexandra Reed La- joux, on page 28.) The following article is from an essay he composed for the journal's 20th anniversary edition pub- lished in 1996. A T THE END of the 20th cen- tury, a French pharmacist- turned-hypnotist-turned-self- motivationist, Emile Coue by name, believed that people would be happier and more productive if they could get to know and like themselves. And he persuaded millions of the French dtoyens to stand in front of a mirror and repeat over and over, ''Tous les jours, a tous les points de vue, je vais de mieux en niieux." Coueism was soon exported to Amer- ica and soon millions of Americans were persuaded to gaze back at themselves in the mirror and repeat; "Every day, in every way, I am getting better and better." Good directors must know themselves and know what they are good at before they can provide good advice and ef- fective guidance to management. Both individually and as a board, they must look at themselves and ask if they really are getting better and better. The answer is often no. But why? Because good corporate governance comes from the joint efforts of direc- tors with known abilities formed into a group with complementary talents. It does not come from groups of people brought together because they enjoy each other's company. I came to this opinion back in the 76 DIRECTORS a BOARDS one board on which I served for 10 years, no one ever interrupted another board member. Never!' — Stanley Foster Reed, pictured in Charleston, S.C, in the mid-l 990s while serving as entrepreneur-in-residence at the College of Charleston. 1960s serving on the boards of a number of companies where board membership was the result of shared experience ei- ther on the golf course, in college, or in social congress. We directors all looked alike, dressed alike, talked alike, and en- joyed each other's company. And, one after another, the companies got into trouble. Serious trouble. How come? Because the boards were created for social purposes, not business purposes. They lacked diversity. They were think- alike boards. There were never argu- ments. On one board on which I served for 10 years, no one ever interrupted another board member. Never! One board was composed entirely of members of the Young President's Orga- nization. Another of engineers who had each started his own high-tech company. Another of all MBA/management con- sultants. Another of all members (except me) of the founding family. Were any of these boards a "team"? We thought we were. Were we effective? No! We were like a baseball team of all pitchers! While I didn't know then as much about management as I know now, ! knew that those boards were ineffective. So I founded DIRECTORS & BOARDS to help stakeholders create effective boards. One of my targets was the think-alike board. •

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