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The reason is simple. Post Sarbanes-Oxley, We are in an era of board activism, said David Traversi, himself a one-time CEO and now an executive coach. He adds: Board members must be activists or they significantly increase their potential liability. Historically, it was inappropriate for a board member to communicate directly with individuals below the CEO. Today, of course, such communication is effectively mandated by law.
Particularly on this hot seat is the CIO. [B]oards increasingly recognize that information is a strategic asset for the company and thus they want to talk with the CIO, said Jack Capers, a partner in the Atlanta office of law firm King & Spalding and a member of the firm's Mergers & Acquisitions Practice Group. I believe there will be an increase in communication with the CIO.
Boards nowadays are keenly interested in how technology is positioning the business for success, but they also want assurance that the technology mandates in Sarbanes-Oxley, pertaining to data retention, for instance, are being met.
The headline news for CIOs: These board-level contacts mattera lotto your career. The right face-time can light a promotional rocket, the wrong can extinguish any dreams of upward mobility. But, although the minutes interacting with a board may be few, they also are easy to get very wrong.
In talking with the board, less technical is better than more, urges Catherine Brimelow, leader of PricewaterhouseCoopers' Corporate Governance practice. Brimelow said CIOs might have a comfort level with technicalities, but wrapping oneself in that blanket will backfire with the board.
Put yourself in the shoes of the directors, she urges, and that means staying on point while not getting lost in technical detail. Board members, with rare exceptions, are strategic thinkers, not geeks, and they want to hear answers to big picture questions.
The last thing a CIO should do is stand in front of a board talking technology. They will tune that out, said Steve Deedy, a managing director responsible for the leadership of consulting firm AlixPartners Information Technology Transformation Services Practice. Tie technology to the business; thats what the board wants to hear.
Importantly, too, said Brimelow, know that time before the board is a discussion, not a presentation. This is where many CIOs go astray. They see they are slotted for 15 minutes before the board, so they prepare a 13 minute Power Point presentation. Stop right there.
Talk for five minutes and leave the remaining ten minutes open for questions and discussion by the board, said Brimelow, who said they will have questions because these are high-powered leaders who are used to doing the talking. Be prepared for a dialog, not a monolog.
Do much the same in phone calls with directors. Consciously create space for them to ask questions and express opinions and never use these calls to launch into soliloquies.
Rehearse, rehearse, rehearse is more advice from the experts. Dont wing board contacts. Before any face-time with the board, practice the presentation and, suggests Brimelow, Try to anticipate the questions they will ask too. Smooth out the kinks and aim for a presentation that is informative, fast-paced, and thatat every stepis geared to the mentality of the board members who want reassurance, not a primer on technology initiatives.
Incidentally, never think the technical details facing the organization are somehow too complex to succinctly explain to the board. For one thing, the board is used to getting brief but clear reports on enormously complex legal and accounting issues and they wont see technology in a different light.
When management cannot explain an issue to the board, warns Brimelow, the board will wonder, does management actually understand it themselves?
Last advice comes from Brimelow who advises any CIO to commit to continuous improvement: Follow up board contacts by asking questions. Look for feedback. Ask: Was I too technical? Did you want more detail? Then use that info to be even better the next time. Nowadays, it is a dead-on certainty there will be an encore before the board because IT is now at the heart of business, which puts it at the heart of a boards concerns.