First Year on the Board
Written by Oli Salonen
How would you feel if you were invited to become a member of the board of directors of a mid-sized, international company? Excited at the opportunity? Or paralyzed by self-doubt? I felt all of that and everything in between when I received a phone call in April 2016 from Mikko Viikari, co-founder and employee of Futurice. He was inviting me to become a member on the board of Futurice. I was dumbfounded. After hanging up, my mind tried to twist this into a narrative that made more sense. “Did he just offer me membership on the board? Impossible… I think he just extended an invitation to participate in some of the board meetings for whatever reason”. I played the conversation over and over again in my head trying to decipher the message from the words that I still remembered, but it soon became apparent that I was in fact offered the role of a member of the board.
It has now been over a year since that call. Attempting to stay true to one of our core values, transparency, I wanted to help demystify what the board is. I also want to share how I see my role there, and what I can give back as a result to create more accountability towards the rest of Futurice.
What does the board of directors do?
The board is not the captain of the ship called Futurice. The board does not create the vision or strategy of the company. The board does not tell the organization to focus on the latest buzzword in the business. The board acts in a supervisory role for the organization, which means calling bullsh*t if someone has taken shortcuts in their thinking when it comes to setting the vision, budgets, or targets for the future. Sometimes the ambitions for the future are too conservative, and it’s the job of the board to push the leadership to keep reaching for ever greater heights. Occasionally it means holding up a mirror in front of the faces of leaders to help them see their role in failure so true learning can take place.
However, the board is not just a negative Nancy. Although the stakes are high, it still means that a safe-to-fail environment needs to be fostered by the board to encourage continuous improvement in order to reach those heights. One of the most important things it does is show support for good work and great initiatives, and it offers sparring to iron out wrinkles in plans.
There are also of course obligations set by law such as the traditional responsibility towards shareholders. As opposed to the usual stereotypical view of maximizing shareholder value at all cost, the board works to maximize shareholder value within the constraints that makes Futurice successful now and what could make it successful in the future.
How do I see my role there?
How do I fit into all of this and what could I possibly bring to the table? I try to use what others at the table do not necessarily have, which is a unique perspective into the workings of the company. I spend about 50% of my time in the trenches doing project work for clients, which gives me firsthand knowledge of the type of work we do, how we work, the customers we work with, what drives project success and where the pain-points in the work generally are. I see in unfiltered detail what the day-to-day of my team members is like. I act as a supervisor which means I understand the aspirations of our employees, and what they want out of a career in this field. I am also a tribe chief which means I’m involved in the operations of our Berlin team; this gives me knowledge of how sales, staffing, recruitment, reporting, and other aspects of running a unit with P&L responsibility works in Futurice. Putting all of these different perspectives together with the seat on the board, I get a cross-cutting view of how our organization works at nearly every level of abstraction which is illustrated in the diagram below.
Roles with varying levels of focus vs. abstraction.
The pyramid is on its side to stress the point that I see all roles as equally important. What is different in each section is the broadness of the view and the level of abstraction. In project work the view is narrow, highly focused and with minimal abstraction on the nature of the business and the work involved. At the board level, the view is the broadest possible, but at the same time it operates at the maximum level of abstraction.
The danger with a laser focus view is that the work loses its connection to the larger picture. We often forget to share our stories from daily work with others, even though there could be countless hidden gems there in the shape of lessons learned and finely honed practices. We too easily forget how the work ties into the vision and direction of the company and what our role in its success is. On the other hand, the danger with a high level of abstraction is that it loses its connection to reality. Taking a broad view is impossible without abstraction, so how can the board of directors stay relevant or be trusted if the board is detached from reality? Ralph Stacey in Complexity and Organizational Reality focuses attention to this problem:
Decision-makers are basically concerned with taking some action, exerting some control, in relation to many local interactions in which they themselves are not directly involved… the need to ‘see like a state’ leads naturally to the building of models and the drawing of maps and ‘rich pictures’ to simplify and delineate distant, widespread problem situations… this approach to problem situations necessarily amounts to both first and second order abstracting from the experience of ordinary local interaction, and we seem to have a strong tendency to forget the abstract nature of our maps and models and deal with them as the things of reality, while people and their local interactions disappear from view.
It is here, as glue between the local interactions and abstractions, that I aim to have the most positive impact. On the board, I try to share as much as I can about the reality on the ground, about the people, their work, the culture, the ambitions, strengths, and weaknesses, so decisions there can be congruent with reality. In project work and every other level in between, I try to share the holistic thinking from the board to help others tie their everyday actions and decision making to the bigger picture. It is this sort of constant jumping between levels of abstraction and local interaction that Ralph Stacey advocates in his book to deal with complex adaptive systems, such as organizations.
It was very intimidating to step into the first board meetings, not knowing what is expected and how I could contribute; especially when surrounded by others with vast experience running companies, impressive networks to other giants in the industry, superb understanding of the market and of other board-level topics such as market valuation and investor relations. It got much easier as soon as I fully understood that the point is not for me to regurgitate the same ideas; the point is to diversify the pool of ideas and question things. That I can do. I will also push myself to keep bridging the gap between the board and the rest of Futurice by supporting, communicating, and sharing knowledge with all those I interact with on a daily basis.