Have You Researched the DNA of Your Board?

Have You Researched the DNA of Your Board?

Board turnover doesn’t always mean that the board evolves or changes. Slow replacement of directors can mean that the “old” culture of the group, get rooted and, well … stuck in the DNA of the board as a whole.

By Kevin Smith

Wait! … Before you @ me, I’m not talking about individual board members, or anything resembling violations of privacy, et cetera. Don’t go calling HR on me! I’m talking about the board in its corpus, as a whole, as it were.

Picture the scene:

Location: A credit union board room.

Facilitator (to the nine board members in the room): “Tell me how your board has evolved over the years. I see a lot of boards that are still focused down in the weeds of operations instead of at the strategic horizon. How’s your board?”

Board Chair: “Oh, well, we’ve evolved a lot and come a long way. We’ve got two new board members, and they’re young Millenials. As a matter of fact, we can say that our board has changed over completely from the original members in the last 20 years. With our merger of five years ago we also incorporated two board members from the merged credit union.”

Facilitator: “That sounds great. So, I see your board has a credit committee and a delinquency committee. Those seem a bit too operational to me. What’s the thinking on those? How do you keep those strategic?”

Board Chair: “I thought those were required. We’ve always had them. They help keep us informed of how things are going.”

The correct translation of that last phrase is, “Because that’s the way we’ve always done it.”

Getting to the DNA of the Board

On one level, it sounds like the board has evolved, with new people, some regular turnover and so on. But when I ask them about the DNA of the board a different picture emerges. Despite the fact that board members have come and gone, this rarely happens all at once. It happens slowly … over time … and one or two board members at a time.

At this pace, new board members are incorporated and adapt to the current culture of the board. They tend (this is not an absolute) to blend into the existing culture or move on before too long. Members who disrupt too much or “just don’t fit” tend to have short tenures or may be less welcome than those who are more homogenous.

In this scenario, even when the board changes members, at this pace, the established culture of the board, even from generations ago, remains locked in the DNA of the board. This is how long-standing traditions can remain even when the current members are dead-set against stagnation. Even when they don’t support “this is how we’ve always done it” thinking. The old culture shows up in sneaky ways, without directors noticing.

Exploring the DNA of the Board

Have you explored the DNA of your board? Go back to the founding board members. Track who was on the board and when and chart out how the seats changed and what the timeline is. It can paint an interesting picture. Sometimes you will notice that there are (or were) one or two very long-serving board members. Those folks can have enduring impressions on the board’s culture and the organization as a whole. And that’s generally a very good thing. They tend to be dedicated and loyal directors who care deeply about the credit union and its membership. Please don’t misunderstand what I’m saying as a criticism of that dedication.

But the fact of the matter remains – the world of financial services has changed dramatically and much of our focus and strategic efforts need to change in order to remain relevant. And some of that “DNA” that remains … can hold a board back and keep things “the way we’ve always done it.”

Don’t let that happen to you.