It doesn’t matter if it’s strategic, finance, governance, or HR related, board decision-making involves careful evaluation of a variety of data. This is especially true for the more complex issues that a board might have to deal with, like M&A or strategic decisions.

These types of issues often require significant qualitative input from the management team and external experts in order to formulate an opinion and fully comprehend the dangers involved. This level of detail needs to be carefully managed to avoid the decision-making process from slowing down or becoming time-consuming. These decisions can be addressed in more specific discussions with the board or in a separate workshop. This can save time and energy in other discussions of strategic importance.

The right people must be present when the board discusses an issue. Groupthink and the tendency of boards to rely on rubber stamps for decisions can be disastrous. It is best to have boards establish a routine to review every formal decision they get to determine whether the decision is suitable for that level.

To accomplish this it is important for boards to look at the various models of decision-making that are available. They differ in their complexity, but all have strengths and weaknesses. A good exercise for a board of directors is to discuss the pros and cons of these frameworks with their management teams in order to determine which one is the best for a specific decision.

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