IT leaders often find themselves called upon to address their companies' boards of directors. For many, the boardroom is an alien environment, full of high-powered execs with little affinity for technology. To succeed in this setting, CIOs must effectively convey their wins, opportunities and challenges in helping achieve business goals. For tips on wowing the board, we turned to some of the more board-seasoned members of the CIO Executive Council.
Learn to prepare for board meetings and build relationships with directors during a teleconference offered by the CIO Executive Council from 4-5 PM EST on Jan. 13, 2009.
Know the players.
Jeff O'Hare is senior vice president of enterprise information technology at business process outsourcing provider West Corp. At past employers he has researched board-member backgrounds, then used this information to frame his presentations and follow-up conversations. O'Hare focused his information gathering on areas like functional experience, industry, company size and comfort with risk.
"When I was making a presentation to a board with heavy finance and operations experience, I made sure to include an appendix of highly detailed financials and a snapshot of rolled-out milestones directly from the actual project plan," says O'Hare.
Develop ongoing relationships.
Pamela Rucker, vice president of IT at PSC, a privately held environmental services company, holds regular pre-meetings with directors from the PSC executive board and representatives of its ownership to learn their points of view. Rucker estimates she spends 20 percent of her board interaction time in these one-on-one meetings. She also uses them to ask questions and air concerns privately. "The actual board meeting can't be the first time that you're telling the board about changes or plans, or they're going to feel blindsided," she says. Rucker suggests using these meetings to sell your ideas prior to presenting them formally. They also let you tell your story not only multiple times but in multiple ways. "Sometimes I may have to present information three different ways in three different meetings in order for everyone to get it," Rucker notes.
How does Rucker get time with individual board members? Her face time with directors from her own company happens in monthly IT Steering Committee meetings they attend. For members from the company's ownership group, Rucker watches for their particular interests during board meetings, then establishes a rapport around those topics.
David Webb is former CIO of SVB Financial Group, where he is now chief operations officer. He agrees that engaging the board isn't just a quarterly, formal interaction. "You need to want more interaction and find ways to do so. If you don't, you won't build that relationship," he says. Webb finds that access to board members becomes easier over time as long as you have good reason to meet. "The first call is always the hardest. If you have difficulty making a cold call, have the CEO clear the path for you," he says.
Get feedback from a board buddy.
Twila Day, CIO at $33 billion food company Sysco, developed a sounding board within the board. She pings select members prior to her presentations to preview what she wants to share with the group. She developed this tactic after a one-on-one meeting with a new board member who had a strong technology background. When a second member with similar experience joined the board, Day asked if she could send both of them her presentations ahead of time for their input. This peer review helps Day fine-tune her message, gives her fresh ideas from technologically experienced board members and helps avoid last-minute surprises during the actual presentation.
O'Hare's objective in a board presentation was to get the right message across. "I typically provided them with enough information to guide them to the conclusion that I wanted, but I didn't tell them my opinion right away," says O'Hare. He found that buy-in was stronger when members felt they contributed to the solution. O'Hare organized his slides using the SOAE model (situation, opportunity, action, expected results) and never arrived at a board meeting without multiple solutions to a stated issue or problem in his back pocket. "I could demonstrate that an objective and thoughtful approach was used in resolving the problem," he says. "I also found that having different ways to solve a problem was a good way to prepare for the eventual questions."
Let Financials Do the Talking
In his board presentations at past companies, Jeff O'Hare, senior vice president of enterprise information services at West Corp., included the following financial information (usually in a one-page financial overview, with supporting details in later slides). All of his finances were tightly aligned with the office of the CFO, and the financial team validated the numbers. In some cases, O'Hare would present the high-level finances and then let the CFO field the detailed questions, which showcased collaboration at the executive team level and sent a powerful message to the board.
What a financial presentation should include:
- Impact to this year's budget/P&L
- Impact to cash flow
- Impact to EBITDA
- Impact to net income
- CapEx and OpEx
- Return on investment and/or cost benefit analysis (CBA) with supporting details
- Revenue projections, margins, market analysis/competitive analysis, geographical variances/globalizations, etc.
- Carrying costs on investments, if applicable
Get to the point.
As Webb constructs his board presentation, he asks himself, "How do I get my point across in the first thirty seconds?" Day keeps her's concise. "I lay the foundation and then, in future meetings, I move forward with more of an update' format," she says. O'Hare used an executive summary at the beginning to grab attention and then shared supporting information. Emphasize profitability. The most important thing in any board communication is to tie it to profitability and business value. "CIOs really have to think like a CEO and investors when presenting to the board," says O'Hare. "For example, it's not IT cutting costs; it's about how this cost savings idea fits into the overall cost model and positively contributes to competitive margin." This is what board members want to hear about. At past employers, O'Hare sent customized versions of his quarterly IT reports to the board. These reports profiled technology objectives and successes and tied them to business value.
Involve your team. O'Hare involved senior team members (director-level and up) in prepping for board meetings and providing input on the presentation. "My philosophy was that if they needed to come off the bench, they needed exposure so they were ready," he says.