Building a Board

I've built a nice Board practice over the last couple of years and have clients ranging from $1B public companies to startups with 50 people. Technology, energy and even health care clients. What have I learned? That it is terribly important to pay attention to building your Board. If you get it wrong, tearing it down could tear down your company. Here are five tips for CEOs and Directors to consider:

1. Don't focus on celebrity Board members. It's not worth the headaches and they'll hijack the dynamic half the time while the other half, not adding any real value. Focus on people who are level headed, focused, will follow through, really WANT to be on your Board and who have reasonable chemistry with others (not too much chemistry, see below).

2. Focus on people with real experience in the domain in which you're operating, either functionally or with industry experience that will move the needle for you. Otherwise they're wasting space and time.

3. Compensate Directors properly. Don't be penny wise and pound foolish. Being a Director isn't as sexy as it used to be, it's not easy money and it needs to be taken seriously. So compensate people accordingly.

4. Make sure no one individual has too much control over the selection of a candidate. Boards are about constructive debates and healthy critiques of a CEO and their management team, etc. Don't hire "yes people." Hire someone who will shoot straight, first and foremost, but do it with class and tact.

5. Take your time and do it right. Be thoughtful. Don't be impulsive and "fall in love with people." Be dispassionate and objective. Treat the hiring of a Director as you would any key executive, including a CEO. Remember, you have to live with this selection and it's nearly as hard to fire a Director as it is a CEO, possibly harder...