How to make the most of your non executive director and interim C-level leaders

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03/09/2019

The presence of a non executive director (NED) and other fractional C-level leaders in businesses of all sizes is no new thing. But the best way to use them is still often misunderstood, frequently missing the affirmative support that either role is able to offer business leaders. So how do you make the most of your non executive directors and fractional C-level leaders?

In our experience, the role of NEDs is invaluable. Not to replace, override or undermine the hard work of an existing CMO and other permanent directors within an organisation. And not as a cheap alternative to full time leadership. But as a valuable way of giving business leaders the information, support and perspectives that they need to make the best decisions possible.

You don’t know what you don’t know

No matter who we are or how intelligent we are as business leaders, we don’t know what we don’t know. Sometimes the simple anxiety of knowing there is information that we don’t have can be undermining to our decision making. That’s a problem, because we know we might not be making the right choices. However, because of that lack of knowledge, we don’t even know the right questions to ask.

That’s where strategically chosen NEDs can make all the difference. If you are aware that there’s a specific part of your industry in which you have a blind spot, you can look for a non executive director with the skills or knowledge you don’t have.

For example

For example, a client of ours, in a niche area of finance, has two NEDs to support the CEO. The first is not from a finance background, but has wide reaching general business experience. The second has a purely financial background in this niche sector, with more than 40 years in the industry. For this SME, which is growing at a rapid rate, the two non executive directors bring entirely different, but valuable perspectives. Together, they fill gaps  or firm up the CEO’s knowledge. They help inform the decisions that she needs to make for the growth and development of the company.

Sometimes, the non executive director who spent his whole career in financial institutions knows imperative facts about the industry that you can only know through experience. Sometimes, his presence simply provides reassurance. On other occasions, the non executive director with a general business background is able to see beyond the institutionalised ‘that’s the way we do it’ mentality. She gives the business the advantage of a fresh perspective, which in turn has provided a competitive advantage. Ultimately, the decisions always lie with the CEO. But she is able to make more balanced decisions than the ones she could make based on her inside perspective alone.

Checks and balances

At gigCMO we consider this to be the gold standard of NED intervention. It is an external perspective, a sounding board and a challenger to your internal company dialogue. They are not there to criticise or undermine. Often they are not even there to give you the answers. They ask the right questions, ensuring your decisions are the best that they can be and that they stand up when questioned.

In doing this, and by being an independent and impartial advisor, non executive directors form part of an instrumental system of due diligence, checks and balances. These hold business leaders to account for the decisions they make. They test concepts, theories and ideas against carefully selected criteria. The result is reassurance for all stakeholders from members of staff to investors.

Growth and development

Of course, this is not where the benefits stop. Fractional C-level leaders and NEDs can also be a conduit for members of the team to convey anxieties or questions to a leader. Those they don’t feel they are able to express themselves because of the differing politics experienced as a full time member of staff.

Non executive directors can also provide more detailed direction in relation to particular skills or challenges. That might be problem solving or being more proactive in creating strategies to take a business to the next level. For example, in her recent interview, Fractional CMO Susanne Pugsley talks eloquently about how strategy can be laid out by an external specialist in an area like marketing. It can then be executed by senior management on a day to day basis, and revisited at intervals throughout the year by the consultant.

CEO support

One of the often overlooked roles of a non executive director is the emotional and professional support provided to business leaders. A unique position without agenda, a non executive director is there exclusively to support a business leader. The person who often doesn’t have anyone else to turn to when they have questions of their own. The person who sometimes needs to make sure they haven’t got lost inside their own organisation. And the person who’s often expected, by every other member of the team, to have all the answers all of the time. With the best will in the world, that is a lonely and virtually impossible task to do alone. Or at least, to do well alone.

Who makes a good NED?

With all this in mind, we believe the best non executive directors tend to be those who are coming into their ‘third careers’, combining experience with perspective and talent. When they come into an organisation, they bring neutrality and a lack of personal political agenda alongside a big picture world view, or a specific specialist knowledge. That allows them to really listen to what’s happening in a company, asking the questions that will help leaders navigate into a successful future.

That’s how non executive directors add value. Contact gigCMO to see how an outside perspective will add that value to your business.