Dynamic Directors: Aligning Board Structures for Business Success

246 Pages·1999·27.85 MB·English

by  Allan Blake (auth.)

DYNAMIC DIRECTORS
Dynamic Directors
Aligning Board Structure
for Business Success
Allan Blake
~
MACMILLAN
Business
© Allan Blake 1999
Softcover reprint of the hardcover 1s t edition 1999
All rights reserved. No reproduction, copy or
transmission of this publication may be made without
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No paragraph of this publication may be reproduced,
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and Patents Act 1988, or under the terms of any licence
permitting limited copying issued by the Copyright
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WIP OLP.
Any person who does any unauthorised act in relation to
this publication may be liable to criminal prosecution and
civil claims for damages.
The author has asserted his right to be identified as the
author of this work in accordance with the Copyright,
Designs and Patents Act 1988.
First published 1999 by
MACMILLAN PRESS LTD
Houndmills, Basingstoke, Hampshire RG21 6XS
and London
Companies and representatives
throughout the world
ISBN 978-1-349-14891-2 ISBN 978-1-349-14889-9 (eBook)
DOI 10.1007/978-1-349-14889-9
A catalogue record for this book is available from the
British Library.
This book is printed on paper suitable for recycling and
made from fully managed and sustained forest sources.
10 9 8 7 6 5 4 3 2 1
08 07 06 05 04 03 02 01 00 99
Designed and formatted by
The Ascenders Partnership, Basingstoke
Illustrations by Ascenders
This book is dedicated to Sandra
Contents
Acknowledgements
IX
Using the Book
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1 Introduetion 1
2 The Nature of Corporate Variety 27
3 Board Arehiteeture and Entrepreneur Companies 81
4 Board Arehiteeture and Family Companies 96
5 Board Arehiteeture and Listed Companies 128
6 Board Arehiteeture and Groups of Companies 151
7 Poliey and Business Perspeetives 180
8 Conclusion 214
Appendix: Evaluation Questionnaires for the Board,
Directors, Chief Executive and Chairman 219
Bibliography 225
Index 233
Acknowledgements
T
his book has been written to help boards of directors and the
companies that they direct. I owe a great debt of gratitude to all
the directors of companies that I have worked with over a ten-year
period. They have never ceased to amaze me with their insights and
their ability and humility that enable them to step back and reflect on
their positions. This is despite the enormous pressures that their jobs
involve. They have been the most constructive critics of my approach
to board and director development. I have been privileged to be
allowed access to their companies and playasmall part in their
development. Being closely involved helped me to appreciate the wide
range of companies that are in existence. Although there are some
generic responsibilities and skills required of company directors, there
are also important differences which vary according to the type of
company. As companies evolve over time, the obligations and respons
ibilities of directors, and their skills, also need to evolve. Directors, and
the boards of which they are members, need to be dynamic.
This book was largely completed whilst I was working at Leeds
Business School. I am grateful for the contributions of my colleagues
at Leeds, particularly Chris Pierce who encouraged me to write the
book and provided some valuable references. When I moved to the PA
Consulting Group in March 1997, I continued to pester my colleagues,
and am grateful for their tolerance and insights in the final stages. Alan
Warr and Lance Lindon have given me great encouragement. One
person has straddled my career at Leeds and the PA Consulting Group.
David Band's support and comments have been critical to the book's
publication.
There are some individuals and companies who have been good
enough to allow me to interview them, to use their companies as case
studies or reproduce their corporate material. A special thanks to:
Peter Jarrold (Chairman) and Peter Salt (Archivist), at Jarrold &
Sons Ltd
Tom Chappell, President, Tom's of Maine
Bob Mahoney, President, Citizens Bank of Massachusetts
IX
x Dynamic Directors
Mary Anne Dvonch, Vice President of Strategy and Technology,
Production Systems Group, Xerox Corporation
Grant Wakelin, CEO, ADC Software Systems.
Leif Edvinsson, Director of Intellectual Capital (and also 'Global
Knowledge Nomad'), Skandia AFS
Professor Clayton Christen sen, Harvard Business School
The greatest burden of writing this book has fallen on my wife, Sandra.
Her patience has been tested to breaking point. Anybody with two
children, Hannah aged seven and David aged ten, will understand the
pressures that a preoccupied partner places on the other. This pressure
is exaggerated when the writing of this book has straddled two jobs
and three houses in a 12-month period.
Using the book
Case Studies
Throughout the book ca se studies are used as a tool to illustrate key
points. Some of the case studies are named, where the company has
given permission or all of the information is in the public domain.
Where there is a need to preserve confidentiality, I have altered the
names and facts to do so, and made it clear in the title of the case study
that it is anonymous (i.e. Anon.). In some cases I have taken the facts
of a few companies and merged them into one case study compilation.
Again, where this has been done I have made it clear in the title of the
ca se study (i.e. Comp.). Some case studies are fictional, although based
on the experience of working with many companies. Again, these are
clearly marked (i.e. 'Fiction'). There is an index of ca se studies for ease
of reference.
References
All references appear in the Bibliography at the end of the book. There
are some references to 'Table N: this is the model constitution that
companies can adopt or alter, set out in a UK Statutory Instrument.
Terminology
The terms Chief Executive Officer (CEO), Managing Director and
Chief Executive are all used in the book. They all have the same
function, the different terminology reflecting the US, legal and UK
usage for the term that is used. I have used the actual term used by
those being referred to, the default title being Chief Executive.
Where to start
The book flows, hopefully, in the order it should be read. However,
Chapters 1 and 2 provide the details of the structure that is used in
sub se quent chapters. You can dip into Chapters 3 to 8 once Chapters
1 and 2 are completed, without losing too much of the theme.
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Case Studies
1.1 Donby Ltd (Anon.) . 12
1.2 Adam Ltd (Anon.) .... 14
2.1 Westbourne Galleries Ltd . 42
2.2 Precisions Ltd (Anon.) .. 47
2.3 PR Ltd (Anon.) .. 48
2.4 Land Travel Ltd .. 49
2.5 Mammoth pIe (Fiction, but ... ) . 50
2.6 The Armac Group (Fictional) .... 51
2.7 Grocers Ltd (Comp.) . 52
2.8 PR Ltd ... the next stage (Comp.) . 53
2.9 Complexity pIe (Fiction) . 54
2.10 Compute Ltd (Anon.) . 57
2.11 Bread Ltd (Anon.) .. 58
2.12 Victoriana Ltd. (Fiction) .. 59
2.13 Lloyds TSB . 60
2.14 Hoechst AG (Aventis) . 61
2.15 Cereal Foods pIe (Comp.) . 64
2.16 Books Ltd (Comp.) . 64
2.17 Anycompany pIe (Comp.) .... 65
2.18 Insurit of New York (Anon.) . 68
3.1 PR Ltd - Puppet to Partnership (Comp.) . 83
3.2 Mitchell & Hobbs (UK) Ltd 88
3.3 Gloss Paints pIe (Comp.) .. 92
4.1 Jarrold & Sons Ltd . 107
4.2 White Furniture Company . 114
4.3 Tom's of Maine 121
4.4 Sterling Asset Management Ltd . 125
5.1 Maxwell Communication Corporation . 128
5.2 Multinational pIe (Anon.) . 131
5.3 BTR pIe (BTR Siebe) .. 135
5.4 The Phillip Morris Companies Inc .. 136
5.5 Mayr-Melnhof Karton AG . 136
5.6 CSX Inc .. 140
6.1 Hoechst AG (Aventis) . 163
6.2 Sweden Match ... 166
6.3 Union Bank of Switzerland .... 175
7.1 Skandia. 199
7.2 Pharmical pIe (Fiction) . 206
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