Many of the failures that have surprised markets concerning boards of directors being considered professionally solid and well reputed, may be explained, I believe, by the superlative dimension given to the materials and information processes, neglecting the primary gear by excellence: the process of people.
More than four decades ago, Peter Drucker pointed out that boards of directors did not work. The verdict – state his followers – encouraged changes, initially attacked by the corporate establishment, which allowed the development of meeting spaces for the different hierarchical levels of the organizations.
In the crisis the companies are experiencing today, there is an element that is repeated: the resistance of their boards to integrate the process of people in their power structures, considering, perhaps through ignorance, that they would seriously affect their authority. They fear, definitively, sharing part of their jurisdiction with the vision of people hierarchically dependents. But the interaction among the directors, executives and employees gives sense to the process of people, preponderant factor in the culture of a company.
Are not the procedures or rules that motivates human behavior, but the meaning each individual gives to his own action. We proceed according to our own interpretation of what is pertinent and valid to do given each situation. Thus, what inspires and gives sense to the individual and/or collective actions in an organization, are the consistent practices of its board members; and these, at the same time, reveal the priorities of the board of directors, later transformed into culture. Those values constitute the principles guiding the employees, under such parameters they adequate their actions and behaviors. For this reason, there are organizations in which corruption manifests and not in others.
Industrial and cyber engineering are necessary to control machines and data, but are insufficient to rule people. When the corporate power structure is based on the reverential obedience and this, for different reasons, loses its force, only hope of preserving what there is… until it drops. Then, it often appears, short term quick wins pondering above sustainable results.
It is the board of director’s task to “set the tone” with which the company relates with itself, with its clients, suppliers and competitors; the way of building and destroying alliances, and its way of doing businesses. The already mentioned, in accordance with the basic definitions of its company culture, changing all that is alien or extemporaneous to it.
Just then, we will be taking charge of the processes of people with visibility and focus to create actual economic and effective value. This process involves quality time and resources. But, previously, it demands introspection, the willingness to change and the conviction of its huge business and corporate benefits.