Should the board decide a company’s strategy, or should senior leaders propose a strategy for the board to vote on? Neither. The best approach is an iterative one. First, executives should seek board members’ input on the challenges that the strategy should address. (New competitors? Future growth? An increasingly bloated cost structure?) Whatever their concerns, knowing them now will help you avoid a disconnect later. Next, as you’re considering strategy possibilities, go back to the board with them. Bring multiple approaches for dealing with the challenges you identified earlier. Note you aren’t asking the board to ratify a particular approach; you’re asking for advice and feedback. Finally, when you and your team have landed on your desired strategy, present it to the board. At this point, ideally, everyone knows the challenges to be solved and has had a chance to provide guidance, which makes it more likely that you’ll get the stamp of approval.
Adapted from “The Board’s Role in Strategy,” by Roger L. Martin
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