COMPANY MANAGEMENT
Experience on tap
Whatever the size or scope of your business, a Non-Executive Director (NED) can provide invaluable insight, guidance and stability when you need it most. Here Jim Doyle shares some of his experiences of taking this key role, revealing the extent to which a NED can prove invaluable – especially in unexpected circumstances.
It was June 2011 when, as the non- executive Chairman of a software company, I received some devastating news. After a short illness the Managing Director, one of the founders and major shareholders of the business, had died.
CONTINGENCY PLANS
Any board of directors needs to ask itself the question of what would happen in such an event – indeed, it is one of the key questions that they can expect their NED to ask them. The board must carefully consider the robustness of the company’s Risk Register, and what contingency plans are in place in the case of such an adverse event, in this case the loss of a ‘key person’, at the highest possible level. Recognising the possibility of such a loss, and its ramifications, can be the basis for establishing financial cover from a commercial insurance policy. However, the suddenness and sadness of losing a colleague and a friend is not in truth something that one can emotionally prepare for. Such was the situation in which I found myself, effectively having to steady the helm while the Board itself was reeling from the shock.
Jim Doyle
IMMEDIATE CHALLENGE My immediate challenge as the non- executive Chairman was to ensure that objectivity was kept to the fore across the small organisation. The company had to continue to fulfil its orders, to support and reassure its software customers, to improve and develop its current release, to maintain its Quality Assurance Systems, and to pay its suppliers and staff. The mantra ‘Keep Calm and Carry On’ is seen everywhere these days, but still it would not have been inappropriate if emblazoned on the company’s front door.
THE WAY FORWARD
The Board obviously needed to debate its reaction to the loss of one of their own, agree between them the most sensible way forward in the immediate and medium term, and also carry its shareholders along that route. It was incumbent on the executive directors to reassure their teams that there was no need to be concerned about the ongoing health of the business. One of the features of this particular company is the ‘large ticket’ nature of its training systems: six figure purchases, bureaucratically slow by nature, aimed at medical and educational institutions, notwithstanding the current economic climate.
GLOBAL STRATEGY
The company’s strategy remains global in scope, based on cooperation with sector specific local distribution networks, reflecting the timescales involved. Three months after the death of the MD, five systems were sold into Australia via our Sydney based distributor with whom we had established a relationship in 2008. This was as reassuring psychologically as it was commercially. It also reaffirmed the message that the company and its strategy are more than the sum of its parts. It was a creditable achievement that reflected the passion the MD had, and which his colleagues still have, for the business, which continues to look forward to an exciting future.
BOSTON EXHIBITION
It is interesting that this same company recently exhibited in Boston at a location impacted by Hurricane Sandy. Monday’s seminars and presentations were curtailed at 2pm as a result of the superstorm, but by Tuesday normal business was restored. Perhaps bolstered by their experience of handling the bereavement of their friend and colleague, I am confident that the directors and staff on the ground in Boston had no difficulty in putting the inconvenience of a disrupted conference into its proper perspective.
VITAL SKILLS
A freelance director operating through a limited company can add value in a non- executive basis at little risk. If introduced by a trusted adviser, there are no upfront recruitment fees and no redundancy package if the chemistry proves inert. Accounting partnerships such as PKF, Baker Tilly, PWC and Grant Thornton maintain a panel of such NEDs, comprising professionals from many fields, and advisers can ‘matchmake’ suitable directors to businesses for maximum benefit.
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www.windenergynetwork.co.uk
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