308. From the C-Suite to the boardroom: Christiana Smith Shi on what it takes

There are a set of decisions that boards get to make, but it's a limited number. And in other areas, it's the CEO and the leadership's team call. They want your advice, they want your perspective. Hopefully there's trust both ways. But in the end, they're supposed to run the business and you're not. And I had to remind myself of that. From McKinsey and Company. I'm Sean Brown, and welcome to Inside the Strategy Room. That was Christiana Smithshee discussing one of the challenges of moving from the C suite into the boardroom. Christiana is the former president of Nike's Direct to Consumer division and a seasoned board member with more than 14 years of service. She's also a former McKinsey senior partner and currently serves on the boards of Columbia Sportswear and ups and as chair of Habitat for Humanity. In today's episode, Christiana speaks with Senior Partner emeritus and Board Director Celia Huber about the development opportunity board service offers executives. She also candidly shares her thoughts across topics such as board effectiveness, the complications of CEO transitions and succession planning, and recognizing the value of having an activist investor in the room. Christiana's insights and guidance will resonate with those on a board as well as those who are considering board service. And now, here's Celia. Christiana, welcome. So glad to have you here today. Thank you, Celia. It's great to be with you. You have had a successful career both as a consultant, as an executive at Nike, and you've served on multiple boards, including Williams, Sonoma, Mondelez, West Marine, and currently Columbia Sportswear and ups. So maybe if you just step back and think about your first board, what attracted you to board service? I think I joined my first board in part to see what it was like. Right. I think we all just want to understand what's it like to be on the other side of the table, because as executives or as consultants working with clients, you're presenting, you're advising. I wanted to see what it was like to actually sit in the seat. But secondly, I had seen with clients when I was at McKinsey the terrific impact on executive development that sitting on a board can have on someone. And at that point, I was COO of Direct to Consumer at Nike. I was certainly in line to become president of Direct to Consumer, which ultimately happened. And I thought there was probably a lot of enterprise perspective that I would pick up if I sat in a boardroom. And that is exactly what happened. So tell me about that initial transition. You have your executive hat on during the day and at board meetings, you have the board hat on. What surprised you most about that transition? Were there anything that was hard for you? Honestly, I think the transition to being a board member from an executive, for someone who's been a senior advisor, is probably easier because, you know, at the firm, even as a senior partner, you're used to knowing that you're not the one making the decisions you're recommending, you're doing the work, you're certainly doing your best to tailor the advice to the situation, to the client, et cetera. But ultimately, it's their call. It's the same thing when you're in a boardroom. And for some executives, that is in fact, the most difficult hurdle to overcome as they move from running their own show to sitting on a board, which is there are a set of decisions that boards get to make, but it's a limited number. And in other areas, it's the CEO and the leadership's team call. They want your advice, they want your perspective. Hopefully there's trust both ways, but in the end, they're supposed to run the business and you're not. And I had to remind myself of that several times, I think, particularly when I serve on boards that are close to my field of expertise, where you sit there and think, oh, I know what I'd do if that was me. Well, isn't you? And that's not exactly the advice that's most helpful to them. Our annual board survey shows that the amount of time that's needed for board meetings prep is upwards of 30 days, and it's been increasing. Tell me how you made the time as a sitting executive to do that. You know, I didn't know about that survey on board time, Celia, but I am not surprised at all. I've been serving on boards now for 14 years, and the time commitment has only gone up. I think some of that was driven by the various incredible challenges in the macro environment that we've all dealt with, including the pandemic which caused many extra board meetings, many extra committee meetings, et cetera. But I think there's also just a higher perception of risk in the business environment. And so what I tell people when they're considering joining boards now is they should assume that it will take about 15% of their time, which one month over 12. It's probably around the same. Right. And that's because you forget that you've got the committee meetings and the board meetings when you're there together. But there's almost always work in between extra committee calls, calls with the CEO if you're chairing the committee, all the prep that you have to do, and then there's the reading of the board books, which is a whole other topic. We could touch on a sore spot for some. For some. And that could be two days, two solid days before a board meeting just to get through the material they sent you. Right. And that's assuming that nothing awkward is going on, whether it's Covid, an activist investor, or something exciting like an M and a deal that needs, you know, rapid attention. Absolutely. Or an activist attack that probably is one of the most time consuming when the board needs to respond to a proxy fight or an activist challenge. For executives that are thinking about this as part of their own development. Do you think nonprofits are a good training ground? Is there something they should be doing to think make themselves more attractive to corporate boards? So I always say nonprofits can be a very good stepping stone to a corporate or public company board service. However, you've got to come at it from a perspective of holding the bar very high. So I say if you're going to do nonprofit board service because primarily because that's your passion, that's how you want to assist. That's why you, how you want to serve your community and your, your fellow humans, then do whatever you want. If you want to do it to learn the kinds of things that you'll need to know and to make yourself a better candidate for corporate board service, then you need to pick a very high quality nonprofit to start with. You want to understand their governance and you want it to actually be tight, respectable governance. For instance, they need to have their financials in order and you want to have committee structures so that you can actually understand that most of the work gets done in committees, not in the boardroom. And you want to have a leadership team that works closely with the board. So if it's meant to be a stepping stone and a training ground, then you need to actually examine it from the same kind of lens and perspectives that you would a corporate board. And then if you make those right choices, you will learn a lot. And you do make yourself a more attractive candidate for corporate board service, without a doubt. Let's pivot a bit to talking about the different types of boards. You've had a unique set of boards that you've served on, everything from very large public companies to public companies with family ownership to smaller companies as well. Talk to me about what's been some of the biggest differences among those boards and what have you seen as maybe pros and cons. If you were choosing against those, well, first I would even throw in that mix also large global nonprofits. Because now that I'm chairing Habitat for Humanity International, I'm really getting a sense of, at that scale, what is very similar to running or be on the board of a large for profit and what is actually very different. So you throw that into the mix. There's just a lot of scrambling, head scrambling things that you can find yourself get caught up in. I think, you know, companies in general are on a spectrum of maturing. So if you're working with a private company or a startup or a small, just IPO'd kind of company, and you're on that board, it's very common that you're gonna find the board is a bit more involved in operational decisions, that they play a bit more of a consultative role individually to the CEO and to their team. The CEO is often dealing with a board that is a mix of board members he or she may have selected and board members their investors have told them they have to take. So sometimes you also see the dynamic in the boardroom is a little different. Takes a while to warm up and for people to really start working with each other because they aren't all coming from the same perspective. If you go all the way to the other end, to a very mature, large for profit company, I think you typically find a more, more cohesive boardroom initially in the sense that most of the people are experienced, most of them know what they're there to do. Some of them are still in operating roles, some aren't, but the mechanics of it are pretty well understood. And the board is more focused on a narrower set of topics, frankly, which is around, of course, the overall strategy, the overall investment levels, the capital allocations, and then hiring, firing, developing, evaluating the CEO. And how was that different at Habitat for Humanity? So when you're dealing, when you're kind of sitting on the board of a large nonprofit, you first start almost every conversation and discussion with the mission, with the mission. What are we here to do? How do we serve that mission? How does this decision relate to our ability to serve that mission? You also have the craziest financials, honestly, unallocated revenue, allocated revenue. You've got grant money. You've got grant money that's been promised but hasn't shown up yet. All of the accounting actually is different. GAAP is different. So I sit on the audit and finance committee for Habitat for Humanity, and I had to invest, I think, the first three years in really being a competent audit committee. Member in that environment. So that's different. And then the team is different. You have people who are there, typically compensated at a lower level than you'd see in the corporate world, but incredibly good at what they do and incredibly passionate about what they do, but not always as experienced in business because that's not what they kind of came there for. They came to change the world, they came to make things better. In Habitat's case, we're looking to increase access to affordable housing for everyone. So you've got people that are coming from construction, you've got people that are coming from resource development, grant making, all those sorts of things. And you've got the board who's typically coming from either a large donor perspective or a corporate experience perspective. It takes a while for that kind of group to really gel. Yeah, I can see that. Speaking of different groups, you've also served on a family dominated board at Columbia. How do you think that's different? And you know, how do you create value when there's actually such a strong shareholder owner mindset among one of the board members? Right. You know, I didn't intend to do this, but when I look back over the boards I've been on, they are largely founder or family led companies. And what's different about that, I think, is their stage of development and their leadership can be quite different from a 75 year old, you know, Fortune 100 company. If the founder is still involved, you have both the blessings and the challenges that come with that. The blessings are the founder or the family head who's running the business truly understands in their DNA what the company is there to do. They know all the history, they understand the brand, the legacy of it, and they typically have deep admiration from the employees going all the way down to the front line. Right. The kind where they walk through the cafeteria and everybody wants to stop and get a quick hello from them. Right. That was certainly the case with Phil Knight at Nike. Right. If you saw Phil in the cafeteria, it made your day. Right. That's the blessing. The challenge that comes with it is, for starters, it's very hard to find the balance of giving advice that feels brand right, that feels right to the legacy of the company, but also is contemporary. In other words, part of what the board's job to do is look down the road, look ahead, bring in ideas from outside. What this particular company does that can be a bit more challenging in a founder led kind of situation. And then whether it's founder or family led, the other challenge that most boards will wrestle with is Succession planning, CEO succession planning. Because if it's the family, and the family particularly still has, you know, the dominant share position in the company, even though it's public, then there may be an heir apparent in the family, but it's just as challenging. And I had a client when I was at the firm where the next generation didn't want to run the business. And so the challenge was the founder and patriarch of the family could not accept that none of his sons wanted to actually step in and run the business. And the board's job was to think two or three years ahead down the road and make sure we had someone who could, which meant we had to look outside. That tension is really, really challenging. And you'll see some of that in a corporate environment. When a CEO has been grooming and mentoring an executive that they really think should be their successor. But it's to a whole different degree when they're related by blood. Yes. And how can the board be supportive when the transition has gone from either a founder or family to someone who's non family or wasn't there at the beginning? Is there a different type of mentorship that the board needs to provide? I think for a board that is trying to be helpful to a new CEO after a transition, one of the factors that will affect how easy or hard that is is whether the previous CEO in this case would be a founder or family member is still around. If they are a large shareholder, they are almost certainly still around. They may be sitting on the board, they may not have an official role, but they just own 35% of the shares in their family trust. So there is, there's quite a halo. And I think the board's challenge, as always with a new CEO, is to help him or her be successful. And so there's coaching and mentoring, particularly from either the board chair or the lead outside director, depending on the structure. But if it comes to a point where the founder or the family head is making it difficult for that CEO to be effective, then the board actually has to step in. And I had to do that on the first board I was ever on, where the chair at the time I joined the board was the founder and the CEO was his partner in crime, who had almost started the business with him, not quite. Joined a few years after that and could do no wrong in the chair's mind, really could do no wrong. And yet the company was not thriving. We wanted to replace the CEO, and in the end it meant we also had to replace the chair. And that was a two year process. I mean, some of this, if there's no crisis happening externally, it's not bad to take some time if you have it as a board, because some of this needs to be done in a pretty deft way. So to move a founder out of the chair role that I think he thought he'd die in to being on the board, to ultimately off the board, it took us several years, there were several phases and we appointed an outside chair and we found a new CEO and the founder was around the company all the time, walking the hallways for the first days the CEO was there, we had to work on the behaviors that were acceptable and build a relationship between the two of them. But over time you can get there. I think in those situations, patience is truly, truly a virtue. Yeah. It's interesting what you describe as a founder or family led company. I've also seen when there's been an iconic CEO, someone who's been there for 10 or 15 years, 15 years, has grown the company, great results, and yet it's now time for that person to step down. And it has a lot of the same dynamics, particularly if that person then takes a executive chair role during the transition. Yes. And I think that is actually one of the biggest determinants. And so I always recommend to boards that if you have the previous CEO, the icon in particular in an executive chair role, or even if it's non executive chair, that it be time limited. So it's for the first 12 months that so and so is in the role. And that was the case with one of the more recent CEO transitions that I was involved in, where the previous CEO who had started with the company, you know, as a package handler, moving boxes around in a warehouse, he was CEO for a long time, but then he was executive chair for a year and that was the end of it. And so before we even made the transition, we had that in the writing, you know, as part of the deal. I think that's when it's a lot harder to leave it open ended and then realize that that was a mistake and you should change. Right. Maybe let's pivot a little bit and talk about board effectiveness. So, you know, there is a, I think now a dated NACD study that said something like over 80% of board members think that they're highly effective and only 25% of the CEOs would say their board is highly effective. So in your mind, what makes a great board member? What makes a great board member, first, I think, is that understanding of what we talked about a while ago, which is that you are not there to operate. You've got to have that. And it can be hard, particularly when it's in your field and you really do feel like, I could do this. I think the second thing is, can you build trust? And it's true for anyone in any team, right? That trust is the secret ingredient. But it's particularly true with a CEO, because it's a funny situation when you really think about the fact that CEOs are helping to select board members, but those board members effectively are the CEO's boss, right? How many times in our career did we get to hire our boss? Never, right? Never. You may be some companies I know, you might get to do it like a cultural interview or take them to lunch. Nobody's making a decision about their boss, but that's how it works, right? So you interview with the CEO in one kind of tone, and then literally, the first board meeting you show up at, you've got to elevate that, and you've got to talk a little bit more firmly about things you believe in. And you've got to make sure you listen really, really well to understand where the CEOs coming from. But you got to make that transition, which is, I am now in the board. I'm here to represent stakeholders of all kinds, not to represent you as the CEO, but to support you in creating the value that we all know that this company can create. And I think any board member that keeps that kind of mindset and that consultative approach, but is willing and acknowledges that there are certain decisions that they have to actually tell the CEO, and sometimes tell them the opposite of what they want to hear, that that will make a good board member. Good. Let's talk a little bit about committees underneath that. So you can be a good board member, but what makes a good committee member? And, you know, typically directors are assigned to one or two committees, depending on how the corporate corporation is structured. And what do you do? You talked about the audit committee at Habitat for Humanity. What do you do to be a good committee member? I have so many thoughts on this, Celia, because one of the realities of board service is that most of the work gets done in committee. That surprises people sometimes, right? You sit in the boardroom, and a good chunk of the time of the meeting is the committee's reporting back out on what they did and bringing decisions or recommendations to the board that the full board has to approve. But also in committee itself, you make some decisions that, based on the bylaws, only the committee has to opine on. So for Starters, you want a good committee member to understand the value of the work that's happening there. And it is particularly difficult when you have a committee member who doesn't do the reading, right? Like this is like doing your homework before you show up at school. As irritating as it is sometimes to get a board book that is 450 pages long and a committee book as part of that, that's 85 pages, and you got two committees and you're trying to read all this stuff, you need to do it, because that's what you're there for. And you also need to read the appendix, you know what I mean? Because there are some boards that put a lot of the really juicy stuff in the appendix. So you've got to read the whole board book. You've got to have a point of view, because a good committee member actually opines on things so that you can get a good discussion going and the committee can work its way through any tensions, come out on a better place, right? And then I think the last thing is you've got to be willing to actually go deep, because in committees, you go deep. So like I said, in nonprofit, if you're going to be on audit and finance, you go deep on the most convoluted financial statements I think exist. If you're going to be on the risk committee, like I am at ups, for instance, you need to understand and be engaged in cyber risk, in physical security risk, and location risk, in aerospace risk and aviation risk. And just a whole range of things that we get into. I love that. I think that's the part of the fun of being on a board, in my opinion, is how much you learn in the committees and how current that you can stay and how relevant you can stay as an executive, even when you're not in an operating role, because you're able to engage in decisions at the level committees do. And if you're a board member, should you aspire to be a chair of a committee or. That's not necessarily something that's for everyone. I think anything that you do, you ought to do with an eye to potentially leading it at some point. That's me. I would love to have committees full of committee members who all aspire to be the chair, because then I think they would go deep. I think they do the work. I think they'd engage the way you want them to with the leadership team. But not everybody can be the chair. So I don't think it's like front of mind most of the time when you're sitting In a committee room. I chair comp and human capital for ups. And when I joined that committee, I would have been wildly intimidated if somebody had said that that's where they saw me going. Because the previous chair, the chair when I joined had been in the role for 10 years and she was gifted and she was deep and I had a learning curve. But once I was in it for two or three years and there started to make rumblings about, you know, well, Christiana, you know, would you be interested? I realized no. Yeah, this is for my development. For me to continue to learn from board service, I need to push myself to get into those places. So I've chaired a governance committee, I've chaired comp and human capital, and obviously now I'm chairing a global nonprofit. And I think that's where the continued growth and development comes for me and I'd say probably for anyone else doing board service. When you think about learning, there's learning in the job like you just described, but there's also an obligation to keep yourself current. So how do you think about learning about new topics and particularly anything on AI risk, industry trends that you would say, hey, this is either more challenging or easy and there are places to go to learn? I think part of what's changed in the role of being a director is there are a lot more issues that you need to understand and you need to stay current on. Because in the past and even now, there's only three required fiduciary committees, right? There's audit, there's comp, and there's governance. But you will see committees like Risk, like we have at ups, airlines, banks, they all have risk committees and they have different risks because the risk environment and profile of their business has gotten much more challenging. You will see a lot more attention in audit and finance committees, to cyber risk, to privacy laws, to AI and what the impact is that it can have on the business. You'll see AI being discussed frankly at the entire board level, as it should because of the transformational potential. I think there's probably maybe a three part way that I would suggest that board members make sure that they continue to stay relevant because that's really what it is. It's about. Is your knowledge base relevant? I think one is in, in the boardroom, in a well run board, there will be board education. And in fact at Habitat we use one meeting a year with where we hold part of the agenda for board education and we select the topic based on current issues, around the strategy or the environment, but also just around technical Issues like cyber risk, like AI that we feel like we want our board to go deeper on. So one I think is, does your board actually take some time for board education? And if not, can that be something the board builds into the agenda? The second is there are many, many, many board support organizations that, like NACD, National association of Corporate Directors, 50, 50 women on boards I could go on that are offering educational programming for directors and even certifications. Right. If that's something you wanted to go that far on. And I, I don't think any of us have time to run around to conferences all the time, but picking one or two that make a big difference in a given year, I try to always do that. And typically most boards have some kind of funding for external board education and if not, invest in it yourself because that is really where you can take a particular topic or area and go deep on it. And I think the third one is much more about industry specific topics that relate to the business of your, the company and your board that you're on. And I think for me that's a lot about seeking out that kind of information and you know, doing some things online and making sure that you're reading and staying current on like the clipping services and things on the issues of that particular sector. You need all three angles, I think, to really stay fresh. Yeah, it's interesting. I've subscribed to a number of the industry journals for the board that I'm on because I find it's an easier, it's almost easier than the clippings because there's some articles that really wouldn't hit the clippings but are interesting from a contextual standpoint outside, like adjacent to the industry. Exactly right. And I, I think that's a great approach is subscribe to the industry journals, go to their one big conference a year. So, you know, my area of, of focus and passion for years is retail. And so every other year maybe I go to the national retail federations. They call it the big events or the big conference in New York. It's overwhelming. It's like, you know, 100,000 people are there, but I just go from session to session to session to session. And I reconnect, by the way, with other executives in the sector that I've known just through my network. And I come away feeling caught up and feeling refreshed. And by the way, you know, which the CEOs don't always love, but you'll come away from those kind of things with a pick list of questions and topics where you want to say, hey, I haven't heard us talk about this. What's our perspective? What's our plan? Are we prepared? You know, how have we thought about this? That's great. Let's peel the curtain back a little bit for those folks that aren't in the boardroom today. How do big decisions get made and how much is consensus versus debate in the boardroom? I would rather have a board that actively debates decisions in the boardroom than a board that just all rubber stamps. In fact, I haven't been on a board that rubber stamps, so thank God. Hopefully there's not much of that goes on. I have, however, seen group think kind of creep in, and you have to be actively aware of that. I think particularly it's a particular risk for boards that have been together for a while. So I'm also a big fan of term limits. I'm a big fan of board refreshments. I'm a big fan of succession planning. So that you look at your skills matrix for your board and you really ensure that over time you're staying, staying relevant and contemporary. All of those things can help you not get into a situation where the board is just consensus driven. A lot of that does have to do as well, though, with the CEO's relationship with the board and what he or she views the board is there to do. And I talk sometimes about a spectrum that I see CEOs on. Kind of a journey from the board is a necessary evil. Somebody told me I had to have these people, Okay, I have them. They cost me a lot of money and a lot of pain every three or four months. But I'm going to do my best to kind of keep them in their box and, and I'll do my thing. That's kind of the. At the lower end of the maturity curve, right? And then you kind of go all the way over to CEOs who say, My board is a source of competitive advantage. You wish you had my board, you know, and I'm. I'm going to do everything I can to make sure we stay at that level. And I watched Nike, even from. From when I was first advising them all the way through to when I was there going through that evolution from a board that was early on, people Phil Knight knew personally, lawyers, investors, family members, to a board that includes Tim Cook, you know, that included the CFO of FedEx to lead the audit committee, where you're bringing people in very specifically who are titans of their field. And, you know, they will challenge you. And when you get that kind of board together. The discussion and the debate is going to happen organically because people are bringing their lived experience and their expertise to every decision. And that automatically means you're not going to start from the same point of view, which is great. And then if the board has a good culture of trust and openness and participation, what you end up doing is beating every side of an issue and really landing in a good place. Christiana, I love the notion of the board as a computer competitive advantage. And have you had that discussion in the boardroom on, you know, what's our aspiration? How are we a competitive advantage? Yes. Not as much as we probably should and not as many of the boards I've served on, but in one of them in particular, our board chair is very good. And we use the skills matrix and the succession planning to really look down the pipeline and say with the challenges we see ourselves facing, with the strategic imperatives that we've all agreed now that we want to fulfill, what kind of expertise do we need in this room going forward? And so as a company, for instance, and I've watched this now on two of the boards, as a company pivots and recognizes that technology, not just AI, but literally all kinds of transformational aspects of technology, is fundamentally changing the operating model of the company, then they need some people who really understand that intimately on the board. I got on my very first board because the it was a retailer and they were recognizing the rising impact of digital commerce on retail. No one knew and we still don't really know where's it going to land in terms of the mix. It's a dynamic situation, but they were from their heritage, store based all the way and they had a great culture in the stores and the CEO and everybody else understood how to run a physical enterprise. Their.com was underperforming and frankly, I don't think they even realized all the opportunities they were missing. So one of the acknowledgments they made was we need to bring that expertise on the board. And then that's why they brought me. I think boards have to stay on their toes to do that, to stay current in this environment as we continue down the path on decision making. Some CEOs complain that they have to reiterate to the board, first introduce an idea, then expand the idea, then the third board meeting actually get a decision. How have you seen the speed of decision making on your boards? And is there something that management does that makes it either easier or harder to make a decision quickly? Well, first of all, the Idea of sort of a three stage decision process isn't terrible. It doesn't have to take a long time. Right. I mean, we, when we're talking about M and A, for instance, we may have board calls every week and move in three, you know, period of three weeks, two, three weeks through those three phases of hey, here's an idea, hey, here's the more fully framed proposal. Hey, can you vote on it? Right. And I do think you need to give boards multiple bites at an Apple. When you're talking about a major decision, whether it's a large acquisition or it is a major change to a compensation policy, which I've been involved in recently, you are doing a disservice if the board does not have time to get all of their questions out on the table. That's what they're there for. Right? And they're bringing perspectives out. So I think it is a tension to make sure that you're getting the benefit of their perspectives. But you also can move quickly when the situation demands it. And where I've seen that work is the CEOs who are willing to do these kind of board calls and who give the board a heads up ahead of time. Because sometimes a lot of it is just saying, hey, I'm looking down the road. M and A is an example. There is a small set of companies that we're pretty interested in. We are in different discussions with each at every board meeting. I'm going to let you know where we are in those discussions. But if one of them heats up, we're going to have a call, right? And we're going to, you know, we may need to send you some information in between, et cetera. Then it didn't come out of the blue, right? Because I think the challenge for a board is if something comes out of the blue, not only is it that you haven't had a chance to kick it around and do your job, but also you're cautious about why didn't you tell us about this ahead of time? Right. Speaking of having the board have all the right preparation, we talked about board books. What information do you want from management on a regular basis and how would you like to consume it from a management information perspective? I think the challenge in communicating it to the board always is to say how do we share what matters and make it easy to follow it without overwhelming with things that don't matter. We as executives are looking at everything. We're turning over every pebble. The board is only engaging with this data at most monthly, more likely every Three months, Right? So for starters, you got to do a little bit of what I call, like, where we left our heroes, like, remind them, do some trending, etc. So I am a big fan of things like dashboards, trending and comparative examples. I'm the one that'll sit in the room and ask, what was this number last year? If they don't include it, right? Because I don't want to have to go back and go in the board portal and pull a book from a year ago. That's irritating. Why are you making us do that when that is vital to understanding that the number's up or down? I hate point estimate, like single numbers. What am I supposed to do with that? Right. There's no context around it. And if you put the burden on the board to remember all the context, to go back and find it, et cetera, you're kind of wasting the valuable time they've got, because what you really want them to do is understand everything you understand and then push you to go further. Right. So I like dashboards that are tied to both how value is created in the company and also what the strategic imperatives are. The best dashboards kind of incorporate that. Right. And some of it's qualitative as a result, because it's, are we on track with this customer or with whatever. I think trending is obviously, as I said, incredibly important. And then maybe it's McKinsey training. I am a big fan of showing the data, data visualization and showing the data in a graphic way. And nowadays you can do so many great ways of doing that. It really amazes me how many companies still just put a table of data out there, just put it out on a table and you're like, could you at least bold or they think they're really going crazy when they circle some stuff. Like, I just was going through a chart with somebody earlier this week and he had yellow circles and red circles, but no key to what the yellow and the red was. And it was feeding into a compensation plan decision we were making. I'm like, wait, let's back up here. What does red and yellow mean? Right. I don't want to actually spend my time on that stuff. I would much rather have them. Last time you saw it, it looked like this. Here's. So now, like, all the boards I'm on know the. When we last left are heroes for me because they know if. If you're going to sit down and have that conversation with the chair of the committee, you're going to say, last Time we talked, we talked about this. Here's the new information we're bringing. Is there anything else you need to know? What should we know? And then how do we get to a decision? Right. And when I do that prep as a committee chair, we have really good committee meetings as a result. Right. Because we're just moving right through all the good stuff and having a really good conversation that the team walks away going, oh, that was worth our time, too. Yeah. Actually, one of the things I recommend is not just where we left our heroes, but can you consistently put in the same pages on here was the strategy that we said we were pursuing. And then when topics come up, this is how it relates back so that it's not floating in the air that we are now bringing up something new. It's actually not new. It's embedded in what we said we were going to do. And now we're going deeper in that. Yes. That's where you want to say consistency is okay. Repetitiveness is okay. Actually, a little repetitiveness for a board goes a long way. I will tell you one other thing, or else I'll feel like I didn't. Didn't do justice to my thinking on the board. Books, appendices. Okay. It's also very challenging when you get a board book and the team is like, hey, you know, we really winnowed down what we're going to present. So it's like a tight 35 or 50, whatever, but I have 100 pages of appendix. Then I'm pretty sure there's stuff in the appendix that I need to read. Right. But I also wonder, why did you put it in the appendix then? If it's important, why didn't you put it in? It's a constant tension. And back to my spectrum of boards as a necessary evil to boards as competitive advantage. When I see big appendices with a lot of stuff in them, I feel like I'm a little more on the end of board as kind of a necessary burden. Because I'm pretty sure that there's something in that appendix that they know we probably need to have access to, but they don't really want to talk about. Right. And as an executive, I certainly had that temptation, which is like when I'm presenting to the board this slide, we don't need to talk about it, but we'll put it in there in case the board wants to talk about it. But then the burden's on them to say, well, wait, on appendix A13, you had something else. Right. If it's important, rip the band aid off, talk about it in the room, put it in the main deck, and make sure that you shine a light on it so you don't have to talk about it later when it gets worse. Right. In fact, maybe put it on the COVID page or executive summary as here are the couple things we want the board to discuss. What a discuss. I know, exactly. Yeah. All right. I know we are running short on time, so let me just switch gears. We talked about how boards come together. So family members, sometimes picked by the CEO. What about activist investors and when they send people onto the board and you know, what's been your experience with that? So, you know, it used to be you could go through a whole career of board service and never serve on a board with an activist. I think that's much less likely nowadays, frankly. And there are activists that are more active or less active, but your likelihood to run in into at least an investor who owns a significant share, who gets their way onto the board, it's much higher now. So I think the second board I was ever on, we had an activist investor, one of the co owners of the firm, a very large, prominent activist firm. And they had forced the company that I joined the board of to split off from its mother company as a result of the activism they did. And I joined right after all the chaos. So the company split. They created a new board for the new co, and that was the board that I joined. It took, I think, a lot of courage on the CEO's side to welcome that activist onto the board, because a lot of CEOs and boards will try to fend them off. They get into the proxy fights nowadays. Everybody gets to see everybody's candidates. Right. So it's kind of different. And you make the activists fight their way onto the board, if at all. And in this instance, she. The CEO's a woman. She invited, you know, the tiger right into the tent. And I would say the first couple of years were difficult because it very much feels like the activists, and very often they are coming in with a very focused agenda. They want to see profit improvement here. They want to see cuts cost here. They want to see a business spun off there that's undervalued. And they're just gonna keep hammering on that stuff. And it can dominate board discussions. You can find it's hard to get around to other topics that you need to get to. The other interesting thing that I found that I respected for activists is when this particular guy would come into the board meeting, he had his own board book because he had a whole firm of analysts that were running all the numbers before he came in. I found that incredibly valuable because the rest of us don't have that as individuals. But he really knew where the weak spots in the P and L and the balance sheet were. And he would be the best discussion partner in an incredibly annoying way on M and A and talking about premiums and what kind of value and how do we think about where it is? I learned so much from listening to him, but it was a little intimidating because he'd have like every chart that you could imagine, every number, like, you know, six business school cases worth of stuff that he'd have on the company. But over time, what happened and what you hope happens is that trust and kind of mutual alignment starts to build. And I'd say after two or three years, he backed and settled down a little bit in terms of the sense of like, I got my agenda, I got to get this stuff done because things had happened and were moving in the right direction. And frankly, he realized that the other directors weren't idiots and before he had gotten on the board, weren't steering the company in the totally wrong way. Right. So you start to build more of a cohesive group. And his voice is just one of the voices then versus just the loudest voice. And I think the next couple years of that were incredibly productive. And then his firm moved on to another very big proxy fight, two more very big proxy fight. And he had to step off the board because he didn't have time. And it kind of felt like we graduated a little bit that he stepped off, but we also missed him. We missed him because as abrasive as his voice was, sometimes those perspectives were pretty valuable. So I, you know, one of the things that, that I've brought to boardroom since then is asking that once a year we have an investment bank or someone else play that role for us. Look at the company from an activist investor point of view, tell us where we're vulnerable, tell us what we need to do differently, and actually take that kind of attacker mindset and bring it into the discussion. Really valuable. Yep. The other thing I've heard board members take away is to always have a value creation thesis, because that's one of the great things that the activists have. The beginning. So to do that and to say, do we still believe in our strategy and the value creators creation power behind it, or do we need to make adjustments? I agree. I think that they absolutely have their rubric that they're working against and they're not always wrong. You know, they're not always right, by the way, because the value creation part of it may numerically align, but there is a lot of the strategic and the growth side of the agenda that I find that activists are not always great at guiding. Right. All right, Christiana, as we think about wrapping up, what one piece of advice would you give to chairs and boards to do more of or less of? That's a great question, Celia. Let's see. I would say we haven't talked much about it, but I would actually focus on your decision to join a board and the CEO's decision to bring you or me onto a board. Give that more time, give that more scrutiny. Because once you sign onto a board, you're partnering with people for a while. I mean, you can always leave, right? You can get off the boat, get out of the boat. But it's not easy, it's not comfortable, and it may have repercussions. Right. And it's definitely not great for the rest of the board and the company if that happens. So you've got to go into it with a mindset that we are going to be successful together. And so doing your due diligence, whether you're the CEO or you're the prospective board member, and understanding the culture of the company, of course, their financial performance and their value drivers, but also meeting your other directors to say, can I spend hours in a room with these people regularly and feel like my voice will be heard and feel like I can listen and understand them and meet with some of the executives on the executive team to say, does the CEO have a good team? Are these people that respect the CEO? Does the CEO respect his or her team? And then finally, back to my spectrum point. How does the CEO view the board? And what is. What is he or she really trying to get out of that relationship? That's probably my advice would be more on the front end because this is a little bit like once you buy a house and you're, you know, that's your neighborhood, you can't move the house. You want to make this decision to the best of everybody's benefit. Christiana, thank you so much. It's been great chatting with you about your perspectives on board service. Thank you, Celia. Thanks to Christiana and Celia and to all of our listeners for joining us today. We hope you enjoyed the conversation and we welcome your feedback and ideas for future podcasts. You can reach us at itsrackinsey.com, which stands for inside the Strategy Room. We also encourage you to share your ratings and reviews on any podcast player, with many thanks to all who've already done so. We really appreciate the comments and feedback we receive every week and encourage you to keep them coming. And if you enjoyed this episode and you'd like to subscribe, you can easily follow our weekly series on any podcast player, where you can also access our entire library of more than 300 episodes. 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