Tuesday, January 19, 2016

A Wise Board

A wise board accumulates rational wisdom, embraces unconventional wisdom and sharpens system wisdom.


Modern Board as a high-level governance body plays the crucial role in business advising, strategy oversight, operation monitoring, and setting key tones in corporate culture as well. Thus, a wise board is like a brighter light tower to guiding the business toward the right direction and take all these significant responsibilities more “thoughtfully.” So what kind of wisdom can you bring to the digital boardroom?

Rational Wisdom or Common Sense: Rational wisdom is the usual meaning of the term 'wisdom' - it means accumulative wisdom that grows with age - or 'learning from past experience.' It is an absolute advantage for many BoDs because many of them are seasoned executives with years of experience, also rational wisdom refers to business common sense, which will in most cases be determined by what defines you as an individual at a certain point, your experience and accumulated knowledge, the current context defined by its properties and interactions, the information and data at hand, your previous engagement with similar situations and your skills and capabilities to manage all of this into a structure. Common sense often uses intuition to make a decision faster, but always scrutinize assumptions and thinking thoroughly for critical decision making. Knowledge helps you figure out “HOW,” - the practices; and wisdom guides you through “WHY” - the principles. Wisdom has something to do with making a sound judgment in today's ever changing environment. This is particularly true for top level leaders like BoDs.


Creative + collective wisdom: Wisdom is not always proportional to age, just like the youth does not always imply to creativity. With the increasing speed of changes, continuous digital disruptions, and shortened knowledge life cycle, unconventional wisdom such as creative and collective wisdom are abundant and invaluable at digital age because the world becomes hyperconnected, the talent people can share insight, co-create new knowledge and co-solve common challenges more seamlessly. With today's complexity, ambiguity and interdependence of business dynamic, the collective wisdom via bridging the cognitive and experience gaps becomes more crucial to breaking down the group thinking or outdated conventional wisdom. Therefore, boardroom inclusiveness, mainly about the diversity of thought and color of viewpoint, helps to build a mindful board with unconventional wisdom. There are some excellent directors out there who exhibit the courage to challenge assumptions or present alternative viewpoints, so once you know who they are; it’s great to follow their footprint. The wisdom/qualities/skills/ experience and mindset are needed in order for the BoD role to be executed in a high-performance manner. From a governance perspective, the complementary mindsets and skills will help identify management blind-spots and capture collective insight.


Systematic wisdom: Systems thinking is a discipline for seeing wholes. It is a framework for seeing interrelationships rather than isolated things, for seeing patterns of change rather than static “snapshots.” ST wisdom is not derived from 'accumulating' - but in observing the changing context of relationships - and in many cases, that means 'letting go of accumulated traditional wisdom,' or past learning. Because what seems to make sense in one circumstance might not work so well in another situation. The reason people are struggling for ST wisdom because it means that one has to make a huge effort to get beyond rational linear thinking. Because true wisdom is transcendental knowledge which often comes through nonlinear thinking and abstract of insight by practicing systems thinking or out-of-box thinking. Unlearning is difficult. And the difficulty grows exponentially with age. So ST wisdom is more difficult to acquire with age. But it is learnable and valuable. Systemic thinking is about thinking of your common sense and verify it, how it becomes influenced by the above and how you could change your approaches towards the desired transformation of the system. It is about developing further your common sense and fine tuning it.

A wise and effective Board exhibits a creative tension, that hard to define, but you know it when you see it. There is a balancing act between collegiality and challenge, conventional wisdom and Systems thinking. A wise board accumulates rational wisdom, embraces unconventional wisdom and continuous sharpen system wisdom.

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