Directors' powers are collective, not individual - they act as a board. If the board approves a director's actions, in advance or retrospectively, all is well. But if a director acts without board authority, he or she may be liable for breach of duty to the company and to third parties who suffer consequential loss. And, while the liability of the company may be limited, that of a director acting improperly is not.
Few new directors are prepared for the change from heading a function with substantial autonomy to a strategic role with collective responsibility. The IoD found that 92 per cent of directors get no training in directorship.
Research shows that a schism exists between most boards and the rest of the company. Most organisations have restructured in recent years and many are still doing so. A worrying survey by Professors Les Worrall and Gary L Cooper of the Manchester School of Management UMIST for the Institute of Management, The Quality of Working Life, found that most boards are unaware that their restructuring has had a devastating effect on employee morale, job security, motivation and loyalty.
Most directors say morale has improved as a result of restructuring. Most board members also say their company learns from its mistakes. However, senior managers disagree with them on all these issues, and as one descends the management hierarchy, opinions become more negative.
No training package will help boards become more effective, or close the gap between board and management. However, a new partnership of six organisations is offering a novel director development service. Core Solutions harnesses the skills and expertise of ex-company directors, consultants and development specialists. They know directors and senior managers learn best from experience and contact with people they trust and respond best to personal coaching. Consequently they offer bespoke solutions based in individual and team coaching. Core Solutions is the brainchild of Bell Scott, formerly the finance director of several companies.
"Each company, and the people in it, is unique," he says. "The improvements being sought will always be unique to the organisation and its staff. Whether it is the broader strategic issues, resolving a specific problem, or building effective alliances and relationships, we have some interesting, effective and fun means to help them achieve their aims."
Stephen Doughty was a consultant for 10 years to organisations facing change in the UK and abroad and has a Masters in Management Learning from Lancaster University Management School. He is most concerned with strategic planning and organisational change, top team development, and coaching in personal effectiveness and leadership.
"The boardroom is more a political than a management process," says Mr Doughty. "We have to learn a lot about the culture, where the organisation has come from, where it's at, and where it's going to go. Only when we understand the picture in a holistic sense can we offer solutions." He adds that "our basic philosophy is a minimalistic intervention approach in partnership with clients. They are involved in the analysis and solution - so they get ownership."
Core Solutions argues that trust is the basis of collaborative relationships, holds teams together, and lowers resistance to change. The company takes clients on outdoor expeditions. Paddling canoes on rivers helps develop team skills and driving Land Rovers while blindfolded develops trust in your guides. "Training tells you what to do. Coaching draws out processes and helps the individual discover what to do," says Mr Doughty. "Development is about creating opportunities for people to grow."
Core Solutions is based at the Glenmoriston Arms Hotel, Glenmoriston, Inverness-shire IV3 6YA; tel: 01320 351206.Reuse content