Non-executive directors: Getting the right guru on board

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The reasons for, and challenges of, finding the right NED to join your organisation

Time for an advisor?

When senior management is tackling the company’s growth and development, objective guidance from key advisors is a vital asset in steering the process. It’s not unusual for larger organisations to appoint a consultant for this purpose – usually a non-executive director (NED).

HR directors must consider that the wrong fit of NED in the organisation could be disastrous, with negative impact on brand and growth. The search process requires extensive research, tapping into a network of referrals and recommendations, having a thorough understanding of your organisation’s needs, culture and growth aspirations. On the counter-side, you’ve got to approach and negotiate with a candidate with an understanding of their motivations, backed up with solid data.

Individuals at the peak of their game may not be considering a career change and are likely to be very valued where they are. This does not preclude making an approach, if it’s the right one.

Motivation and persuasion

Motivation is not just about a good reward package; a desire to explore one’s professional diversity through experiences, sectors or locations count too. Work/life balance has become a key bargaining chip for those people who have attained a certain level in their career.

Some NED candidates may want to work for an established company, others a younger, emerging organisation, maybe even a non-profit. Communicating an offer to someone at the peak of their career must be undertaken with consideration, discretion and mutual respect for all parties involved. This is especially relevant if the candidate being approached is already employed by a competitor, which is not that unusual.

SMEs – don’t be left out

For those SMEs that are at a crossroads in their growth, where the next large jump is crucial but unchartered territory for a small team, then it’s time to consider hiring an NED. It can be fatal to make these decisions while being too introspective.

Be sure about what you want to accomplish for your company as it informs your expectations, what you can offer and the characteristics of the role you’re offering.

For smaller companies, investment in a permanent top-level advisor may be too steep financially. However, professional recruiters can help find someone according to your and their needs; for example: an advisor who is prepared to work part-time, a few days per month. You’d still receive the same quality of expertise but with less financial outlay.

Alternatively, engage a senior advisor, with all the skills and expertise you need but on a short-term basis. Make this an interim arrangement until you're ready to recruit a permanent post-holder. For some senior managers and directors this role is appealing and refreshing; they can share their experience without the commitment of being ‘permanent staff’, removed from the internal company politics. They may enjoy being an ‘external’ coach or mentor for younger staff members, which is a bonus, especially for unseasoned, smaller companies.

Companies wanting to refine and grow might consider the following:

  • Have clear targets
  • Understand what kind of business you want to be. Customer focused? Cost? Sales? Operation led? Decide what your thrust is then everyone in the business from top to bottom must embrace it
  • Be clear about strategy – be rigid about performance and where it’s weak, change it.

Hiring a top level NED offers substantial return on investment as you are getting a wealth of expertise on all the above for less than CEO salary.

The most important consideration is chemistry. Picking an advisor that fits with the company culture and people, who is open enough to understand and embrace them, makes a significant difference in the success rate of the partnership. This applies not only to what strategic advice is given, but how it is likely to be received.

A dedicated NED can be brutally direct in picking out the areas that need rethinking and revising. It’s easier to accept the honest and tough critique from someone who understands what goals you are trying to achieve. With mutual interest and respect for each other, an employer and their NED can make, rather than break their company’s future.

James Metzger is co-founder of Metzger Search and Selection

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