The article uses examples from NASA (HST), Volkswagen, and Wirecard to illustrate how boards are prone to miss early warning signs of danger. The article stresses the importance of identifying early warning signs and taking action on them. This can be accomplished through a well-run review procedure for boards that helps them evaluate their performance and effectiveness.
The authors stress the necessity for boards to examine their own performance as well as the performance of the of the company, in order to discover gaps and opportunities to improve. In addition, they stress the importance of using the expertise of consultants outside to ensure that the agenda for the board is comprehensive.
A board room review is an evaluation of the effectiveness of the board of directors when compared to the ideal requirements for the business. It could be an ongoing internal review that uses a cheap world-class benchmarked survey tool like those from Board Surveys or a more distinctive external evaluation that is tailored to the requirements of the organisation.
It is essential that the boardroom be an area where members are able to be honest and open. They must be able to focus on their task without being distracted or interrupted, and should feel at ease discussing sensitive subjects. A conference room with large trestle tables and chairs, a soundproofed environment to keep conversations private, and the latest technology like Bloomberg plug-ins and state-of-the-art quote systems can aid. Virtual meeting rooms allow members to take part in meetings at their offices, at home or even on an airplane. This helps to make the process easier.