The ability to make decisions within the boardroom requires a combination of open discussion and strategic analysis, as well as leveraging technology. If executed properly these strategies can significantly improve a board’s decision-making capacity and result in long-term sustainability for the organization.
The first step is to collect all the information that is available and ensure that it is accurate, complete, credible, and in-depth. This is the management’s job and includes collecting information from both internal and external sources. It also involves conducting research and making sure that the board receives timely and comprehensive information.
After the data is collected The next step is to consider the possibilities of solutions to solve the issue. This can be a lengthy process, especially when trying to reach a consensus. Some boards employ techniques such as the Six Thinking Hats or Disney Planning Method to prevent groupthink and to allow a full range of alternatives to be considered.
Finally, the board must choose which option to consider. This is usually based on a range of factors that include cost and impact. Scope can also be measured by the number of affected people (e.g. employees or clients). It is helpful to have a framework of delegated authority that connects these criteria to the overall guidelines of the board for the organization.
After the decision is taken the board must clearly announce the decision in the minutes and detail the process by which it was reached. This should include a justification for the decision, a list with the options that were thought of, any advice sought and whether or not the criteria were fulfilled.