It’s a subject that’s been going around Chief Information Officer circles for some time; Should Chief Information Officers be placed on company’s board of directors. The debate with CIO’s is that they are often technology experts and obviously senior managers but do they have the business savvy to be at the boardroom table?
Aside from CIOs, I think it’s high time we talked about it in another branch of the CxO family, the Chief Project Officer. Boards of Directors are charged with championing shareholder value. It is their primary function. The board must look both short term and long term. This exercise supersedes any operational of staffing concern. After all, this is the body that hires or fires the Chief Executive Officer. In some cases, the best decision for a board is to sell the organization or merge with another organization or even dissolve the organization all in the name of protecting shareholder value. Do not think that this is a backroom irrelevant body. Board members are held personally responsible for some actions of the organization and taking on being a board member is not a trivial decision.
There are many schools of thought as to how to constitute a board. Should it be made up of only external individuals who have no operational knowledge but who can make decisions with little or no emotional attachment? Should it be made up of people with intimate operational knowledge from the management team who can make highly informed decisions? Most boards include the CEO and the CFO as the actions of both of these people are critical to the board being effective. Sometimes the CFO will be a board member, sometimes an advisor with no voting power.
This brings us to the CPO. If you are an organization which has already established a Chief Project Officer post, you are in that CxO level where we can consider inviting such individuals to sit on the board. CPO’s often carry a unique combination of skills that span several disciplines. They must be capable of financial analysis, of managing risk, of structuring an organization to produce a particular result, of marrying business requirements with process and tool functionality. They must also have the skill to know when to end a project early and cut their losses. In short, many of the ideal skills required to be a contributing board member. Moreover, the CPO will often be responsible for the single largest spending of money and, depending on the organization the largest source of deliverable for generating revenue in the organization. If there is anyone in management who should be on the board, the CPO would be a likely candidate.
While there has not been a huge groundswell of movement in this direction, it’s fair to say that it’s probably on its way. The easy match of CPO skills to boardroom requirements will make this all but inevitable over the coming 10 years or so. Some of you CPOs may have already received such an invitation and are now weighing the implications for your own career.
What I think is perhaps much, much more interesting is to think of the impact on organizations in general over the coming 10 to 20 years or so as more and more CPO’s begin to sit in the boardroom and make the critical strategic business decisions that shape an organization.
Might we begin to see long term planning prior to buying an acquisition target? Might we expect standards such as charters for more than just projects? Might people have to account for their effectiveness and even justify their return on investment just like we do in portfolio management?
The movement of CPO’s into the boardroom is a healthy thing and, maybe even a necessary thing as we move into a new era of integrated management in the coming years. A CPO at the helm or even on the board at the helm can’t be anything but a positive influence.