Herb Rubenstein Consulting is taking a strong stand that the legal profession could benefit greatly from having lawyers learn more about the recent developments over the past 30 years in the field of leadership. Currently, with one exception in Cincinnati, there are no courses taught in law school or for continuing legal education credit on leadership development. Herb Rubenstein will be a luncheon speaker on the topic of "Teaching Leadership to Lawyers: Challenges and Promise," on August 3rd, 2004 at the Association for Continuing Legal Education's Annual Conference in Denver, Colorado. Herb Rubenstein Consulting has opened exploratory talks the Larry Center, Director of the Georgetown University Law Center's Continuing Legal Education Program, regarding developing a continuing legal education course on leadership development for lawyers that would be taught throughout the United States. Herb Rubenstein received his law degree from Georgetown University. Herb Rubenstein Consulting is in the process of developing a two-day training course on leadership to be taught to lawyers starting in the fall of 2004.

Herb Rubenstein Consulting's two articles this month focus on boards of directors. We raise new questions like, "What should be the IT Access by board members to company and nonprofit organization data?" and we address old concerns like the role of marketing by members of boards of directors. We still believe that most boards of directors under-perform, to put it mildly. We hope our short articles provide guidance and assistance to all of the boards of directors where you are a member or where you consult.

Copies of the articles that we have written are available from herb@herbrubenstein.com and our website: www.growth-strategies.com. Feel free to share them. Take care and enjoy the summer.

ARTICLE

IT Access for Members of Boards of Directors

Article by Herb Rubenstein
President and Founder, Herb Rubenstein Consulting

Introduction

In the 1980's, when Casper Weinberger was Secretary of Defense, he was a "power user" of information technology. In fact, he bought his wife an early model of the IBM desktop PC. While serving as Secretary of Defense, he wanted to be able to put his appointments and meetings into his computerized "calendar." Soon after this started doing this, legend has it that Defense department officials learned that Secretary Weinberger would accept speaking invitations to the Rotary Club and other organizations and put them into this calendar with great regularity. Often these speaking engagements and meetings that Secretary Weinberger set up himself and put into his electronic calendar would conflict with other business and meetings of the Defense department.

The Defense department's solution was simple. It took away Cap Weinberger's "access privileges" to input data (appointments and meetings) into his official electronic appointment calendar. The Defense department took control of his calendar, putting in each and every entry. Every morning around 6:00am, the department would give Secretary Weinberger's driver his schedule for the day on an index card. The driver would pick up Secretary Weinberger and give it to him.

While such a story seems almost ludicrous today, almost 30 years later, most independent board members of organizations (both for-profit companies and nonprofit organizations) do not have any IT access to the company or organization's data bases, virtual private network, intranet, company documents and financial information or any of the vast amounts of information contained on the computers of the organization. This article addresses the need to change this lack of access that board members have to information vital to doing their jobs as members of the board of directors of businesses and nonprofits.

New Developments

New software is being developed to address the expanded duties of members of Boards of Directors. Such software as Hyperoffice, Director's Desk, The Board Institute's new software for board self-assessment, and BoardVantage all address some aspects of a board member's role. Clearly, software can be used to help organize online voting, assignment and tracking of tasks, control of email, scheduling, whiteboarding (collective editing of a document), storing and sharing of necessary documents in some type of portal, provide chatrooms on key issues and other key board matters. However, even new developments in software for board members do not adequately address the key point raised in this article: lack of access by board members to the IT systems and the data contained in those systems by the organizations that the Board is supposed to govern.

Based on information provided to this author by Peter Maher, Chairman of the Board of a New Jersey Boys and Girls Club, the national Boys and Girls Clubs of America, has created an intranet, www.bgca.net, that allows its 32,000 board members nationwide in 3,000 Clubs, access to a great amount of information stored by the Boys and Girls Clubs of America. While there is more work for the Boys and Girls Clubs to do to make all of the organization's information available to its board members that is necessary to support them in being fully informed in making decisions, it is clear that this organization is making strides toward giving its 32,000 board members all across the nation at least some access to IT based data.

Limitations in even this advance system do exist. For example, if I were the Chairman of Finance/Audit Committee of a Boys and Girls Club, (and I used to be Chairman of the Board of Directors of the Jeleff Boys and Girls Club in Washington, D.C.), I could not get access to the general ledger of my Club through this system, even in a "read-only" mode. The only way I would have access to the financial information of the local Boys and Girls Clubs where I served on the finance committee would be to attend the monthly board meeting where senior management would give me a paper version of a monthly financial report.

The question, today, then is not whether to give board members IT access to significant data held in the IT systems of the organizations they govern. The question, today, is "What level of IT access should be provided to board members?" While it is true that every board member might not need all of the access that other board members might need (since members of the finance/audit committee might not need access to all of the human resource information that is needed by the nominating and compensation committee members), this article stands for the proposition that each board member needs significant access to the company or nonprofit organization's data and documents contained in the organization's IT system.

From our research, we have not found one organization or board of directors that has articulated a robust, comprehensive policy on IT access for board members. Using the words "IT Access for board members" in GoogleT on July 14, 2004 revealed only one hit and the phrase "IT Access for members of boards of directors" yielded no hits whatsoever on GoogleT. This must change.

From Here to There

Currently, most members of boards of directors gain their information about the organization they govern by reviewing documents, data and reports prepared for them by senior management. This is a "push" form of information sharing. It is not information in "real time," or "on demand" and it limits board members to reviewing what senior management wants them to review in a form that senior management wants to show to the board.

The "Board Book," the archaic paper and plastic notebinder, represents the current state of the art in giving members of boards of directors access to information about the organization that senior management thinks the board needs in order to make its decisions. Having the senior management of the organization be the gatekeeper of all information that flows to the board of directors represents a key stranglehold that senior management currently has on board members.

Electronic board books, using web based portal technology and shared document systems, represent a simple, but very useful improvement in the use of IT to inform board members. However, board members need to be able to have much greater access to company or nonprofit organization generated information that resides on the organization's IT system, than any board book, electronic or not, can currently provide. Each board member needs to be able to log in to the organization's IT system, access relevant data and documents and find answers to key questions without having to go through senior management to get the answer.

Outside board members, whose computers lie outside the company or nonprofit organization's firewall, need a special entry path into the organization's IT system. While security is always a concern, companies like YASH Technologies, Tivoli/IBM and Cisco, and many others, all have simple solutions to the security concerns raised by giving independent board members access to an organization's IT system.

Certainly there will be limits as to what board members should be allowed to see. Board members of Coca Cola®, for example, should not have access to the secret Coca Cola® formula or other highly sensitive documents of the company. But, IT access for board members should be very broad rather than limited, even in the beginning, in order to give board member access to the information they need to make excellent decisions, create successful strategies, be accountable for all financial data generated by the organization, and, ultimately, govern organizations.

Conclusion

New mandates for board members are being generated by Sarbanes-Oxley and new litigation that is rewriting the rules on board duties and responsibilities. Therefore, board members need new and unfettered levels of access to information of the organizations where they serve as board members. Each board must develop its own policies and protocols and develop the IT infrastructure and security apparatus to enable board members to access key organizational data in the organization's IT system. And this must be done without compromising the security of the organization's IT system.

The days when members of boards of directors only get the information that senior management wants to give them and in the form that senior management wants to present it to them are over. Even today, Casper Weinberger, now Chairman of Forbes, is probably allowed to enter his own appointments into his computerized calendar. However, the independent board members of Forbes and most other companies and nonprofits probably have limited, if any, access to the data and documents in the IT systems of the organizations where they serve as board members. It is time for a change.

ARTICLE

The Role of Marketing by Boards of Directors

Article by Herb Rubenstein
President and Founder, Herb Rubenstein Consulting and
Kelly O'Brien
President, TurningPointe Marketing, Inc

Introduction

In June 2004, Business Week reported that a member of the Board of Directors of Coca-Cola squashed a major advertising campaign that the company was considering. The magazine then reported that the Coca-Cola Board of Directors lacked the marketing expertise that the company needed. In a separate meeting, also in June, 2004, a Chairman of the Board of a $100m a year organization, looked out at the Board and remarked, "We don't have anyone on the Board with any marketing expertise."

These two separate incidents, within days of each other, represent a set of soft signals beginning to permeate the business and nonprofit landscape. Boards of Directors are now beginning to look beyond being the financial cops required by Sarbanes-Oxley and starting to focus on what has always been an essential role of Board of Directors -helping make the business or nonprofit grow. This article is designed for organizations looking to see how their Board of Directors or Board of Advisors can begin to play a pivotal role in helping with the huge marketing challenges that businesses and nonprofit organizations face today.

The Board's Role in Marketing

As one of the authors of this article has written in a separate article, there are very few published standards for boards of directors. A recent GoogleTM search revealed only 50 hits using the phrase "Board of Directors Marketing Committee." What is clear from the work we have done with Boards of Directors is that if your Board is going to be active in helping your organization market its services and products, then there must either be a Board Committee or an individual on the Board who has marketing expertise and who is willing to take responsibility for leading the Board in a new effort to help promote the business or nonprofit.

We believe the Board's role in marketing is threefold. First, the Board must insure that the organization has a strong marketing plan and budget to meet its growth goals. Second, the Board should be active in recommending new customer segments, introduce the organization to potential customers and give the organization a hand in promoting the organization with speeches, articles and other PR and marketing activities. Third, the Board must insure that the organization has either internal resources or outsourced assistance necessary to implement a solid marketing plan.

Formalizing this role on the Board of Directors may be adding something to the Board's plate that it is not currently capable of handling. Having marketing expertise on the Board is an essential component of being able for a Board to make good on its commitment to be an important part of the marketing success of the organization. At meetings, in addition to having the CEO, CFO, CIO and other key officers report to the Board, the person in the organization responsible for marketing should also report regularly to the Board of Directors.

Transforming the Organization

We recently completed a business plan for a nonprofit that has annual revenues in the $3m range. There is no one on staff whose job description includes sales or marketing. There is no one on the Board of Directors with an expertise in marketing. At a recent Board meeting, also in June, 2004, one Board member suggested going after a new target group and offered his assistance in helping forge the strategic alliances and making the contacts necessary for this new marketing foray become a great success.

Although this Board member was not on the Marketing Committee of the Board (since it did not exist) and although he did not have any marketing expertise, (he is a lawyer), his suggestions at the meeting were a perfect example of how a Board of Directors should play an essential role in helping the organization go about marketing its products and services.

In this situation, the Board member was so far ahead of the organization in his thinking, the organization will need either to create a new position in the organization for "marketing" or allocate "marketing" duties formally to a person who is currently doing another job in the organization. The Board member's marketing suggestions and leadership on this marketing idea will transform the organization. It will lead to a new emphasis on marketing in the organization, will direct the organization to begin to spend more resources on marketing and will lead to the creation of marketing capacity that the organization has never had during its ten years of existence.

The Five Steps

There are five steps to getting your Board of Directors or Board of Advisors involved in helping shape and participate in the marketing of your organization. First, if you do not have an active Board of Directors or Board of Advisors, you must recruit one and call a meeting. Be sure that someone on the Board has sufficient expertise in the field of marketing. At this meeting, marketing should be one of the first orders of business.

The second step is to form a Marketing Committee at the Board level or at least obtain an agreement from one person to serve in the capacity of Board member responsible for marketing.

The third step is to begin or accelerate the process of creating a marketing plan for your business or nonprofit, regardless of how small or large it is. The Board should have input into the marketing plan and should approve it. Then the Board will understand what the organization needs to do in the marketing arena and will assist in making those activities take place successfully.

The fourth step is to keep track of your marketing successes and failures. Whether your organization will buy ad space, write articles, give speeches, sponsor events, expand its website, create and distribute a paper brochure, give seminars, attend conferences and trade shows, hire marketing consultants, enter into marketing strategic alliances or partnerships, join networking groups, hire sales and marketing personnel, buy lists of potential customers and contact them, distribute electronic or paper newsletters, or undertake other marketing activities, a "scorecard" approach should be developed and all marketing activities, successes and failures should be reported to the Board at each Board meeting.

The fifth step is to plan for how to keep Marketing on the agenda in your organization for the long haul. Will you hire a dedicated marketing professional? Will the CEO continue to also be the Chief Marketing Officer, realistically with support from strong implementers? Hand-in-hand with institutionalizing your approach to marketing is keeping an eye on the quality of your results. A true measure of your success isn't necessarily that you get more business, but better business. You'll need to regularly monitor the quality of the new work your efforts bring in, and make decisions about what new work to accept (as well as which clients or products to "retire"). The key is to maintain a high-quality portfolio that furthers your organization's objectives.

Expected Results from Increasing the Board Role in Marketing

The first result we expect will occur when an organization adds marketing as an official part of a Board of Directors or Board of Advisors' plate is that there will be an immediate increase in the amount of advice the organization will receive on how to market. Everyone loves to give marketing advice. Second, we expect that if these suggestions by Board members are not followed up in the very near term, the Board will not continue to play this role since they will not see that their input has been valued. Third, we expect that whatever marketing plan your organization now has in place, by adding Board involvement, this plan will be improved quickly and the organization's entire approach to marketing will be transformed.

For Businesses and Non-Profit Organizations Without Boards of Directors

The reality is that most small companies and nonprofits do not have functioning Boards of Directors or Boards of Advisors. This article strongly suggests that if your organization has $100,000 or more in annual revenues, your organization should have either a Board of Directors or Board of Advisors.

Using the marketing subject as one of the first areas where you would be asking help from a newly constituted (or reconstituted) Board of Directors or Board of Advisors is a great opening project for a new Board. It has little risk for a Board and can lead to quick and sustaining marketing leads and marketing plans for the organization. Board members could be compensated, either as a group or individually, for marketing leads and for suggestions that lead to expanding the revenues of the organization (although this might be prohibited in some nonprofits and must be carefully orchestrated to avoid conflict of interest pitfalls).

Conclusion

In three separate Board meetings in June, 2004, marketing aspects came to the forefront of a Board's attention. We think this is no accident and signals a period ahead where an organization's Board of Directors or Board of Advisors working to help the organization with its marketing can and should make a huge difference in the marketing success and growth of the organization.

Biographical Information

Herb Rubenstein is an attorney and the CEO of Herb Rubenstein Consulting, a leadership and management consulting firm. He is co-author of Breakthrough, Inc. – High Growth Strategies for Entrepreneurial Organizations (Prentice Hall/Financial Times, 1999). His email address is herb@herbrubenstein.com and he can be reached at (301) 718-4200 in Bethesda, Maryland or (202) 236-7626 in Washington, D.C.

Kelly O'Brien is the founder and President of TurningPointe Marketing, Inc., a small company dedicated to helping professional service firms attract more clients by making them smarter, more strategic marketers. Kelly sits on the Board of Directors of the United Professional Sales Association and Chairs UPSA's Marketing Committee. As CEO of a high-tech start-up, Kelly was named Social Entrepreneur finalist in Fast Company magazine's "Fast 50" awards. She was also a program director and educator at Georgetown University's School for Professional Development. Kelly has written numerous articles on marketing, and has been profiled in the Wall Street Journal, Fast Company Magazine, CBS News, Washington Business Journal, Women's Business Journal, and Training Magazine, among others. She has an MA from George Washington University and a BA from Dickinson College, Carlisle, PA.

Ms. O'Brien is a life-long ballet dancer and Francophile, thus the intentional "e" at the end of TurningPointeT. She's based in Washington, DC and can be reached at kelly@turningpointemarketing.com or (240) 460-8113.