Reid’s Rituals of Great Boards: the 8 strategic tools used by top companies

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Reid’s Rituals of Great Boards: the 8 strategic tools used by top companies

Reid’s Rituals of Great Boards: The 8 strategic tools used by top companies
Reid’s Rituals of Great Boards: The 8 strategic tools used by top companies

What I've learned from over 1,000 board meetings at the best boards in the world, including Microsoft, Airbnb, LinkedIn, PayPal, Coda, Zynga, Convoy, Aurora, and more.

What I've learned from over 1,000 board meetings at the best boards in the world, including Microsoft, Airbnb, LinkedIn, PayPal, Coda, Zynga, Convoy, Aurora, and more.

Over the course of my career, I’ve had a deep and wide-ranging experience serving on boards. I’ve been in the executive seat on the boards of my own startups, LinkedIn and SocialNet. In the early days of PayPal, I took the uncommon step of switching from the board to an executive role at the company. I’ve served on the boards of private companies (Coda, Neeva, Convoy, etc.), served on the boards of companies as they went public (LinkedIn, Zynga, and in process Aurora), and joined boards as part of a SPAC process (Joby). And I’ve even joined the board of a perennial Fortune 20 company well into its existence (Microsoft).

Across the dozens of boards I’ve served over the last 20-plus years, I have now attended over a thousand board meetings. And I can see clearly what separates the best, most effective boards — and board meetings — from the rest.

For any CEO who wants to cultivate an extraordinary and effective board, two things are key:

Recognize that your board is different from every other team you lead.

Adopt specific rituals that support this unique team in driving great results.

Understand this: Boards are a different kind of team

One constant in my experience is that Boards of Directors are unusual organizations. At their most effective, they function as highly-aligned and fast-moving teams. And yet they’re contextually different from most teams that form inside companies. Board members meet infrequently, spend their days in distinct environments, and have somewhat ambiguous responsibilities. Because of this, it’s often an uphill battle to bring a board together as a truly effective team.

Typical internal employee team

You probably spend a lot of time together, often in informal settings.

You’re all immersed in the same company culture.

You possess the familiarity, knowledge, and trust that grows out of routine engagement over time.

You should be working under the direction of clear executive leadership, from the CEO and on down.

You should have clear goals and measures of those goals — i.e. you understand objectively if you are doing your job well.

A board of directors

Meets just four times a year typically, although there are reasons why early-stage companies can meet up to 10 times per year.

Has members who spend their days in distinct environments — and are sometimes even competitive with each other.

Manages itself by a group process (not top-down) even if some board members might have some specific powers in specific companies. A board chair generally is not the “CEO” of a board, except sometimes by moral authority or general agreement.

Has the central responsibility of hiring, firing, and compensating the company’s CEO. The board also participates in major financial decisions that have a macro effect on the entire company, such as purchasing other companies or major assets. Both responsibilities take years (or decades) to play out and are challenging to link directly to revenue or growth numbers. As such, the question and measurement of whether a board is doing a good job can be murky.

All of these factors can result in discussions that are less forthright than desired, or even discussions that can feel non-inclusive and superficial.

Outside the context of the board, board members are often CEOs or other kinds of leaders, used to setting agendas and having the final say. But on the board, they must work together as a team. With only a limited amount of time to make decisions that will likely have major impact on a company’s short-term and long-term directions, strategies, and success, board members must possess a highly-aligned sense of purpose and a common understanding of the rules of engagement.

So how do you help them achieve this necessary alignment of goals and processes outside the usual contexts that facilitate effective team-building and teamwork within an organization?

You achieve this by integrating rituals that support the cohesion and focus of the group.

8 Rituals: Best practices from the best boards

On my podcast, Masters of Scale, I had a

fun and illuminating conversation⁠

with Coda CEO Shishir Mehrotra about the rituals that great companies use to build enduring world-class businesses.

In Shishir’s conception, rituals are the key processes that both determine how companies communicate and simultaneously help embody its values and culture. They’re the secret sauce that give employees a common frame of reference and shared identity. As I’ve watched Shishir develop a series around

rituals⁠

, I realized their importance in board meetings. Explicitly incorporating shared processes is a powerful way to help board members quickly achieve the collective sense of purpose and corporate fluency that are the hallmarks of great workplace teams.

There are a number of essential practices for high-functioning boards. These include recruiting the right board members, understanding the OKRs for board members and the board itself, building the right partnerships with the CEO and company, knowing the right ways to add value and to avoid destroying value. Detailing all of these is a book in itself. However, from my general experience and from watching Shishir deploy his rituals in the Coda board meetings, I realized you can distill some of these rituals into helpful tools.

With that in mind, I’ve created this list of eight rituals drawn from the playbooks of Airbnb, LinkedIn, Aurora, Coda, and others that can help board members operate at peak capacity.

⁠

Dory and Pulse⁠

(inspired by Coda). Capture unbiased feedback and vote on discussion topics.

⁠

Fundraising⁠

(inspired by LinkedIn). Find the right investors, nail the pitch, and evaluate offers.

⁠

$100 Prioritization⁠

(inspired by Aurora). Provide input on priorities without breaking the company.

⁠

Hiring Execs⁠

(inspired by Kiva). Hire executives with cofounder mindsets.

1:1 Meetings⁠

(inspired by Zynga). Use 1:1 meetings to deepen relationships between board members.

⁠

SWOT⁠

(inspired by Aurora). Tap into the board’s experience and unique POV to navigate uncertainty.

⁠

Board Assists⁠

(inspired by TripActions). Leverage your board’s social influence to sell and hire.

⁠

11-Star Experience⁠

(inspired by Airbnb). Imagine the most expansive blue-sky, 11-star version of a strategic direction. It’s an invitation to think big.

Each of these rituals helps your board unlock growth in different ways. Want to get unbiased feedback during board meetings? Use a

Dory and Pulse⁠

. Need help closing a candidate or selling a big account? Ask your board for

Board Assists⁠

. Hoping to get your board’s input on planning? Try the

$100 Prioritization⁠

exercise.

Introducing these rituals to your board may seem unnatural — after all they are a “different kind of team” and may have a higher-than-average fear of the unknown. There are smart people who may view the addition of these rituals into board meetings as a distraction rather than progress. But often what a board needs is to break the normal patterns and try something a bit different. So introduce these rituals thoughtfully — start with your most open board members and craft your plan. And of course, you can send them this doc as a (hopefully) helpful backgrounder.

Note that these rituals all assume you’re getting the basics right — ensuring your board meetings have a clear agenda, easy way to get to the “staples” (financials, people updates, etc). If you’re looking for a place to start, I recommend

Two-way writeups⁠

and Shishir’s board

template⁠

⁠

You don’t have to wait until your company is as large as Microsoft or as ubiquitous as Airbnb to create a world-class board of directors. Start today by copying this doc. Then go implement your own board rituals.

⁠

Copy this doc

⁠

If you would like to try this technique and need help implementing it, the Coda team has graciously offered to help.

Click this button to get assistance:

⁠

Connect with a Rituals Architect

⁠

Thanks to the following for their help and feedback: Justin Hales, Elad Gil, Brad Feld, June Cohen, Selina Tobaccowala, David Sze, Chris Tsakalakis, Nick Mehta, Raechel Timme, Mads Johnsen, Fred Wilson, Mark Pincus, Jenny Emick, Chris Urmson, and Ian Alas.

⁠

Ready to create a legendary board? Start with a
`Dory and Pulse`⁠
.

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Reid’s Rituals of Great Boards: The 8 strategic tools used by top companiesReid’s Rituals of Great Boards: The 8 strategic tools used by top companies

Understand this: Boards are a different kind of team

8 Rituals: Best practices from the best boards

Ready to create a legendary board? Start with a Dory and Pulse⁠.

Reid’s Rituals of Great Boards: The 8 strategic tools used by top companies
Reid’s Rituals of Great Boards: The 8 strategic tools used by top companies

Ready to create a legendary board? Start with a
`Dory and Pulse`⁠
.