Friday, April 8, 2011

That kind of a week…

I’ve been scarce all week – just an overwhelming amount of work that filled each day.  The calendar didn’t predict it, I had three days open on Monday.  But one meeting ran long, another got tipped to the next day, another split to consume two days, and that was the way of things.  Fortunately my birthday rolled around today, but I was so frazzled that the best remedy was, literally, a few hours in the nature reserve near Fowlmere.

And, for the many birthday greetings, many thanks!  It really made my day.

I think that the dominant lesson this week was ‘leadership’.  The company is adopting new Articles and Directors next week, which means forcibly setting aside the old ones.  This, in turn, requires the assent of the current Director / Founders.  Since most have been only minimally involved with the Company for years, I expected this to be a courtesy call – “Hi, remember us, we’re doing great, your shares have prospered, we’re moving to the next phase, please sign your consent here.”

Not so.

Money in the Company implies money; the document means leverage.  I’ve observed before that no business deal closes until the participants migrate through all seven of the Deadly Sins, and it is true again.

  • I made arrangements for each Founder to have Observer status on the Board, a right to attend meetings, stay informed, and participate in discussions.  Not enough – all want to remain Directors, even though it requires 10 meetings per year.
  • People had ‘in name only’ titles, legacies of their early days with the company.  Each now wants an equivalently meaningful non-executive title, enshrined in the Articles.
  • And surely there are Director’s fees and expenses now that there is cash in the bank?

So, the idea that people spontaneously align in their best interest as shareholders gave way to self-interested alignment with their worst impulses.

I think that this is where the leadership has to start.  There are decisions about allocation of resources, scarce cash and time, that have to be taken.  The project needs support; investors are watching.  By mid-week, it was clear that my consensual style was encouraging bad behavior rather than getting the Company moving into it’s next phase.

I simply needed to declare how things would lay out, keep it simple and follow best practices. Then listen to the objections: if they made sense, take them in, but keep things moving to a firm close.

DSC03510For example: Director appointments need to sunset; I want terms limited to three years. But, in the UK, Director’s must be re-appointed unless voted out. Okay, we’ll do that at the annual meeting.  Sorry, UK law abolished annual meetings, so we’d have to call an extraordinary session.  There is no way to sunset a director except by voting them out. Okay, strike the term limits.

There are twenty issues like this, but we’re licking them one by one.

A year older; a year wiser.  ‘About so many things.

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