Earlier this month, I worked on an international deal that was very complex. The board was comprised of members from different countries who spoke different languages and had different visions for the company. Managing a board of directors is always challenging, but this level of complexity was new to even me. It’s a scenario I’m sure to use next spring quarter during my second stint teaching about The CEO and Board Leadership at the University of Washington’s Foster School of Business.
Sadly, my first semester as a visiting Adjunct Professor at the University of Washington’s MBA program has come to an end. I had the honor of co-teaching this course with a successful Seattle-area executive, Neil McReynolds. After 17 years, this was his last year teaching the class, and we were able to celebrate and honor his of service to the Foster School of Business during the last month of the class. I am sad to see Neil move on to new adventures. He was a great teacher for this class, as he serves on many boards, both for-profit and non-profit, and has a successful consulting practice working with various Board of Directors. He even began his career as a journalist. His wisdom and experience were extremely valuable, and he set the bar high for any teacher. Fortunately, the UW invited me back next school year to step into his shoes. I’m looking forward to interacting with a whole new group of students and welcoming a new co-teacher.
You can read about the first half of the course here. We’ve been privileged to have some of the very best business leaders in the country speak to the students about real case studies involving CEOs and boards. I wanted to share some of the highlights from the second half of the class, as we all learned quite a bit from a new set of industry leaders.
Chet Kappor was the CEO of Apigee. After taking the company public, it was bought by Google and is now a key component of the Google Cloud strategy. He spoke to the class about best practices when hiring and firing a CEO, because it’s not as simple as it sounds. The board needs to be reasonable and avoid creating a caustic situation. Sometimes, the CEO can step down and find another role within the company, such as spokesperson, or perhaps the board can help find a more suitable role with another company. The goal is to facilitate a smooth transition, not only with the new CEO but also with the employees of the company who may see the change as a threat to job security and company stability. The rule of thumb is to treat the outgoing CEO fairly and make the situation as positive for everyone as possible.
Craig Conway is a tech industry legend. He’s the former CEO of Peoplesoft, which was sold to Oracle. Craig now serves on several boards, including Salesforce and as the Chairman of Guidewire, where I previously served as a board member. Craig presented a thorough and detailed discussion about the roles of each board member. From Chairman of the board to heads of committees, such as audit, compensation and corporate governance. He also spoke about the four basic board member duties: duty of care, duty of loyalty, duty of candor and duty of confidentiality, which people don’t often hear about. These are the underpinnings of the whole board process and responsibilities.
Joe Payne was the CEO of Eloqua, which he took from early-stage, to publicly-traded to an acquisition by Oracle. Joe talked about the path of a board from early stage to public. Early stage boards are more hands-on and meet twice as often as the board of a publicly-traded company because these boards are often comprised of investors who have a stake in the company. They tend to be more in-your-face with the CEOs. The board of a publicly-traded company, like the larger companies they govern, are comprised of a larger number of people and often move more slowly in making decisions. But he emphasized that regardless of the stage of the company, the CEO must be in charge and call the shots. Joe had such a good time interacting with the students that he stayed for the second half of the class and then hung out with the students afterward.
Larry Scott is the PAC 12 Commissioner, which is comprised of the athletic organizations from 12 public universities. He talked about the complications of reporting to twelve university presidents, one Chair, twelve athletic directors, twelve senior women athletic administrators, twelve faculty representatives and twelve student athlete leaders. Plus, he interacts with the coaches of all the sports at all twelve universities. Larry talked about how important it is to listen to all levels of the organization and understand their needs and struggles. CEOs and boards shouldn’t be so removed from the employees and the customers they serve that they cannot understand the interests of all who are impacted by their decisions. Balancing those layers of interest with the best decisions for the PAC 12 is what makes an outstanding leadership and board.
Brad Tilden is the CEO of Alaska Airlines and a former student at the Foster School of Business. His appearance in the class was a bit of the prodigal son returns. He spoke to the class about the Alaska merger with Virgin America. The merger had just been finalized, so we got a fresh take on the whole process. Brad talked about the process of SEC approval and how having a diverse board helped him make better decisions throughout the process. He talked about the importance of gender parity and how having a diverse board helps him understand the broad set of customers they serve. Having the right mix is critical.
Kyle Polanski is another returning alum. He is the CEO of Blue Dog Bakery. Kyle raised the capital to purchase Blue Dog Bakery after he took this very class a few years ago and received his MBA from the UW. Now he has returned to speak about his experience in selecting a board. Kyle talked about cultivating a board member of a well-known business in Seattle who didn’t necessarily have any experience with dog food. Going for name-recognition only resulted in a huge problems as egos clashed. This person started dominating the board and driving decisions. Kyle tried to sway him to be more collaborative, but eventually had to remove him from the board, which is difficult to do at any stage of a company. Kyle talked about building a strong board based on expertise and experience, not necessarily name-recognition. Like many CEOs, Kyle made some mistakes and he learned from them. The students benefited greatly from his candor.
The class has concluded now, but it was a fun ride! The students were bright and engaging. Most everyone had a win walking out of the class with an opportunity from a new company. It was exciting to see their successes unfolding as the semester came to an end.
I’ve agreed to teach again next year because I enjoyed the challenge of starting a third career in my 70s. Plus, the summer has brought a brand new trick for this old dog to explore with the students next year, having wrangled this international board into a successful deal for the company we serve.
Most importantly, I love working with the students. My new co-teacher will have her own business connections to spice up the class content, and I hope to make the course even more engaging and lively. My transition to an adjunct professor is officially a work in progress.