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How Young Directors Are Changing The Boardroom
They walk into the boardroom wearing jeans and carrying backpacks. As the meeting stretches over hours, millennial directors convey with their body language that they are not used to sitting and listening; they’re programmed to interact. When the company serves plated lunches, some order out sushi.
Those who have “grown up digitally” are the ultimate prize in the hunt for directors who can help boards and CEOs address the technology innovations that are fundamentally changing every business.
A new digital industrial economy is emerging where every company is a technology company. It requires directors to develop a core understanding of how technology can impact the business, whether it’s lowering the costs, better connecting to customers or improving the company’s offerings.
A new group of directors, call them “digital natives,” have joined the boardroom. They’ve achieved success in tech companies, and they incorporate technology and digital platforms in nearly every facet of their lives. With their energy and techno-savvy expertise, they are changing the boardroom.
Chris O’Neill was managing director of Google Canada when he joined the Tim Hortons board before the company was merged with Burger King.
“I was able to leverage my experience in Silicon Valley to provide insights into emerging digital and broader technology trends in business, and offer my perspectives on how companies stay customer-focused and create a winning culture,” said O’Neill.
Now CEO of Evernote, O’Neill leads a software company that creates productivity tools for the modern workplace. His success at Google included achieving dramatic growth as managing director of Google Canada. He was also once part of Google X, Google’s moonshot factory.
Nathan Richardson was the digital talent of the team brought together to restructure and transition C.M.I. from its yellow-pages origins to a digital company. Richardson is still on the board of the company, now called Caribe Media Inc.
The former head of Yahoo Finance, the largest finance site on the Web, Richardson also was head of Dow Jones Online. In September, Richardson and his partners announced closing a $4-million seed round for Trading Ticket, a new start-up based in New York that is developing a suite of products to help consumers become more active investors.
When he joined the C.M.I. board at age 40, Richardson was impressed with his older board colleagues who were eager to learn what he could share with them about the digital challenges and solutions as well as insights into the millennial culture. To the criticism that most boards are pale, male and stale, Richardson adds, “and straight.”
The lesbian, gay, bisexual and transgender community has been “the last people to achieve full civil rights,” said Richardson, who serves as L.G.B.T. diversity adviser. “I’m an advocate for diversity because it improves decision making.”
Expertise is another component of informed decision making.
There is a huge unmet need for board expertise in tech and the creative digital space, observes Suzanne Muchin, who has been on both sides of the boardroom. As a national program director for Teach for America, she interfaced with the prestigious national board and helped her staff with the regional boards. She currently serves on the board of Piece & Co., a for-profit private company in the social responsibility space that hires women artisans in the developing world to provide the fabrics and other raw materials for fashion brands.
She sees younger board members bringing an energy and a penchant for greater work-life balance as they embrace shorter meetings, working remotely and making the full board meeting an occasion for active engagement and meaningful discussions.
“I’m 47, slightly older than what is considered millennial,” said Muchin, “but because I have one foot in the tech space, one foot in the social impact space, and an arm in the nonprofits, and I’m a woman and a business owner, I cross lots of demographics.”
A principal of Mind + Matter Studio, cofounder and cohost of “The Big Payoff” radio talk show, podcast and video series, Muchin has founded several communication firms focused on developing social impact campaigns. Her previous company, R.O.I. Ventures (Return on Inspiration) was acquired in 2012.
Digital directors are often entrepreneurs like Ryan Morris, who cofounded software company VideoNote after graduating from Cornell Engineering. But it was his investment in InfuSystem that turned him to activism, a board seat and becoming one of the youngest chairmen of a N.Y.S.E.-listed company at age 27.
Morris is now president of his own investment firm, Meson Capital Partners, which focuses on “constructive, active engagement, value-investing.” As an investor/operator, he can “wind up fixing my own problems.”
As an investor in InfuSystem (N.Y.S.E.:INFU), Morris met with the board after it had approved a multimillion-dollar pay package for the CEO while the company was failing. He rallied other investors and demanded three board seats. After being rebuffed, he eventually succeeded in replacing five of the seven directors with a negotiated settlement.
But the story of young, entrepreneurial and tech-savvy board members isn’t new.
Mark Tebbe was 31 when he was recruited by Nolan Bushnell to the board of OCTuS Software (Nasdaq: OCTS). “Yes, I was flattered,” said Tebbe. “It doesn’t get any better than working alongside Nolan Bushnell. He’s a world-class entrepreneur, a giant in the field, the founder of Atari and Chuck E. Cheese.”
The year was 1992. Tebbe was recruited for his knowledge of the computer industry. Having moved to Chicago to work for Arthur Andersen, he started his own technology advisory firm, Lante Corp. (Nasdaq: LNTE) in 1984, which he took public in 2000, took private in 2002 and sold in 2004. After Lante, he created Answers.com, which began as a solution to help his son with his homework. The Answers Corp. (Nasdaq: ANSW) was sold to Announce Media in 2011.
Tebbe spent six years working alongside Bushnell on the OCTuS board. It was the chance of a lifetime, learning from a master. Since OCTuS, Tebbe has experienced first-hand the value boards bring to an enterprise, particularly for entrepreneurial companies.
Tebbe recruited his own board when he made the decision to dramatically grow his business in 1998. “There was so much talent on my board. I wanted to tap their experience and leverage their insight because they had so much more experience than I did.
“I keep that in mind when I serve as a director,” said Tebbe. “I try to be very involved to understand and grow the business, because I expected my board to understand and help me grow the business. I also push and challenge and look at strategy from a number of different angles.”
While he doesn’t expect to start a new company, Tebbe likes to stay on the cutting edge by teaching at the University of Chicago, by mentoring entrepreneurs at 1871, and by serving as chairman of ChicagoNEXT, the technology industry’s economic development component of World Business Chicago.
It’s the yin and yang of board culture—younger directors with digital knowledge and expertise working with traditional directors with the business experience and years of perspective.
“Young directors can improve a board’s understanding of customers and today’s workplace realities,” said O’Neill. “Customers are living digital lives. Employees are using new and exciting ways to communicate with one another. Though this is not strictly linked to age, being younger and more digital certainly helps and is a positive force in assisting companies to address new markets.”
There are personal benefits as well.
“I learned to view a business through multiple lenses now. I feel better prepared for my current CEO role because of my board experience,” said O’Neill.