Have Management Committees changed after Covid?

Have Management Committees changed after Covid?

How are the Management Committees different after Covid?

In the middle of 2021, we again carried out an extensive survey among Spanish managers to understand the way in which the pandemic had changed the dynamics of a fundamental piece of corporate governance: the management committees. We also take the opportunity to ask about issues related to transversality, remote work, etc.

The acceleration of changes in the markets, the pandemic is a unique case of these changes, forces companies to make decisions full of uncertainty more frequently and to execute initiatives with a greater risk of not coming to fruition. This, that is the hypothesis with which we did the field work, forces us to “invest” in relationships of respect and trust among the members of the steering committee. This requires a shared vision, more transversality and a more inclusive profile as a member of the management committee.

Our intuition warned us of a possible polarization in this regard. In the “good” range, companies where the CEO and his team are able to practice intelligent collegiality and where the complementarity of diversity is “monetized” in better decisions and in good execution. In the “bad” range would be the management committees with dysfunctional dynamics among their members and decisions and implementations based on the imposition of the interests of managers with more power over their colleagues with less muscle.

This is where the role of the Management Committee gains prominence, becoming one of the strategic assets most vital that the organization can have. allying closely the CEO (Chief Executive Officer) with the CHRO (Chief Human Resources Officer), the CFO (Chief Financial Officer) and the Commercial Director. East ‘triumvirate leadership support The chief executive will be responsible for executing the commercial strategy, with different but highly interdependent roles: the CEO defines or leads the vision and strategy; the DCP articulates and drives the people’s agenda and the CFO manages financial resources and investments.

The effect of the pandemic on relations within the Management Committee has been generally positive

The effect of the pandemic on relations within the Management Committee has been generally positive. 43% of those surveyed affirm that the crisis has united them as a team and 27% have confirmed greater collaboration. The lack of physical contact, on the other hand, has distanced them emotionally.

The majority (68%) of those surveyed think that its company has correct work dynamics in the Management Committee for the current circumstances. Now, it is overwhelming those surveyed (84%) who recognize that these dynamics (preparation, agenda, format, follow-up, etc.) have changed a lot or quite a lot due to the pandemic.

The CEO priorities According to those surveyed, it is redefining and ensuring the execution of the strategy (68%), motivating and involving the human team to face challenges (57%), identifying new opportunities and challenges (57%) and putting customers at the center of the strategy (40%). On a second level, the increase in collaboration between the areas, improving communication and continuing the effort for digitization stand out.

The issues that have gained weight on the agenda of the Management Committee are, instead, putting the client at the center of the strategy (51%), risk management (45% of those surveyed), the safety of both employees and customers (43%) and innovation (40%).

The relationship between Board of Directors and Management also came under scrutiny in the survey. The first has to move more with high beams, the second with low beams. Both at the service of creating a healthy and therefore competitive institution. In any case, the symbiotic relationship between the two is essential for sustainability. In the survey, 42% of those interviewed affirm that the relationship between the two bodies has worked, compared to 24% who have perceived dysfunctions, due to excess control and pressure from the board of directors on the management board.

Respondents were asked if their company has the Management Committee suitable for dealing with the crisis the affirmative answer was 67%. Among the changes and improvements suggested, the incorporation of people with knowledge and experience in issues that are priorities for the strategy (75%), the need to agree on new rules to improve teamwork (54%), the change in the frequency and formats of meetings (48%), mentoring/coaching of its members (44%) and training/advice to improve meeting management and collaborative work dynamics (40%).

The photo of opportunities for improvement from the Board of Directors is as follows: 33% have not carried out the evaluation and improvement plan of its management teams; a similar figure does not have a succession plan for its key executives and 25% of those surveyed acknowledge that their company does not currently have a management training plan.

Returning to the Management Committees, those surveyed foresee that in the future that body will be more operational (78%), more liquid, that is, with permanent and non-permanent members (63%), with more flexible operating rules (56%) and, lastly, smaller in number of people and with different formats depending on the content and the type of decisions they have to make (41%).

The sum of good coordination mechanisms and a culture of trust generates collaborative processes that feed

The proper functioning of a company requires coordination mechanisms between the areas. The sum of good coordination mechanisms and a culture of trust generates collaborative processes that feed, and at the same time feed the desire for reciprocity. The result is better decisions, better execution and a good atmosphere.

With poor coordination and little trust, the result is dysfunctional conflicts, fights for power, defense of territory, etc. Most of those surveyed believe that transversal projects are being promoted from the Management Committee with a high degree of effectiveness and efficiency (high 41%, Medium 48%), and that the quality of collaboration between the areas of their company is reasonable ( high 38%, medium 51%)

Five o’clock best rated initiatives by respondents for improving collaboration between areas highlight the use of performance metrics and performance incentives that encourage collaboration at work and that emphasize the achievement of common goals.

Also develop a leadership style that avoids resorting to escalating problems of lack of coordination between areas, working with high-potential managers to develop their collaborative skills, ensuring that critical processes are designed “end to end” in such a way that there is an owner of the process that is involved in the global improvement of the same and accustom the organization to work using interdepartmental work teams for important future projects.

Finally, the five management skills most necessary to perform well the work of a member of a Management Committee after Covid, in the opinion of those surveyed, are: Strategic vision, an inclusive Leadership capable of motivating, inspiring and uniting people, Effectiveness and results orientation, Decision making and resilience; Values ​​and exemplarity: solidarity, closeness, humility, optimism, courage, integration of professional and family life

A leader with the ability to integrate his team and align the company with its market is a gem. The pressure of the next few years will see many diamond-looking companies emerge. The beauty of diamonds comes from the integration of its elements caused by the pressure to which they have been subjected. Maybe that’s why we like the quote from Churchill Pessimists see difficulties at every opportunity. Optimists see opportunities in every difficulty. These are times of difficulty and opportunities.

***Antonio Nunez He is a Senior Partner of Parangon Partners and founder of the Harvard Kennedy School Alumni Association. Luis Huete He is an extraordinary professor at IESE Business School and vice president of the Governance and Society Institute.

Methodological note: The survey was sent to a sample of 2,320 senior managers, of which 63% are CEOs, 26% are Corporate Directors of People and 11% Senior Managers with responsibility in the Management Committee of the companies. The sample ensured equitable representation of the main sectors, types of company (multinational, national, family and startups) and company sizes.

How are the Management Committees different after Covid?

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