The most effective board members apply proven mental habits to the decisions at hand. Charlie Munger, Vice Chairman of Berkshire Hathaway, likens these mental models to building a “latticework” for organizing knowledge about the world. The best boards think better as a consequence of the discipline required by these mental models.
All board members use mental models, even if they don’t use that label. The Pareto principle (also known as the 80/20 rule, which states that for many events, roughly 80 percent of the effects come from 20 percent of the causes) is a common mental model. So is Occam’s Razor, which states that in selecting among competing explanations, we should prefer the simplest explanation. These mental models are generally powerful because they require you to change the way you see things, and when you change the way you see things, the things you see change.
“The most effective people are more invested in the result than in making themselves look good.”
Here are four mental models that are particularly applicable to the fast-moving strategic challenges confronting board members.
- Results are More Important than Credit
“It is amazing what you can accomplish if you do not care who gets the credit.”
Harry Truman (1884-1972)
33rd President of the United States
There are many variants of this observation attributed to many people, but the essential message remains the same. The most effective people are more invested in the result than in making themselves look good. This mental model is an expression of servant-leadership, eschewing any hint of self-interest in the interest of the organization. A corollary of this mental model is focus on achieving the best outcome instead of proving yourself correct. Board members who are working to prove themselves right will work hard finding evidence for why they’re right.
It’s all about letting go of ego.
- You Are Responsible
“If it is to be, it is up to me.”
William H. Johnsen (1901-1970)
This mental model requires that board members give up any sense that they are a victim to external circumstances and take responsibility. In formal terms, it challenges board members to shift their perspective from an external locus of control to an internal locus of control. Under this model, board members accept one hundred percent of responsibility for the board and the company. Board members applying this mental model hoard all the blame and share all the credit. If a decision fails, it is all on you. Yes, others may be involved and others may have let you down, but you can’t blame anyone else for your choices. There are no bad boards, only bad board members.
- Character Above All
“Leadership is a potent combination of strategy and character.
But if you must be without one, be without the strategy.”
Norman Schwarzkopf (1934-2012)
Commander of Coalition Forces, First Iraq War
Schwarzkopf summarized this mental model with the question he asked first of himself and then his subordinates: “Will you do the harder right, regardless of what it costs you?” It was Schwarzkopf’s definitive question of leaders. It plunged right into the leader’s innate character where the battle between what we are and what we should be is fought every day. This mental mode imposes constraints. It requires board members to accept that they may control their actions, but the consequences that flow from those actions are controlled by principles. Honoring one’s character imposes constraints on freedom, but it also liberates the decision-maker.
“Delegate everything except genius.”
CEO of Strategic Coach, Inc.
This mental model is a rejection of micromanaging and a force multiplier for results. The most effective board members understand that they serve best by doing the one thing they do best and delegating absolutely everything else to others. Of course, this requires board members to identify what they do best. If the key people have been selected and trained well, the delegation model will lead to execution and success.