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Notes by EMA: How To Make Committees Work Better

The Boards of AEV and AboitizPower recently toured the SNAP Magat, SNAP Binga, and Pilmico Tarlac facilities. As AEV Chairman Endika Aboitiz explained, these site visits provide opportunities to “meet [our] people on the ground” and helps the Board gain a deeper understanding of the entire business and appreciate the entire picture better. This, in turn, supports the team in their role to guide, govern, and steward the Group’s growth ambition.

 


 

 

How To Make Committees Work Better

by Endika Aboitiz, AEV Chairman of the Board

Aboitiz Eyes recently published committee structure of our Group. It struck me that, as much as we do need committees to manage a business like ours, our priority is still the customer and how to make him happy. Can we wow customers? I am sure we can in many of our businesses.

 

In power generation, our main business, it may be harder. It has become a commodity. EPIRA has succeeded. Brownouts are a thing of the past. They will be replaced with companies losing money or, at least, returns in a highly competitive temporarily oversupplied business. Financial brownouts will follow.

How do we get our committees to make the most out of less time so we can spend more time on our customer?

Committees are necessary but they are not an end. More work in them is not there to make us feel a warm glow as they do in government. For us, it is like going to the toilet — necessary but for as little time as possible; well for most!

I looked around and found this advice, which is short and made sense. It outlines six key lessons for committee work related to the size and composition of committees as well as their internal processes.

 

 

1. Get the size right.

In general, groups with six to twelve members tend to perform better than those in either smaller or larger groups, especially when relying on virtual communication. Below six members and the reliability of decisions falls away, above 12 and it becomes unwieldy.

EMA: THE BOOK ‘FARSIGHTED: HOW WE MAKE THE DECISIONS THAT MATTER THE MOST’ SUGGESTS THAT MANY ARE GOOD AT GATHERING PERSPECTIVES BUT NOT AT DECIDING. DALIO SUGGEST 3 TO 5 PEOPLE IN THE DECISION-MAKING FORA. THE INCREMENTAL PERSON COMES AT A NEGATIVE RETURN.

2. Get varied perspectives.

We all have our own bias and the wider the range of knowledge bases and opinions on a committee, the better. For the best decisions, try to appoint members from all key stakeholder groups, within the size limit.

EMA: KEY ADVICE – WITHIN THE SIZE LIMIT. DO WE TEND TO TRY TO BRING IN TOO MANY  ON THE BACK OF THE REASON OF EVERYONE?

3. Give people time.

Members need time to digest and analyze information presented to the committee before decisions are made. This is particularly the case if you have a diverse range of opinions and information informing the committee.

EMA: MAYBE REASONABLE TIME BUT LESS TIME THAN THEY NEED. WE NEED SMART PEOPLE WHO THINK FAST

4. Use formal decision making.

Set out the committee’s scope clearly. All committee members need to know exactly when and how decisions or recommendations are to be made (e.g. is consensus required?) and should be given the relevant technical literature to inform their decisions.

5. Face-to-face contact matters.

It’s not always possible to get everyone in a room together but be wary of relying on technology. Using email or bulletin boards instead of face-to-face discussion means members become more disengaged, and while working virtually can allow for a more diverse membership, it makes it harder to build trust and cohesion.

EMA: I GUESS WE ARE STILL SOCIAL ANIMALS

6. Make diversity work for you.

Demographic diversity is valued for bringing different perspectives and a wider variety of alternatives for consideration. Educational and functional diversity has given teams greater strategic clarity. However, you need to make sure that you manage this diversity well. More time and effort may be required to explore issues requiring judgments where committee members vary in status or come from different backgrounds.

EMA: ENGAGED AND ATTENTIVE 24 x 60 x 60 x SEVEN FOR A COMPLEX WORLD MUST NEED DIVERSITY OF PERSPECTIVES

I see Carlos has removed positions in the discussion world of Hedcor. Can one argue that we are here to honor the position and not the position is not here to honor us? Can one argue that the position is best honored being left outside the meeting door? Can one argue that position power of leaders does not warrant the rearing of its ugly head when we are looking for the farsighted decision?