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Episode 3: Be Board Ready




Join BDO in discussion with Betsy Atkins, three-time CEO and serio entrepreneur, board of director of numerous corporations, founder of Baja Corp and author of Be Board Ready and Behind Boardroom Doors, as she shares her thoughts on:
  • Defining your strategy in seeking board service and ask yourself “why not me?”
  • Pay forward value and receive value in return
  • Prepare yourself and where you may have gaps to fill, seek resources to fill them
  • How to contribute meaningfully and bring new ideas into the boardroom


Transcript

This transcript has been lightly edited for clarity.
Nicole: Hello everyone and thank you so much for joining BDO’s podcast series, Getting to the Boardroom. I'm Nicole Ward Parr and in this series I have the pleasure of hosting some of the most distinguished executives currently serving on public company boards to discuss their journeys and the paths that got them there. Today, I'd like to welcome C-Suite executive and public company board member, Betsy Atkins. Betsy is a three-time CEO, serial entrepreneur, and founder of Baja Corporation. She has cofounded enterprise software companies in multiple industries, including energy, healthcare, and networking. She's an expert at scaling companies through hyper growth and leading them to successful IPO and acquisitions. Betsy is a corporate governance expert with an eye for making boards a competitive asset. Her corporate board experience is vast and covers multiple industries, including: technology, financial services, healthcare, retail, automotive, manufacturing, and logistics. As a corporate director, she brings an operational perspective which focuses on taking friction out of the consumer experience. She leverages broad, contemporary knowledge of digital technology to reduce costs and drive efficiency and productivity while using AI machine learning analytics to streamline processes. Betsy has written three books on corporate governance. Her most recently published book is titled, "Be Board Ready: The Secrets to Landing a Board Seat and Being a Great Director." She currently serves on two public company boards: Wynn resorts, and SL Green Realty. She's also a member on the board of Volvo Cars. Betsy, such an amazing background and we are so grateful to have you join us to share about your journey to the boardroom today. Thank you so much, welcome.

Betsy: Nicole, I'm delighted to be with you and the audience.

Nicole: Wonderful thank you so much.  Let's dive in. Let's start at the beginning. Going back, right? Would love to know when you were considering your first board role, did you have a strategy, a thought process, or specific approaches that you used?

Betsy: Well, my first board role was on a company that I co-founded and wrote the business plan and negotiated the venture investing, and I said to the venture investors, a condition of their investing was that I would be able to be on the board. So, my strategy was if you want me to take your money, you have to take me along with it.

Nicole: That's fantastic. I love that tactic. That whole negotiating approach there. Way to go! That's pretty powerful. That's terrific. And so, how did that play out for you? And did you leverage that board role into another or your 2nd?

Betsy: Well, my belief was, and I think it's true for everyone listening, “Why not me?” My ideas are good. I think and problem solve as well as anyone else. Why shouldn't I be part of this board process? So, I deliberately set out with a conscious plan that I wanted to join other boards. So I talked to colleagues in the venture capital world, and my first boards were a series of private venture backed corporate boards. And then of course, some of them went public, and I was kind of on my path pursuing public boards and I have always, still, and do now pursue private boards as well, both venture, and private equity backed.

Nicole: Got it. So, you have the range clearly of doing both private and public company boards. I'd love to come back to that a little bit later, just to get your perspectives on that further. But in terms of actually getting those roles,  what were some of the specific tactics? Or how did you leverage your network to get access to those other board roles?

Betsy: So, with venture investors, and the same would be true of private equity, what they're looking for is: How are you going to help them make the portfolio company, the businesses be more successful? And if you look through that lens, and my approach was to try and forward invest and prove to them that I was an asset. So what I did was, I asked, can I help coach or mentor some of your portfolio companies? Here's where my experience would be relevant. So, you look at your own experience. If you're a technical person, a finance person, a marketing person, you know where your experience is relevant to the portfolio company, and by offering to just give help for free. Then I evolved it to: How about if I become an advisor to these companies? Let me do an advisory board gig and so you show that you're adding value. And if you do that a few times, then it's reasonable to say, I think that I could be a great asset for one of your boards. And here is where I could fit, and why I'm different, and how I could help that business grow. So if you look through that lens, that's a receptive audience.

Nicole: That's a fantastic takeaway for our listeners, is focusing on where you're going to be able to add value and then doing it in a complementary fashion, initially. Like you say in an advisory capacity and then you're able to point to a track record. That's a great takeaway. I think, very good. And did you have a champion or a mentor? Someone who was senior to you in experience, but that could give you guidance and insight along the way as unique journeys and sort of learn the ropes.

Betsy: You know everybody today has mentors, sponsors, champions. When I started it just wasn't a thing, and I didn't. But I had a great advisor in my mom who basically said to me if you pay it forward, and if you forward invest, and if you forward deposit into the bank then you can withdraw. So, if you do things for these venture and private equity investors where you're helping them, and you're not asking for anything in return, you're just forward depositing into the bank: proving credibility, follow through, execution, value add. If you're doing that in advance, then it's reasonable to come back, some number of months later, after you've made a considerable deposit, not like one little favor. You've got a pattern and they see that you're reliable. You're there, you follow through, you execute. Then it's reasonable to go back and ask and say, I think that I'm adding value and here's why you would want me. So, it was my mom's advice of forward invest, be generous spirited, pay forward three to five favors, or ways of helping before you ask for help.

Nicole: I love that concept, forward investing and paying it forward, and adding value. Almost altruistically, knowing that on the back end it will speak for itself and that they would welcome the opportunity to help you further right? As a token of all the value that you have added along the way. I think that's brilliant.

And through the process of your early board experience, how did you self-identify areas where you thought, whoops, I don't know about that and I should, or wow this is an area I'm going to need to improve upon where I could be adding more value, because we all have those blind spots. How did you self-identify those? And then how did you speak to those to further prepare?

Betsy: I think that, first of all, boards will look at you as having certain domain strengths and expertise that you're going to bring. So, evaluate yourself and what are your core strong areas. If you're a finance person, then maybe it would be valuable to learn more about product strategy, or be more conversant on marketing, but your main power alley is always going to be finance. So I think, in terms of how you message yourself downstream, it's going to be where your power is. You do need to be more well-rounded and there's a lot of great business books and YouTube info out there and colleagues will mentor you and I think that, that sets you up to go to your boss, and your boss’s sideways peer and work through the organization and find somebody who you connect with who you think has the orientation to be helpful. And that's the way to ask for mentorship to say, I'm a super talented finance person, but you could then go to the CMO or the chief revenue officer. Let's say you're in an organization and you’re a vice president of Finance. You're not the CFO, but you could then go to those other peer CMO, and CRO and say, “Tell me about how you do revenue forecasting, how you think about which geographies and territories to go into, how you look at productivity of the sales organization,” whatever it might be. Because they're happy to mentor you when you're interested in their area and, assuming you've selected somebody who's oriented to be receptive. So, I think that's how you round out your general business knowledge.

Nicole: Great, that's excellent points there and I'd love to know what mistakes you made when you were in the boardroom. What were some of the unforeseeable’s and the “whoops” that you encountered as you came up?

Betsy: I think that the mistakes that I made are natural ones that everybody makes, which are in the beginning you contribute too much, over contributing, talking too much, just agreeing with others. You don't need to agree  if you don't have something unique and different to contribute. Don't just chime in and chirp up, “Oh, that was a good point so and so. Nice idea!” No, don't do any of that.  The way you ought to think about boardroom communication, or how much you talk is like baseball. Nine innings. Three at-bats. You don't need to speak more than three or four times. Make it meaningful.

Nicole: That's great. That's a wonderful share and I think, like you say, sometimes when we're nervous, when we're unfamiliar, we can try to fill in the blanks and it's not necessary.  That's fantastic guidance. And in terms of preparing, what type of preparation do you do when you're going into the boardroom, and is there a certain agenda that you drive, certain questions that you go in prepared to ask? Is there a formula that you use or is every situation different?

Betsy: There is a formula in an approach, so preparing either for a board interview or a board meeting is sort of the same in terms of research. I look at, of course, the material on the company, what you can find online and really valuable on YouTube and I look at the CEO's earnings report that they do with the analysts, which is recorded, and you can get the whole transcript. So that gives you good frame of info on the company. The second thing is to look at the industry and look at the peers and there are reports from Morningstar and the banking financial analysts, but there's also industry reports which you can get from Gartner or Forrester or IDC. Those are big industry research that will give you everything going on in the financial services industry. What are the innovations in online payment? And whatever it might be. And then I look at McKinsey, Accenture, Boston Consulting Group. I look at those macro trend  reports that talk to you about, what are the emerging trends in each vertical industry. I feel to be a valuable director, you need to do your homework and bring a new frame of reference, not just what the company gave you, which is important and you have to study it and know it, but that's their lens on their industry and you're supposed to be bringing a new perspective. So you got to do a little more work.

Nicole: I think that's a wonderful segue to my next question, which is really about diversity in the boardroom, and the value . . . and the different perspective which you just shared that's so important for you to bring, to contribute, to add values. So, talk to me a little bit about diversity on the boards on which you sit.

Betsy: So I think we should think of diversity as cognitive diversity, because if everybody is exactly the same, we all see the same opportunity, and then we all have the same stigmatism. We all miss the same risk. You're looking for a range of thought, and obviously if you're not including women, that's half of the entire people on the planet whose perspective you're not getting, so you certainly want gender diversity. But I think it's a lot more. I think you want generational diversity. If I'm a direct to consumer business, I want to know what gen zero and millennial consumers are thinking, especially as their outside influencers don't have the brand loyalty of gen X and baby boomers. So, I want generational diversity. I want ethnic diversity. I want geographic diversity. You know, large public companies in America typically half the revenue is outside the US. So where is the viewpoint on Europe and Asia? We need that in the boardroom. So, I think that it's a range of diversity, of thought that you're looking to have, because that gives the best discussion, debate, and the most thoughtful outcomes.

Nicole: Excellent points and I couldn't agree with you more. And in terms of the boards that you're currently on are there certain ways, tactics, things specifically that you've done to encourage the diversity that you just outlined?

Betsy: Yes, actually, I will share a little story. I was on the board of a wonderful company. I was the lead independent director and governance chair at Home Depot Supply, and they’re a stocking, distributor for the Home Depot you know, but for the professional, for the big construction worker, the facilities manager, somebody running an apartment building, whatever. And we were talking about our e-commerce, our website and digital transformation, and I'm from the tech industry so it's a buzzword everyone's heard, but nobody knows what it is, and I said it, and I looked and everybody was like, “Digital transformation, what’s that?” And I realized we were not all at the same understanding of what digital transformation is. Our CEO is terrific, so we had working dinners instead of going out to a restaurant, eating another fattening meal and just socializing with your colleagues. We went to the training room of the company. We brought in a speaker from McKinsey, followed by a speaker from Boston Consulting Group, followed by a speaker from Accenture and we had the leadership team of the company there, and each of the three speakers from the big consultancies talked about how they defined digital transformation, what it meant, how you did it. How did you operationalize the concept? And after we heard the third speaker in a row, because we started at 5:00 and each speaker we left an hour - so, 5:00, 6:00, 7:00 and we had pizza and salad on the side board. You know we really had a pretty good appreciation of, “What did that mean?” And it was such a great model that I've done it ever since on my other boards. We bring in the speaker on cyber. Whatever the topic is, robotic process automation, disruptive business models, the gig economy, marketplace models, whatever it might be, and that really has proven to be a great way to get more, different thought into the boardroom and more perspectives.

Nicole: Yeah, that's truly innovative, and what a great approach. That's refreshing, right? And, you know, it leads me to the thought, and I'd love to get your perspective on this,  just how much the boardroom has changed and how much innovation is talked about but also expected, on behalf of the board members, right? There's so much for you as a board member to stay in front of, to have an understanding of, right? All the things that are now real responsibilities for board members. I'd love to get your thoughts on what is innovation in the board room and how has the boardroom changed? Even just, you know, 20 years now into the 21st century.

Betsy: So, the boardroom model of engagement is very different. In the past, in the 1990s, boards were more formal and more oversight, and we saw the whole board engagement model change post Enron and WorldCom, where you had these catastrophic meltdowns, and the first thing that came out of that was this thing called, “the executive session” where at the end of the board meeting management leaves, the CEO leaves. They're always all nervous, especially the CEO that we're going to talk about him or her. Which we are and we do, but it allows for the board members as a group to talk about opportunities, concerns, and that evolved the next change in the boardroom, which was the strategy offsite, which now is a best practice. Most companies once a year, do a three-or-four-day board meeting, a deep dive into the company's multi-year strategy. And as board members got to understand the underlying assumptions, the next big change was, boards are more interactive. They're not just doing oversight, approving the annual plan. There's more time left for discussion and dialogue and engagement. And I think now we see the view of the board as more of an asset to help the company anticipate risks. Because the rate of change, as you said in your question, innovation is at a geometric pace, so your competitors change quickly, business models change quickly, and so the engagement is more interactive, and I think that's all a positive. So that's been the kind of change of the board engagement model, as I've observed it.

Nicole: Excellent examples for sure, and I would love to get any other thoughts or comments, advice for the listeners, that you think would be particularly meaningful. What are the questions I forgot to ask you, Betsy?

Betsy: I think the question of, “What should be my process to get my board opportunity? How do I go about it?” And I wrote a book that actually gives you the road map of all of the different avenues to the boardroom, and the tools and the specific sort of playbooks to go after each of the avenues to the boardroom. Because there are multiple avenues. There are your peers in the company who would recommend you. There are the search firms. There are the outside accounting firms who advise boards. The outside law firms who advise boards. The outside bankers. There is, you know all the governance watchdog agencies. For the women in the audience, there's a lot of great women's groups that will help promote you. So, there are many pathways which I described in the book, because I'm assuming people are listening because they're interested to get an opportunity to get on a board. And that's what I lay out in my book, Be Board Ready. How do you “be board ready,” and how do you get there?

Nicole: Fantastic yeah and just to say that title again for you it's, Be Board Ready: The Secrets to Landing a Board Seat and Being a Great Director, by Betsy Atkins. Betsy, very excited to get all of your thoughts and your perspective on all things board related and I can imagine the book is just another wonderful journey, and full of lots of great insights. So very much appreciate that. And are there any last thoughts you'd like to share?

Betsy: Yes. You can all do this. There's no reason why you're not smart enough, hardworking enough, clever enough, valuable enough and you should aspire to get to the boardroom. You absolutely will add value. Go for it. Don't ever short change yourself. You'll do great and you'll be a terrific contributor.

Nicole: Oh, I love that and I'll go back to what you said at the very beginning which is “Why not me?” Why not? Right? Which is wonderful. Betsy, all of your thoughts are so appreciated and such a great perspective, with so much insight. Truly grateful for you to spend the time with us that you did this morning and many thanks. Be well and thanks so much.

Betsy: My pleasure.
 

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