Why directors need to go back to school

Company directors have been in the news mainly over their "fat cat" salaries. But this is of far less importance than the "performing" side to their duties, according to a new book.

This does not refer to their prowess on stage. Rather, it means their ability to do the job.

One of the paradoxes of management is that while it is universally accepted that training is needed throughout the organisation below board level, few dare suggest it should apply to directors. Consequently, training courses for directors are few and far between. In the view of Bob Garratt, author of The Fish Rots from the Head (HarperCollins, pounds 18), this weakness must be remedied.

"Worryingly, under present institutional and legal structures, it is only in a crisis that directors might, much too late, become aware of what is required of them," he writes. An international consultant on director development and strategic thinking, he believes that not preparing directors adequately for their role lets them carry on doing what they were before - managing.

You might think that being a director is a reward for being an effective manager and requires little more than supervising the person who has taken on those responsibilities. But Mr Garratt sees a distinction between the hands-on business of managing and the more intellectual activity of directing.

The latter demands a broader approach and the ability to stand back from day-to-day tasks to concentrate on such issues as policy formulation, strategic thinking, management supervision and accountability. The board's job, he writes, is to keep striking balances between internal and external pressures on the organisation to ensure its survival. This entails giving a clear direction to the business and creating the climate in which others can align and attune themselves to that.

It is because many business people have spent their careers doing rather than thinking that they find this aspect of being a director daunting. He might add that this could also account for their susceptibility to the services of management consultants.

In the book - whose title stems from a Chinese proverb of dubious provenance - he sets out how this can be countered through developing directors in much the same way as their subordinates have been in recent years. But all is not lost. Mr Garratt is confident that, by following certain guidelines and learning processes, individual directors and boards as a whole can reach required levels of competence.

Companies are reluctant to send directors on courses because that might suggest they consider themselves incompetent. But Mr Garratt claims that courses run by organisations like the Institute of Directors are attracting interest from some companies.