Corporate Governance: A New Approach for Building Enterprise Value
By Bill Boyar Chairman, Boyar and Miller | January 14, 2010
Valuable Senior Purpose
The starting point for effective governance is valuable senior purpose. Senior purpose is that fundamental commitment to the shared interests of investors, employees and customers. It's what customers will pay for and employees and investors will willingly provide and protect. Some refer to this as mission. Others call it vision. Whatever the name, a clear senior purpose is the cornerstone of any organization. Healthy companies will protect and advance the shared interests of the three constituents in serving the senior purpose. An unhealthy (or diseased) business will more typically sacrifice the interests of one of these important constituents. (See the discussion under Alignment below).
Without a clear commitment by all constituents to a shared senior purpose, it's difficult to govern at all, let alone effectively. Without a shared senior purpose, individual agenda overcomes creative, collaborative and cooperative decision-making.
The second important element of effective governance is valuable communication. By valuable conversation, we mean communication that is designed to produce value for the company and avoid and eliminate waste. Most organizations need tools in order to stimulate collaborative interaction. Our friends at Conversant, a Boulder, Colorado headquartered consulting practice (www.conversant.com), have developed two great tools for understanding conversation and stimulating valuable interaction: the Conversation Meter and the Intersection Model.