Social distancing has had a significant impact on investment board meetings. Our clients are using unfamiliar technologies, trialing different ways of working, all of this at a time of financial market stress. It’s not been easy, but as the proverb says, ‘necessity is the mother of invention’.
It’s been a fascinating couple of months, thinking about the problems that the current environment creates and working with our clients on how we can solve them. One interesting challenge relates to communication – here are some thoughts that I put together with Alex Lindenberg about what we can learn, good and bad, from the world of cinema.
‘La La Land’ – the Oscar that never was
The Oscars of 2017 are often remembered not for what was won, but for one of the biggest goofs in the event’s history. This involved Faye Dunaway and Warren Beatty announcing ‘La La Land’ as the winner of the 2017 ‘Best Picture’ category. In fact, ‘Moonlight’ had won, which caused an unparalleled degree of embarrassment as the ‘La La Land’ entourage had to leave the stage as the mistake was brought to light.
The historical narrative has largely focused on human error, but it’s also about a lack of focus on key information. The full story is complex, but Dunaway and Beatty were given the wrong envelope. An envelope containing the details of the previous winner, Emma Stone, for ‘Best Actress’ (in La La Land). When Beatty opens the envelope, he’s perplexed. He pauses, he looks left and right, he checks the envelope and the card again in a manner that makes us wonder if he’s playing with us for dramatic effect. He’s not. He’s confused. Ultimately, he shows the card to Dunaway who quickly announces ‘La La Land’ as the winner.
Why the confusion? And what are the lessons for making good choices in the New Normal? First, here’s the card that Beatty and Dunaway would have seen*:
First, what’s the prominent image on the card? The Oscars – it’s nice branding but arguably superfluous information – even the most substance-addled celebrity knows where they are. Crucially in the context of this failure, what’s least visible? The category – ‘Best Actress’. In the heat of the moment neither Beatty nor Dunaway saw it. They were there to announce ‘Best Picture’ and whilst Beatty knows there’s something wrong, he doesn’t know what to do. In the pressure of the moment, Dunaway utters the information that she’s expecting to see. Cue the applause, the great and the good mounting the stage and then having to climb down again with dreams shattered and recriminations galore for the organisers.
This wouldn’t have happened if there had been more thoughtful design, perhaps more like this:
There would still have been a little embarrassment as the correct envelope was found, but nothing on the scale of what actually happened.
Lessons for the ‘New Normal’
We think that there are three pertinent issues for investment boards to think about :
1. Focusing on the most important things: In a virtual environment, meetings are generally shorter and attention spans lower. If we want people to make good choices in this context, we need to be even more focused on helping them understand the key issues and stripping out superfluous information.
This can be a challenge – there is some definite truth to the adage, ‘I would have written you a short letter, but I didn’t have time’. Whilst markets and strategies can be complex, they can be reduced to their key drivers provided you can juggle two key points that are often attributed to Albert Einstein:
‘If you can’t explain it simply, you don’t understand it well enough.’ It’s an obvious point, but to explain something simply you really do need to understand it well.
‘Make everything as simple as possible, but not simpler.’ A potential risk of the simplification process is that too much relevant detail is stripped out. This might leave you with an understandable story that doesn’t match-up to reality.
Help from the movies
The approach that we use to try and manage these challenges is ‘storyboarding’. A storyboard is a technique used by film directors to help them visualise how a scene will play out. Importantly, the process makes a director go through the shot step by step, which can highlight potential problems that might arise, thus saving time and money on the actual shoot. This approach can prove incredibly valuable in seeing whether an explanation is clear, accurate and appropriately concise.
2. Thinking about the tech: Almost all of our clients’ meetings are now being run on technology such as Microsoft Teams and Zoom. An important element of this tech is the ability to share screens. As a long-term user of Teams, one of the things that we noticed early on is that the image quality of shared screen can sometimes be lower than a more traditional electronic board pack.
This can be problematic when using charts or visual tools that have a lot of complexity. This means that particular focus needs to be given to what visual material is used. We have therefore, where appropriate, reduced the complexity of certain charts and slides. Where this is not possible, we ensure that we pay particular attention to where information might be less visible to the end user. In our experience, this helps bring greater understanding and reduces the risk of something being inadvertently missed.
3. The human element: If you’ve watched the video, you can see that Beatty knows something isn’t right, but doesn’t know what to do about it.
We’ve written on numerous occasions about the importance of Psychological Safety for successful team decision-making. The ability to put your hand up and say that ‘I don’t understand’ is crucial for harnessing the strength of a team and ensuring that gaps aren’t missed. Maybe in front of an audience of millions, that would always be hard for Warren Beatty – it really shouldn’t be the case for an investment board that works together regularly.
Irrespective of the level of a board’s Psychological Safety, in a physical meeting, any good adviser or Chair will constantly scan the room looking for non-verbal cues that people aren’t understanding things. This is far tougher in a virtual environment. There are two simple things that groups can do to resolve this.
First, highlight the problem so that everybody is aware of it and reiterate the need for people to call out issues.
Second, if the Chair or adviser can’t pick up on the subtle cues that they normally look for, they should have simple explicit tools and techniques to mitigate this. This can involve the technology. For example, some tools have a virtual ‘raise a hand’ facility that everyone should be made aware of and encouraged to use.
It is also worth introducing more formal checking procedures at different points of a discussion. For example, after a complex point has been made, it can be valuable to ‘check-in’ with the board for understanding. We’d suggest the use of open questions to maximise participation, for example, ‘What else might we need to know to explain this to members or the sponsor?’ We’d also suggest starting the discussion with those who might have least expertise. This reduces the risk of an ‘information cascade’.
One of the few silver linings of the current crisis is that it makes us re-examine how we work and how we can make high-quality decisions in this new environment. Stripping away superfluous information and focusing on the most important issues is a good place to start.
But no matter how well-crafted we might think a message is, it’s always vital to check for understanding. Technology can make this harder, but used thoughtfully we can manage most of the challenges it creates.
As always, we know that we don’t have all the answers, feel free to comment on the challenges that you are seeing and the solutions that you are using.
* this was created by Benjamin Bannister based on the design of the card for Moonlight shown to prove that it had won.