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Column

Kent Thiry
Chairman and CEO
DaVita Inc.

The Airtime Metric
Here is a powerful tactic to make sure you get full input from all your board members — not just the most talkative ones.

By Kent Thiry

From my experience, most directors come to board meetings with two sincere objectives: (1) to add value, and (2) to not be bored.

Unfortunately, in one of life’s great ironies, management often comes to the board meetings with two relatively contradictory objectives, namely: (1) to demonstrate that they have already thought of everything, and (2) to demonstrate how much that is.

Therefore, I coach new CEOs to demonstrate their self-confidence by going to the edge of business issues, openly bringing up the unanswered questions, and letting the board opine. If at least 40% of the total board time is not a general and engaged discussion, as opposed to directors listening to presentations, you are at serious risk of getting far less value because the directors go numb in their chairs.

Here is one of the “simplest” and most self-evident ideas you could imagine. I only wish someone had brought it up to me years earlier, as I have been struck by its power.

‘I Began the Following Practice’

By way of context, every single board I have sat on had a subset of the members who did most of the talking. Furthermore, on many issues, a couple directors would do most of the talking, someone would venture forth with a conclusion, some heads would nod (or at least not object), and the discussion would move on.

Therefore, I began the following practice: A couple of times at a board meeting, after there has been some give and take on an important issue, I will ask for us to go around the room and have every director speak, and sometimes each executive as well — even if it seems like there is a directional consensus.

The consistent result is that we get some of the most insightful comments of the entire meeting.

These are comments that would otherwise have never been made, because people did not want to fight for airtime, or they were worried it would prolong the conversation forever, or because while it was a value-added comment it would not directionally challenge the answer — all sensible reasons to hold back from throwing in another comment.

Knowing You Will Get Your Turn

But for an important topic, these synthetic closing thoughts, provoked by the extensive conversation that preceded them, are often the most valuable.

Since each director knows they will get their turn, there is no need to rush — quite the contrary, they know the whole point is to reflect on the entirety of the issue. Some will link our direction to other big issues, some will tie it to history, some will point out organizational issues it raises, some will point to capital market or implementation issues, while others point out optical issues.

Whatever it may be, the aggregate result is every director becomes engaged by providing thoughtful closing comments on an important issue, with the rest of the board as their undivided audience.

Kent Thiry is chairman and CEO of DaVita Inc., an NYSE company that is the largest independent provider of dialysis services in the United States for patients suffering from chronic kidney failure. He led a turnaround of DaVita (Latin for “he/she gives life”) from near bankruptcy to a Fortune 500 company with over $5 billion in revenue.

He is a frequent speaker about the DaVita management philosophy, which has been discussed in various forums, including a Stanford Business School case study.

This is an excerpt from Mr. Thiry’s longer article, titled “Powerful Tactics to Power Up Your Board,” that appeared in the First Quarter 2009 edition of Directors & Boards. Click here for a copy.