5 ms·

Possibly the most incompetent board of directors in the past decade. Can't reign Travis in, couldn't avoid all of this by forcing Travis to get an adult COO lik

by kartD 9y ago

Possibly the most incompetent board of directors in the past decade. Can't reign Travis in, couldn't avoid all of this by forcing Travis to get an adult COO like Sandberg, fire him after he takes a break to mourn his moms death. They should all resign as well. A boards job is to reign in the CEO's bad tendencies. Really what have any of them accomplished by being on the board? Is there anything they can point to? And on top of all of that, their busy leaking news instead of picking a CEO...

sebleon 9y ago
> Really what have any of them accomplished by being on the board? They provided high-level guidance of a company that went from non-existent to $70Bn valuation in 7 years. I'd be very curious to know what boards you approve of.
- icebraining 9y ago
  Aren't most board members the same people who decided on that valuation, ie, the investors?
- throw2016 9y ago
  The same can be said of Travis if not more yet he is out. So why should the board remain?
  - kgwgk 9y ago
    Because the shareholders have not decided otherwise.
    - kgwgk 9y ago
      I don't usually argue with downvotes, but I'm going to make an exception. The board decided that a change of CEO was requiered. Who has the power to decide a change in the board is required? HN commenters?
      - calbear81 9y ago
        The shareholders who in this case are represented by the board members. In a public company, an activist investor can bring the votes and force a change in the board. Similarly, a majority investor could technically sway board members to vote out another member (as long as it's allowed in the bylaws)
        kgwgk 9y ago
        That was exactly my point. This piece by Matt Levine is relevant (https://www.bloomberg.com/view/articles/2017-04-24/board-votes-and-performance-reviews https://www.bloomberg.com/view/articles/2017-04-24/board-vot...): "On the other hand, you know, the buck has to stop somewhere. But where? The CEO is an obvious answer, and he is gone, but the buck is still moving. It might get the board. What's next? Should the shareholders fire themselves, for failing to catch the problem in time? There is a traditional model in which the board of directors represents the shareholders: When management messes up, the board gets angry on behalf of the shareholders; their dudgeon becomes its dudgeon. The modern model is increasingly that the board is identified with management: When management messes up, the shareholders get angry at the board; their dudgeon turns against the board. The modern model might be more accurate in describing the relationship between many boards and managements. But you want a balance between dudgeon and continuity. If the managers mess up and the board gets rid of them, it can demand that the new managers fix the problem, and hold them accountable for doing it. But if you get rid of the board too, then who stays around to make sure the problem gets fixed?"
dalbasal 9y ago
I guess the question is, what kind of competencies would one expect to find in a board. Board seats are typically filled by "money people." I think most boards have a good understanding of accounting, investment, fundraising... If they have founders, employees or specifically recruited outside managers they might have a good understanding of product or market strategies. But, managing crisis like this? In principle, boards can remove and replace CEOs but this is such a rare occurrence. There's no lower stakes equivalent to it. They don't have to remove and replace more junior managers. Competencies in an area you never touch on... in a scenario most board members have never seen... it would be a kind of fluke if they happened to be competent at this sort of task.
- DanBC 9y ago
  > I guess the question is, what kind of competencies would one expect to find in a board I've been looking into this in the context of English NHS Trusts. Here are a few things I've found useful. https://nhsproviders.org/media/1057/we-need-to-talk-about-boards-boards-leadership-and-the-nhs.pdf https://nhsproviders.org/media/1057/we-need-to-talk-about-bo... https://www.leadershipacademy.nhs.uk/resources/healthy-nhs-board/ https://www.leadershipacademy.nhs.uk/resources/healthy-nhs-b... Effective challenge on a unitary board: http://www.frontline-consultants.com/announcements/effective-challenge-on-a-unitary-board http://www.frontline-consultants.com/announcements/effective... There was quite a lot of work in the UK about effective boards after the Guinness scandal, among others.
mathattack 9y ago
For better or worse, they accepted investments with limited power to influence the company.
malandrew 9y ago
Incompetence is ousting the CEO that grew a company to $70B with no succession plan. FWIW, the only two boardmembers involved in the ousting were Benchmark and TPG. Let this be a warning to anyone ever considering either for a board seat.
InternetUser 9y ago
> A boards job is to reign in the CEO's bad tendencies. A board's job is to rein in the CEO's bad tendencies.

by kartD 9y ago

sebleon 9y ago

> Really what have any of them accomplished by being on the board? They provided high-level guidance of a company that went from non-existent to $70Bn valuation in 7 years. I'd be very curious to know what boards you approve of.

icebraining 9y ago
Aren't most board members the same people who decided on that valuation, ie, the investors?
throw2016 9y ago
The same can be said of Travis if not more yet he is out. So why should the board remain?
- kgwgk 9y ago
  Because the shareholders have not decided otherwise.
  - kgwgk 9y ago
    I don't usually argue with downvotes, but I'm going to make an exception. The board decided that a change of CEO was requiered. Who has the power to decide a change in the board is required? HN commenters?
    - calbear81 9y ago
      The shareholders who in this case are represented by the board members. In a public company, an activist investor can bring the votes and force a change in the board. Similarly, a majority investor could technically sway board members to vote out another member (as long as it's allowed in the bylaws)
      - kgwgk 9y ago
        That was exactly my point. This piece by Matt Levine is relevant (https://www.bloomberg.com/view/articles/2017-04-24/board-votes-and-performance-reviews https://www.bloomberg.com/view/articles/2017-04-24/board-vot...): "On the other hand, you know, the buck has to stop somewhere. But where? The CEO is an obvious answer, and he is gone, but the buck is still moving. It might get the board. What's next? Should the shareholders fire themselves, for failing to catch the problem in time? There is a traditional model in which the board of directors represents the shareholders: When management messes up, the board gets angry on behalf of the shareholders; their dudgeon becomes its dudgeon. The modern model is increasingly that the board is identified with management: When management messes up, the shareholders get angry at the board; their dudgeon turns against the board. The modern model might be more accurate in describing the relationship between many boards and managements. But you want a balance between dudgeon and continuity. If the managers mess up and the board gets rid of them, it can demand that the new managers fix the problem, and hold them accountable for doing it. But if you get rid of the board too, then who stays around to make sure the problem gets fixed?"

dalbasal 9y ago

I guess the question is, what kind of competencies would one expect to find in a board. Board seats are typically filled by "money people." I think most boards have a good understanding of accounting, investment, fundraising... If they have founders, employees or specifically recruited outside managers they might have a good understanding of product or market strategies. But, managing crisis like this? In principle, boards can remove and replace CEOs but this is such a rare occurrence. There's no lower stakes equivalent to it. They don't have to remove and replace more junior managers. Competencies in an area you never touch on... in a scenario most board members have never seen... it would be a kind of fluke if they happened to be competent at this sort of task.

DanBC 9y ago
> I guess the question is, what kind of competencies would one expect to find in a board I've been looking into this in the context of English NHS Trusts. Here are a few things I've found useful. https://nhsproviders.org/media/1057/we-need-to-talk-about-boards-boards-leadership-and-the-nhs.pdf https://nhsproviders.org/media/1057/we-need-to-talk-about-bo... https://www.leadershipacademy.nhs.uk/resources/healthy-nhs-board/ https://www.leadershipacademy.nhs.uk/resources/healthy-nhs-b... Effective challenge on a unitary board: http://www.frontline-consultants.com/announcements/effective-challenge-on-a-unitary-board http://www.frontline-consultants.com/announcements/effective... There was quite a lot of work in the UK about effective boards after the Guinness scandal, among others.

mathattack 9y ago

For better or worse, they accepted investments with limited power to influence the company.

malandrew 9y ago

Incompetence is ousting the CEO that grew a company to $70B with no succession plan. FWIW, the only two boardmembers involved in the ousting were Benchmark and TPG. Let this be a warning to anyone ever considering either for a board seat.

InternetUser 9y ago

> A boards job is to reign in the CEO's bad tendencies. A board's job is to rein in the CEO's bad tendencies.