• Re-engineering the Board

    Reengineering the boardHR directors must re-engineer the board of directors to both mitigate and capitalise upon an increasingly ‘crash’ prone global marketplace

    Many of the news events of the last two years and the damage done to company balance sheets and brands show that the traditional focus on financial, legal and accountancy qualifications and experience within UK company boards are not enough to avoid business disaster, according to SMF (Sainsbury Management Fellows’ Society). The organisation is urging HR directors to consider professional engineers with business qualifications and experience as an attractive complementary skill base for board director positions.

    The call comes as new research commissioned by SMF demonstrates a discrepancy between perception and recruitment reality when it comes to professional engineers’ recognition as board-level appointees and the lack of diversity in the viewpoints represented around the table that this brings.

    SMF believes that to increase the competitiveness of the UK economy more directors are needed in UK boardrooms that have the knowledge of how products are imagined, designed, made and work, combined with complementary business and management skills set within a global mindset. This will help drive organisations forward, maximising innovation and the opportunities of new markets while controlling and mitigating the inherent risks in rapid growth businesses.

    SMF has undertaken a survey among 100 FTSE250 HR directors to establish the level of awareness within the HR community of the suitability of engineers to fulfil these important roles. Results show that, while 86% surveyed were open-minded about employing directors with non-financial or legal backgrounds, only 66% believe that engineers have the skills and attributes necessary to move onto boards.
    “Our research shows a discrepancy between perception and recruitment reality,” says SMF President, David Falzani. “Over 250,000 engineers are employed in the UK, contributing to the
    economic strength of the nation and it is essential that organisations understand the benefits they can derive from having an engineer among its management team.”

    The SMF research goes on to reveal that while HR directors do acknowledge core competencies of engineers, including the ability to deal with complex issues (both financial and operational), to lead cross functional and cross geographical teams and to provide a rigorous yet balanced risk
    management and governance function, only half of the companies taking part in the survey have board directors with engineering backgrounds.

    Where engineers have MBA qualifications and business experience, HR directors surveyed felt reassured that engineers had the skills to move into the boardroom (80%).

    “Historically, engineers have not been seen as a natural choice to be members of boards of blue chip organisations,” explains David Falzani. “Conventional wisdom means candidates tend to come from financial and legal disciplines. However, HR directors are discovering that once engineers possess the requisite legal, financial, and marketing training, they have a breadth of skills that can be used to help organisations grow faster and more reliably.”

    Professional engineers, who by the very nature of their job are creative problems solvers are not seen as board material and are often lost to more forward thinking international organisations. HR directors can avoid this talent leakage by encouraging their professional engineers with leadership qualities to expand their existing skills by studying for a first class business education and degree qualification.

    “Up and down the country, the collective skills and experience of the boardroom are being analysed,” concludes David Falzani. Board directors have traditionally not been trained to manage the risk of failure positively by working with variables where mistakes, unknown consequences or side-effects might develop. These risk analysis skills are an integral part of the skill set of engineers and we are urging HR directors to reflect this when assessing the skills mix of their board.”

    SMF has produced a booklet for HR directors encouraging them to seek more information on the role of professional engineers in the corporate world. Within the booklet is a skills matrix to assist in the assessment of an organisation’s needs and how a business-qualified, professional engineer can enhance the board. Copies of the booklet are available from SMF.

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