How cognitive diversity and thinking preferences can transform board dynamics and effectiveness.
The challenge: human judgement in an accelerating world
As we enter what the World Economic Forum calls the “Intelligent Age,”[1] boards face unprecedented complexity. Artificial intelligence systems make millions of decisions per second. Stakeholder and regulatory expectations are changing rapidly. In this
environment of constant disruption, one thing is becoming clearer than ever: the human dimension of governance matters more, not less.
This means that high-performing boards will require more than directors with technical expertise – they will also need a high degree of ‘people literacy.’ Effective boards will also require a sharper focus on:
- board dynamics including the relationship between directors
- the relationship between board and management, and
- a boardroom environment which encourages courageous questioning and constructive challenge.
There are a range of factors that affect board dynamics and relationships. Some boards will have power dynamics that lead to a small number of directors dominating discussions. Others risk groupthink if they have collaborative cultures that can inadvertently suppress diverse thinking styles and perspectives in decision-making. However, when appropriately managed, constructive tension and robust dialogue are integral to boardroom dynamics and improved decision-making.
The Governing for Performance® framework: A human-centered approach
Directors Australia’s proprietary Governing for Performance® framework provides a human-centered approach to support the exercise of human judgement within governance systems and processes. This framework recognises that effective governance operates across multiple interconnected dimensions that start with purpose, strategy and culture at the centre.
“The Governing for Performance® framework was developed 8 years ago to help boards navigate complex and dynamic strategic environments – exactly what we face in the Intelligent Age. It emphasises that boards as a collective of directors need clarity on their purpose, desired culture, and strategy to exercise effective judgment.”
Kerryn Newton, CEO Directors Australia
This human-centered approach acknowledges that as technology systems become more intelligent, governance paradoxically needs to become more human and purpose-led.
It provides boards with a framework to measure their board culture and performance in an environment where generative AI will amplify human capability and human judgement faster than we have ever seen before.
HBDI® and board dynamics: the power of harnessing cognitive diversity
To best meet the challenges of the Intelligent Age, boards need thinking agility among their directors and must ensure that cognitive diversity, rather than groupthink, drives decision-making. Directors Australia uses the Hermann Brain Dominance Instrument (HBDI®) based on the Whole Brain Thinking® model to support boards in understanding director and executive thinking preferences at both individual and group levels.
The HBDI® framework measures preferences across the four quadrants of thinking in the Whole Brain Thinking® model. The HBDI® has been taken by more than 4 million people in more than 60 countries worldwide.[2]
Crucially, the HBDI® focuses on thinking preferences, while other assessments focus on behaviour, personality, or psychological type. This focus on thinking preferences makes HBDI® particularly suitable for governance contexts where decision-making processes are paramount.
An understanding of Whole Brain Thinking® also provides a common language for boards to navigate different communication styles and decision-making preferences in a constructive way.
Directors Australia works with our clients to improve their board dynamics and operating model, drawing on an understanding of individual and collective thinking preferences.
Directors Australia’s approach to leveraging cognitive diversity in the boardroom
Our service offering utilises the HBDI® through a comprehensive four stage approach:
1. Measure Whole Brain Thinking for each director using the HBDI® survey so that they understand their personal thinking preferences and decision-making style
2. Prepare a collective board thinking preference map to understand the distribution of thinking preferences and impact on discussions and decision-making
3. Facilitated discussion
Using the collective profile alongside our extensive knowledge of effective board dynamics, we facilitate a workshop with the board (and in some cases, management teams) to identify ways to improve board dynamics and decision-making.
4. Practical implementation
Following the workshop, we provide a brief report with practical actions agreed at the workshop to improve dynamics, performance, and decision-making across the board and with the CEO and executive team.
Our HBDI® service offering can also be incorporated into a comprehensive board performance evaluation based on all eight dimensions of our Governing for Performance® framework.
Conclusion: The future of governance
As we navigate the Intelligent Age, boards that systematically understand and focus on the human dimension of governance will be better prepared for what the future holds. In our experience, a focus on effective board dynamics will enhance collaboration, reduce groupthink, and facilitate more effective communication and decision-making. We work with our clients to design the best-fit approach to drawing out the human dimension of governance including through: facilitating board performance reviews and director appraisals, undertaking board dynamics and culture reviews, supporting boards to develop board operating models, facilitating board and management relationship workshops, and assessing board composition. We can incorporate the HBDI® thinking preference tools into our approach to support boards who are looking for a common language and third-party diagnostic to better leverage the cognitive diversity around the boardroom table.
“Directors Australia completed a profile evaluation of our executive and board teams using the HBDI® toolset. The insights that this work gave to both cohorts – at an individual level, immediate team level and organisational level – have been invaluable.
Critically, it has started a conversation that has improved understanding, enhanced trust and created a foundation for ongoing, deeper communications – all of which improve our collective effectiveness and individual fulfilment in prosecuting [our] important mission.”
Chair, Large national for-purpose organisation
Directors Australia is a leading national board advisory and non-executive director recruitment firm, delivering organisations the right people, insights, and strategies to govern effectively. We work with boards of private, government, publicly listed, and not-for-profit organisations to improve board and organisational performance through strategy, governance systems and practices, board composition, director remuneration, and risk. At the heart of our approach is our proprietary Governing for Performance® framework – a practical, evidence-based model that supports boards in navigating complex strategic environments and meeting contemporary expectations of governance. Our value lies in delivering real, ‘best fit’ corporate governance tailored to each organisation’s nature and
needs.
Contact us at [email protected] or 1300 890 267 to learn more.
[1] https://www.weforum.org/stories/2024/09/the-intelligent-age-a-time-of-cooperation/
[2] Herrmann International website
Kerryn Newton
Chief Executive Officer
Kerryn is the CEO of Directors Australia, advising boards nationally on governance strategy, risk and performance. With over 30 years' experience at board and executive level and as a nationally recognised trusted advisor to boards, Kerryn brings deep insight into board-management dynamics. A Fellow of the AICD and the Governance Institute of Australia, Kerryn is a committed advocate for improving governance practices across Australia. She is also a regular media commentator and speaker, known as "The Board Whisperer", on governance and board-related topics.
Geraldine Chin Moody
Board and Governance Principal
Geraldine has held senior roles in strategy, operations and people and
culture across ASX-listed companies and professional services firms.
She has served as a Board Chair and non-executive director across a
range of sectors. Drawing on her professional work experience and her
coaching psychology background, Geraldine is passionate about working
with boards and directors to enhance their performance, dynamics and
relationships with management.
