What if They Held a Board Meeting and Nobody Came?
from
November/December 2002
by Mike Levine
Enjoy traveling these days? Neither do the French government officials who suggested that the ultimate board meeting—the G8 conference of world economic leaders—be held as a video conference. A virtual summit would save time and millions of dollars and, you know, eliminate those pesky egg-throwing protesters. And though this past summer’s meeting was eventually held face-to-face in Calgary, the notion that the gathering of the globe’s über-board could be proposed as a video conference speaks of the critical mass that virtual meetings are achieving.
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Would you hold a board meeting via the Internet? |
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Surveys Says
and 1.9%
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In the post-September 11 world of grinding travel conditions and corporate cost-cutting, more than nine out of 10 Fortune 500 companies now use some form of video conferencing. The president, the FBI, and the CIA all conduct even classified business by video. And yet this popular form of Internet conferencing is still plagued by the yeah, buts.
Yeah, but it’s expensive. Used to be, says Marc Beattie, senior analyst and partner at Wainhouse Research, a Brookline, Massachusetts, media research firm. Six years ago, he says, a typical client system cost $45,000. That same system today is about $7,500. The new IP (Internetprotocol) transmission system is about a fifth the cost of an ISDN network, and much more reliable. It can show an entire roomful of people and, with voice activation, zoom in on the person speaking. And it’s easy to hook a director in San Francisco to a board meeting inHouston.
All he has to do is walk into a videoconference room. Even Kinko’s has them. Many supplementary board meetings are already being held by phone; those, at least, would surely be enhanced by videoconferencing.
Yeah,but videoconferencing is not secure. Says who? A videoconference is as secure as a company’s data network, Internet connection, or phonelines. And that security can be enhanced with various levels ofencryption, all the way up to military-grade. “When I was at Hughes, we did a lot of videoconferencing on board matters,” says Malcolm R.Currie, former chairman and CEO of Hughes Aircraft and current chair and CEO of Currie Technologies Inc. “We were working on government contracts, so security was built in. But with any company, when you’re talking about a merger, for example, you always use code words anyway.”
No question, videoconferencing can be convenient for directors. Venture capitalist Betsy S. Atkins once went to a Kinko’s and attended ameeting of the Lucent board while on vacation. “And at WebMethods, where I’m a director, we have a group in California and a group in Virginia on the board,” she says. The entire board meets in person two or three times a year, but sometimes when a meeting is held on one coast,“those on the opposite coast attend via videoconference. You get the same compensation.”
Adds Atkins: “One thing that is going to drive more videoconferencing is that directors are being required to work harder. There will be more meetings.”
Yeah, but what about the value of face-to-face contact? That absolutely is anissue, along with a general fear that in the current corporate atmosphere, videoconferencing may be too casual for board meetings. In the Korn/Ferry International- Corporate Board Member poll, 63% of respondents said they would not feel comfortable at a virtual boardmeeting, even in a secure environment. The reason given by almost all of them was that face-to-face discussion is important. “To be able to interact with people that you have high regard for and think you can learn from—that is a valuable part of the board experience,” says Paul Walsh, a director of Staples.
Yeah, but hey, things change—and so do attitudes. In a few years, a generation of directors who’ve grown up with the Internet may feel lessof a need to bond in the flesh.
Unless, of course, the board decides that Calgary in the summer is too beautiful to miss.
