John T. Montford - Board Games: Straight Talk for New Directors and Good Governance

Copyright 2016 by John T. Montford and Joseph Daniel McCool

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, except for the inclusion of brief quotations in a review, without prior permission in writing from the publisher.

Library of Congress Cataloging-in-Publication Data

Names: Montford, John T., 1943- author. | McCool, Joseph Daniel, author.

Title: Board games : straight talk for new directors and good governance / John T. Montford and Joseph Daniel McCool ; foreword by Herb Kelleher.

Description: Santa Barbara : Praeger, 2016. | Includes bibliographical references and index.

Identifiers: LCCN 2016003439 | ISBN 9781440842528 (hardback) | ISBN 9781440842535 (ebook)

Subjects: LCSH: Boards of directors. | Corporate governance. | Management.

Classification: LCC HD2745 .M68 2016 | DDC 658.4/22dc23

LC record available at https://lccn.loc.gov/2016003439

ISBN: 978-1-4408-4252-8

EISBN: 978-1-4408-4253-5

201918171612345

This book is also available as an eBook.

Praeger

An Imprint of ABC-CLIO, LLC

ABC-CLIO, LLC

130 Cremona Drive, P.O. Box 1911

Santa Barbara, California 93116-1911

www.abc-clio.com

This book is printed on acid-free paper

Manufactured in the United States of America

This book and any related digital or electronic forms are intended for educational and informational purposes only. The authors have made every reasonable effort to present accurate and up-to-date information in this book. However, neither the authors nor the publisher is engaged in rendering legal or accounting advice, and nothing in this book is intended to be or should be construed as such. If the reader deems such professional advice necessary or desirable, the reader is advised to consult with his or her own attorney, accountant, and/or other advisor regarding the specific situation in question. In addition, neither the authors nor the publisher assumes any responsibility for any errors or omissions. The authors and the publisher specifically disclaim any liability resulting from the use or application of the information contained in this book. This book contains references to federal law. In addition to federal law, the reader is advised that state laws would also apply in connection with his or her role as a director. This book is not intended to provide information on state laws, which vary by jurisdiction.

For Ford, Maylin, Anistin, and John Dylan

and

For Lindsay, Erin, Matthew, and Sean

Contents

Foreword

I have known John Montford for many decades, as a friend, member of the USMC, eminently successful lawyer, powerful political leader, important business leader, higher education leader, creative participant in numerous charitable endeavors, and superb member of the Board of Directors of Southwest Airlines. His variegated experience, tough-minded pragmatism, keen powers of analysis and concise explications, and his West Texas common sense are a unique adornment to any organization he joins. By virtue of this collaboration with John, I know Joseph McCool must be a thoughtful and effective leader as well.

Board Games is a compendium of knowledge and advice, traversing the entire spectrum of how you get invited to the party through how you should behave at the bar once you are there. With respect to its coverage of board directorships, of any kind, it is the equivalent of the Oxford English Dictionarys status with respect to coverage of the English language.

You dont have to agree with every single asseveration and with every atmospheric and tonality within the covers of Board Games to profit from its superabundance of nuggets. But if you have any interest, personal or purely intellectual, in the subject of directorships, Board Games is your mother lode for thinking about boards and how they should be constituted, function, and perform.

Board memberships are no longer merely a safe harbor for college fraternity brothers. Boards are under ever increasing media, regulatory, and shareholder scrutiny, and their work is essential to the continued efflorescence of the free enterprise, market economy in America; e.g., no, dont invest our companys cash in subprime mortgages!

John and Joseph, in Board Games, have produced a fundamental and provocative text that clearly shows that old-fashioned boards have gone the way of buckboard carriages, and I thank them for their seminal work.

Herb Kelleher, co-founder, Chairman Emeritus,
and former CEO, Southwest Airlines

Acknowledgments

A special thanks to my wife and confidante, Debbie Montford, for her keen insights on nonprofit boards; to my longtime executive assistant, Cappy Robnett, for all the countless hours of transcribing my draft pages; to John Keeton of Covenant Multi Family Organization, my financial advisers, for helping with corporate finance and balance sheets; to Herb Kelleher and Colleen Barrett for imparting a lifetime of good management techniques; to Vickie Shuler for finding Herb when we needed him; to Tom Pitcher for help on the Fleetwood story; to all my fellow directors on both corporate and nonprofits who have graduated from the school of hard knocks; and to Gaylord Armstrong for proofreading.

Other special thanks go to Mike Wheless, who introduced the co-authors based on his conviction that our unique insights and experience could help directors change the game of corporate governance. And also to the Honorable Dale W. Meyerrose, Major General, U.S. Air Force (Retired), one of the worlds leading experts on the cyber industry, whose views on data strategy, security, and more added real depth to this endeavor. And we would be remiss if we didnt also offer our profound thanks to Hilary Claggett, Senior Editor, Business, Economics & Finance at Praeger Publishing/ABC-CLIO, whose work and support also made this book possible.

We are further indebted to the late Dr. Tory Herring, the CEO of Leadership Partners. Torys example, partnership, and friendship, and later his untimely passing as we were finishing the manuscript for this book, deepened our resolve to reflect his lessons in humility, coaching, organization development, and what it means to lead a life well lived in these pages.

From his days playing football on scholarship at Georgia Tech, through his distinguished service flying helicopters in Vietnam with the unit featured in the movie Apocalypse Now, to earning two doctoral degrees in individual and group behavior and dynamics, racing with the Porsche club, and committing to his family, Tory set an amazing leadership example for us all. Combined, his life and professional work experience provided a realistic perspective on leadership and organization development and the capacity for relating to people at all levels of todays organizations with credibility, humility, and sincerity. In closing, as Dr. Herring reflected on his life, he said I have had many people give me a second chance and contribute to my success and want to do the same for others.

Introduction

Throughout my many jobsfrom the United States Marine Corps to election as a district attorney in Texas and later to the Texas Senate, later to appointment as chancellor of Texas Tech University System, as an executive at AT&T and consultant for General Motors, and now as an independent corporate director and public policy consultantI have had the privilege of serving on just about every kind of board imaginable.