Which Comes First: Strategy or the Board?
By Darren Rawson
Darren Rawson is an active chair and director on six private company boards. He’s a former CEO of three different private companies and has done business internationally for over 25 years in numerous industry sectors.
Organizations frequently face a version of the classic chicken-or-egg dilemma: should a business recruit its ideal board of directors before defining its long-term strategy, or craft the strategy first and build the board around it?
Both perspectives hold weight, and choosing the wrong sequence can lead to misaligned leadership, wasted capital, and lost market momentum.
Scenario 1: The Board-First Approach (Let Governance Shape Strategy)
The board-first approach treats directors as active contributors to strategic thinking, rather than monitors of performance that make incremental improvements.
Under this philosophy, executive teams benefit immensely from institutional wisdom, experienced thinking, and industry networks long before committing talent and capital to a fixed strategic path. The benefit of stress testing the strategy with thinking partners on the board helps avoid costly rework or corrections as a result of changes to the strategy.
Key Advantages:
- Strategic Foresight: Seasoned board members bring macro-level market awareness, helping management identify emerging industry trends, regulatory hurdles, and operational risks before drafting rigid business plans.
- Navigating Risks: Established directors have seen a lot of movies and can bring a more independent perspective, and can help challenge management bias. Even a new board can help executives avoid bias and navigate risks to the strategic direction.
- Network and Resource Capital: Experienced directors open doors to key institutional investors, strategic partners, knowledgeable advisors, and top-tier executive talent, significantly expanding the company's realistic strategic possibilities.
The Core Risk:
Assembling a board before the strategic direction is clear can create gaps in expertise. If the organization’s strategy later shifts, the board may not have the skills or experience needed to support the new direction.
For example, a board assembled to support steady domestic growth may not have the expertise required if the organization later pursues international expansion, acquisitions or a large technology transformation. It may also be harder to adapt if directors are anchored to the assumptions or priorities that shaped the original strategic path.
Scenario 2: The Strategy-First Approach (Destination Dictates the Crew)
Advocates for a strategy-first approach argue that an organization needs to know where it is going before it can recruit the right directors. Under this model, strategy defines the destination and helps define the skills and experience needed in the boardroom. The board in this case plays a key role in supporting, challenging and monitoring the execution of the strategy.
Key Advantages:
- Precision Recruitment: A defined strategic direction such as expanding into biopharmaceuticals, entering emerging markets, or executing a complex digital transformation allows companies to recruit directors with hyper-specific, relevant expertise.
- Immediate Alignment: Directors recruited to support a defined strategic direction join with greater clarity on the company’s trajectory, reducing early friction over core objectives.
- Operational Agility: Management retains the early freedom to experiment, test hypotheses, and pivot quickly without navigating board committees or early bureaucratic resistance.
The Core Risk:
Drafting strategy without board-level insight risks insular thinking. Management teams can fall victim to internal biases or overlook capital constraints, regulatory hurdles or other risks that experienced directors may identify early. Incoming directors may also challenge key assumptions, or require major revisions to the strategy, making initial planning redundant. This could result in costly rework and slower implementation.
The Best of Both: A Hybrid Approach (An Iterative Governance Loop)
In practice, the answer is rarely either-or between the two scenarios. Resolving the chicken-or-egg paradox requires abandoning the idea that one must come before the other. The most successful organizations treat board evolution and strategic planning not as sequential steps, but as an ongoing, iterative loop.
Phase 1: Core Governance. Assemble a lean, foundational board focused on overarching governance, financial discipline, and broad strategic experience.
Phase 2: Collaborative Strategy. Work with this core board to pressure-test market assumptions, evaluate risks, and help shape the long-term strategic objectives.
Phase 3: Capability Gap Analysis. Map the agreed strategy against current board capabilities to identify specific gaps in industry knowledge, technology expertise, or geographic experience.
Phase 4: Targeted Expansion. Recruit directors with the specific expertise needed to support, challenge and oversee the strategic priorities. In some cases the strategy may require specialized experience in areas such as technology, M&A, regulation or international markets.
Phase 5: Continuous Refreshment. As strategy and market conditions evolve, refresh board committees and regularly reassess board composition to refresh skills where needed.
The Ongoing Balance
Ultimately, neither the board nor the strategy exists in isolation. Strategy informs the recruitment of specialized directors, while a sound board continuously shapes, sharpens, and elevates the strategy. Organizations that treat governance and strategic planning as dynamic, co-evolving partners build better resilience to navigate change and sustain long-term success.
High-performing boards recognize that the board composition is not static and that being a director is a privilege and not an entitlement. Strong directors recognize when their skills and experience may no longer be the right fit and are willing to step aside.
Getting the right winning strategy is a critical decision for an organization. So is having the right board to support, challenge and oversee it.
The greatest risk is allowing either the strategy or the board to remain static while the organization and its environment continue to evolve.
