You Make the Call-Situation 3

Essay

You Make the Call-Situation 3
For years, a small distributor of welding materials had followed the practice of most small firms, treating the board of directors as merely a legal necessity. Composed of two co-owners and a retired steel company executive, the board was not a working board. But the company, run informally with traditional management methods, was profitable.
After attending a seminar, the majority owner decided that a board might be useful for more than legal or cosmetic purposes. Thus, he invited two outsiders-both division heads of larger corporations-to join the board. This brought the membership of the board to five. The majority owner believed the new members would be helpful in opening up the business to new ideas.