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LETTER
September 20X3
Tony Bursham
CEO Yexamarine
Neoland
Dear Tony
Subject: Strategy committee
This letter assesses your proposal to establish a strategy committee.
It definitely makes sense to establish a strategy committee as a board sub- committee since your
company will be facing several strategical decisions regarding your products and markets over the
coming few years.
The following are the advantages of establishing a strategy committee:
More specialized
The members propsed by you for the strategy committee are the technology director and the
operations director including yourself . Each director's specialization will enable your company to
make better strategical decisions leading to long term growth.
More focused
A committee established just for strategic decision making implies that their major focus would be
on decision making including evaluating the impacts of several decisions before setlling on one.
Since you have clearly defined the roles to be carried out by the committee, they would be focusing
on the same.
More time
A seperate committee for strategy decisions can help your company to allocate more time for
strategical decisions. Decisions relating to long term strategies should be clearly evaluated,
assessed and selected with careful consideration. Establishment of strategy committee would
enable the same.
Frees up board time
The board headed by you has several issues to focus on. Establishment of a strategy committee
could free up some of your time and this time could be effectively utilised to discuss and
communicate amongst the board regarding other key issues faced by your company.
Higher shareholder confidence
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A seperate committee to regarding strategies will ensure the shareholders that any decision which
would impact your company in the long term will be taken only with careful consideration. Such
precise decision making will increase the confidence of your shareholders.
However, I have noticed some problems in your proposal which includes:
No NED involvement
As per the best corporate government practices, it is advisable to have NEDs in your proposed
strategy committee. They would not only challenge your decisions until the best option is chosen,
but will also provide opinions from a fresh pair of eyes regarding any situation.
Frequence of committee meetings
You have not defined the frequence of committee meetings in your propsale. If this is not clearly
defined, the committee might not conduct meetings regularly and undertake discussions which
beats the ultimate purpose of having a strategy committee.
No finance director
The finance director is not amongst the proposed members of the committee. All strategical
decision will have some kind of financial effect and to understand this in depth, also to ensure
financial feasibility of any strategic option, it would be essential to have finance director onboard.
Please feel free to contact me if you need any further discussions
Best regards
Tranart Consultants
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