Why do we sometimes see decisions from highly experienced boards of directors... decisions that seem "strange"?

I have always asked myself this question whenever a strange decision is announced—whether it is an acquisition deal, entering a new market, an investment, or a divestment.

Why do we sometimes see decisions from boards of directors with complete expertise... decisions that seem "strange"?

An acquisition that does not resemble the company, an expansion that swallows its focus, or a deal applauded by the board only to be punished by the market.

A Logical-Scientific Analysis of Decision-Making Mindsets Within Boards of Directors

Over time, I have reached a practical and scientific conviction:

The problem is not intelligence, nor is it resumes. The problem is usually in the type of mind that led the decision, and which minds were absent during the discussion and voting.

This is a logical attempt to deconstruct the nature of decision-making within a board through "types of mindsets" representing different disciplines.

A major decision cannot be judged from a single angle; because any single angle—no matter how correct—can lead to a wrong outcome if other angles are absent.

There are five (5) essential minds on a board of directors:

1) The Strategy Mind | Strategic Management

The function of this mind is not just to set a vision... but to protect the direction.

It is the one that asks the question many reject because it reveals the truth:

Where are we heading?

Then it adds an even harsher question:

Does this decision serve our direction, or does it distract the company?

Strategy within the board is not about justifying expansion; it is about filtering it. It is a mind that says "no" far more than it says "yes," because too many "yeses" guarantee distraction.

If a decision does not increase the company's focus, it decreases it—even if it looks like a great opportunity.

2) The Economics Mind | Economics and Resource Allocation

This mind does not care about how attractive an idea is; it cares about the question of scarcity:

What will we sacrifice in exchange for this decision?

It understands a simple rule: resources are limited, time is limited, and managerial attention is limited.

This is where the strangeness of many decisions becomes apparent:

• The board sees the opportunity but fails to see the sacrifice.
• It sees the expected return but fails to see the opportunity cost.

Consequently, decisions are treated as if they are free—which they never are. Any decision that does not account for its true price is an economically unvalued decision.

3) The Finance Mind | Corporate Finance and Risk Management

This mind refuses to be dazzled by numbers. It does not just ask, "How much will we make?" It asks:

Does this profit exceed the cost of capital?

Is this growth real, or is it fueled by debt?

Are the risks priced in, or left to chance?

Many strange acquisitions are approved because the profits look beautiful on paper, while the underlying quality is weak, the cash flow is unsupportive, or the risks are much higher than they appear.

Growth that does not exceed the cost of capital is growth that slowly consumes the company.

4) The Operations Mind | Execution and Operational Readiness

This mind quietly kills illusions. It asks the questions that enthusiasts dislike:

Who will execute this? When? And with what capabilities?

Then it asks the most critical question:

Is the organization mature enough to handle this level of complexity?

A decision may be strategically and financially sound, yet it fails because it is unexecutable within the company's current capabilities. This is precisely where decisions that onlookers describe as "strange" are born.

They are not actually strange; they are simply disconnected from operational reality. A decision without a realistic path to execution is not a decision—it is a costly wish.

5) The Governance Mind | Accountability and De-biasing

This mind protects the decision from human error, not just from the market. It actively monitors cognitive biases:

• Overconfidence.
• The urge to close a "big deal."
• The influence of prestige/authority.
• Groupthink (boardroom consensus that masks underlying hesitation or fear).

It asks:

Who is the true owner of this decision?

How will we measure its success?

When will we review it?

Where is the exit threshold if it turns out to be a mistake?

Many strange decisions pass because accountability is vague, or because reaching a consensus becomes the goal rather than uncovering the truth.

A decision without a clear owner and evaluation metrics is primed for failure, even if it succeeds temporarily.

The Non-Negotiable Conclusion

Strange decisions do not usually come from weak boards. They come from boards that allowed a single mind to lead a decision that required all five minds.

When this system breaks down, decisions look perfectly logical from the inside—but from the outside, they turn out to be costly, delayed, or strategically meaningless.

Mohammed bin Saleh

Interested in Management and Finance