Advance the digital savviness of the board

A recent MIT Sloan report shows digital competence within the board helps longterm success. The respondents consider innovation and strategy to be closely tied with digital savviness, both areas needed to survive. As we work with nominating committees to assess what they need and how to find it, we hear requests of digital experts but they often come up short when asked to define this need for their particular situation.

Nominating committees have become much more specific over the last few years and the overall digital competence has gone up within boards which helps. But there is still a long way to go. Here in the north of Europe we often have a reputation of being innovative and early adopters when it comes to the digital domain. Unfortunately we don’t see this reflected in the boards of well-established, larger companies. So to sit back and relax, thinking you stay ahead of the curve by being in a new-tech environment will not cut it.

We see a tendency to look for a digital expert and trusting that person will cover all digital matters. The MIT Sloan report shows us that three digitally-savvy members on a board is needed in order to see any actual effect of having digital competence on the board. As we know from looking at what offers a true effect from diversity work, it seems to be similar, one or two representatives easily get lost in the masses. Valuable contrasting perspectives are easily muzzled when voiced by too few.

Increase the number of digitally savvy people

In the Harvey Nash/KPMG 2019 CIO survey report we could see that fewer CIOs now work in the board - dropping from 71 per cent to 58 per cent in two years. At the same time this report shows us that almost half of the respondents (3,600 CIOs or technology executives across 108 countries) expect to change their product/service offering or business model fundamentally in the next three years. Furthermore, in our newly released Alumni report surveying Nordic leaders we could see that 6 out of 10 of the respondents in leading positions defined their market as highly competitive. With disruption due to digitalisation as a dark cloud over the heads of many established organisations, how can you make sure your board has a good understanding of what this really means?

As we see a greater need for people with digital experience, we see less of these experts having a seat at the table. How can their influence still increase? Maybe some of these boards have seen the solution is not in the magical number of three experts but rather level the digital generalist competence? As Alumni consultant Heikki Otsolampi wrote in an article earlier this year (Don’t look for digital experts, look for digital generalists) the digital competence is growing integral to the business. In a few years we might view today's digital experts the same way we now view the old Chief Electrical Officer. Many organisations would struggle to find a part of their business not in someway infected with the digital evolution.

Who is that digital savvy person?

For some, however, a good start can definitely be to invite people with experience from digital responsibility to heighten the level of understanding within the board. At the Alumni Board Readiness Program we help people be more confident in a board member role. We see a lot of experienced and talented experts of all kinds improving how they contribute to the commercial success of a company. Just remember there is no such thing as a “digital competence” to cover all strategic analyses needed to stay aligned with, or indeed ahead of, the times. It can be beneficial to elect someone who has worked more with strategic business matters but in a very digital industry. And even these profiles come in a vast variety of competences.

You need to have a good idea of what you are looking for when expanding the digital competence within your board. Are you in a business threatened by disruption? Do you need a way to navigate the new technology to make sure you implement the right tools that will really make a difference for the company's survival rather than wasting resources on the latest buzz? Or is your offering falling way behind competitors due to faster and more personalized service thanks to them having a great strategy for data accumulation and analysis? Or perhaps there is a need to take a hard look at production and how automatisation can help you stay on top of things in your industry?

Meet the technology experts half way

Having that crucial digital competence really pays off when playing the long game. Digital in the board is not necessarily being savvy and updated with the trendy tools but being able to look at what opportunities and threats might come with emerging technologies. By having an understanding the board can ask the hard questions, twist and turn the dictations from practical to strategic. By not having this competence at hand, you leave an enormous amount of strategic decisions over to the IT department who might not, possibly rightfully so, have their focus on the overall business strategy. This gap is huge in some companies we meet, leading to policy making without insight, but also operations not serving the strategic purpose. A mutual understanding of limitations and goals will bring out the best of the digital aspects of the company.

The solution doesn’t need to be you and your fellow board colleagues taking a JavaScript-course and going knee deep in code in order to stay in the know. Start by wrapping your head around concepts and how other industries and companies utilise the digital possibilities.

Get started towards a digital board room.

Look around. You probably have a lot of experts in different areas within your company. Ask them to come and share their insights and predictions.
Invite external guests to come and share knowledge and how to’s. If nothing else this will prove the very vast variety of digital experts out there.
Take a classic field trip to another organisation. They don’t have to operate within your line of business to be a valuable source of information on how to use digital methods.

Google at the cutting edge, even when it comes to digital boards

We recently talked to the Swedish Country Manager of Google, Anna Wikland, who has initiated a network of board professionals with the agenda to broaden the frame of reference. This seminar series is divided over different modules covering a year. It has been very well received and appreciated. And it goes to show, there are a lot of board professionals looking to learn and excel in the new digital possibilities. Because they know, it pays to have a digitally savvy board.