“It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change.”
Board Chairs and Directors are committed to the oversight of their organisations in order to achieve effective performance and sustainability. While the challenges of achieving this are various and multiple there is one stand-out challenge which requires the organisation to be aware, agile, change focused and brave. Namely the challenge of Technology-Digital transformation.
In the non-too distant past Boards and Businesses had a decade to change their approaches while absorbing and adapting to a changing technological environment. Today the speed and dynamics of innovation happen in the blink of an eye.
This requires Boards to be focused on their own agility, forward-thinking, and capability to drive organisational success. In the many and regular surveys of Board challenges, Technology-Digital change is at the forefront of the Board mindset and while other challenges wax and wane it stays prominent and constant. Everyone knows the threat, but few Boards are really preparing the Business to achieve success in a volatile and dynamic landscape. Typically a Board will oversee underwhelming transformational planning and inadequate funding to achieve progress, with only a 30-40% success rate of actually achieving the transformational goals.
I am reminded of a trip to the Tower Bridge museum, which has a wall of plaques from the foremost global engineering companies in the era the Bridge was built, I struggled to recognise any as survivors today.
So how should a Board get itself into a position to dominate and drive change through Technology-Digital innovation and not just be buffeted by every wisp of change that is a constant companion of today’s Businesses? While this is no easy journey, it is critical to navigate positively. No where has the adage of ‘a stich in time save nine’ been more appropriate. When you are in the eye of the Technology-Digital storm it is difficult to think clearly and gain much needed perspective. Having lived through the ‘Dotcom’ hurricane of the late 90’s early 20’s and coached senior Executives and Directors who saw their experience and expertise evaporating before their eyes, my perspective is of a need to surf the waves of technology as an experienced Executive whilst using insight and strategic perspective, to prepare Businesses to be agile, quick and schooled to change.
This means preparing Boards to accept the speed of change and volatility of markets as it will be critical to their effectiveness in navigating today's complex Business environments. Boards need to reflect much more on their own learning and educational needs. Staying up to date with the latest trends, technologies, and market dynamics with regular training sessions on emerging technology risks and opportunities such as cybersecurity, AI, Blockchains and Data analysis. The question they should ask themselves is how they keep informed about disruptions, innovations and shifting market heading their way, using conferences and professional networks to develop their knowledge and gain fresh insights. The ability of the Board to sponsor and fund innovations which are focused on the future is a key attribute of the effective Board, such as University Committee participation and understanding where the cutting edge of their Business technology is heading. No longer is it appropriate to be conservative and avoid the ‘bleeding’ edge of technology, but more to be able to dance at the technology edge so you know where it is.
This requires a Diverse and Multi-Skilled Board, able to handle rapid change, diverse not only in demographics but also in skillsets. The recruitment of Directors with expertise in Technology, Digital Transformation, Risk Management, and Innovation is important. Yet it is also crucial for Boards to have the capability and experience of the wider Business Sector, to provide Strategic Thinking with insight and foresight. Equally, Boards need experience of navigating dynamic or disruptive markets and how to adapt to changing Business models. The Board is not expected to second guess the Technological-Digital challenges, but to understand the need for investment in the organisation, culture and expertise of the Business to achieve agility and rapidly response to changing circumstances. Ensuring there is a core team within the organisation monitoring, understanding and leading the innovation in Technology-Digital change for their Businesses sector.
The traditional structures of Boards are no longer fit for purpose and each Board should evaluate what they need to meet their specific circumstances and situation. This means agile decision-making to overcome traditional structures which perhaps are slow to react to fast-changing market conditions. The Board may need to adapt to shorter decision cycles with regular, focused Board meetings, and shorter meeting agendas. We see that Boards are responding with the increased use of more flexible Board structures such as ad hoc Committees, Advisory Committees or task forces which respond quickly to specific challenges or opportunities. The recent responses to the Covid crisis saw many good practices developed, and the bests element of the Board’s responsiveness need to be captured and enhanced avoiding just falling back on the ‘old ways.’
The information structures for the Board need to be revolutionised taking advantage of the Data and AI advancements to provide Boards with real-time data and dashboards for effective decision-making, ensuring Directors have up-to-date insights to guide Strategy. This data advancement should support Boards to understand dynamic markets and to think beyond the present, exploring future possibilities and the impacts on the Company. This should enable a deep dive into key risk areas both external and within the Company, with contingency planning for sudden shifts in market conditions, supply chains, or customer behaviours.
After 30 years of Board and Organisational consulting I have become numb to the shock of Businesses attempting to do change and achieve plans for which they have no history, no underpinning and no experience. Experienced NED’s have a real edge in supporting the Business to anticipate and think through the real challenges of achieving change, speed and agility. A Strategic Board keeps pace with change, using their deep insight to Businesses and Sectors to provide informed Strategic foresight with dynamic Board discussions and debate. NEDs should be experienced enough to avoid the traps of complacency. How often did we hear “PC’s will never overtake Mainframes”, “this on-line thing will never catch on”, “don’t understand Blockchains”, driverless cars? the meta sphere?
At the same time the Board needs to foster an effective partnership, trust and collaboration with the Executive leadership to stay aligned on emerging risks and opportunities. The Board is there to act as a sounding board, providing oversight while allowing flexibility for management to act quickly, fostering a united front in response to market shifts. One of the toughest challenge for the Board is to encourage and support a culture of adaptability within the organisation ahead of any potential crisis. We have all known the trauma, sometimes fatal, of organisations going through unforeseen change on a burning deck to ensure its survival. While not everything can be foreseen the ability to be agile, adaptable and resilient can be embedded into the organisation’s culture giving it a better chance to adapt, survive and grow.
By critiquing and looking at itself a Board can become more agile, future-ready, and equipped to guide the organisations through the complexities of today’s fast-moving, innovative and unpredictable markets.
“In Today’s era of volatility, there is no other way but to re-invent. The only sustainable advantage you can have over others is agility, that’s it. Because nothing else is sustainable, everything else you create somebody else will replicate. ”
