FACT AND FRICTION
The accelerated rate of change in markets, technology development and associated consumer behaviour – much of which was driven by the pandemic – has challenged businesses to reinvent how they originate, commercialise and scale ideas.
However, there is an inherent potential conflict between ‘going digital’ and ‘traditional board governance’.
The typical governance framework (& many board members) often view digital and digital technologies as conflicting with their foundations. Historically governance had desired certainty, risk aversion and visibility. Traditionally board members are older with years of experiences aligned to analogue corporate ways of working; they are not ready made (or ready to accept) for digital.
In the Age of Digital Transformation, business leaders now have a set of new questions:
- What are the synergies between what digital can do and the role of governance in the boardroom?
- What are the board missing due to their lack of understanding of digital?
- Has the reliance on board members (in particular NED’s) whose experience is built on multiple historical board positions, become less relevant?
Digital thrives on fast-moving, test & learn and fail-fast methods. Often digital is combined with thoughts about new technology companies which thrive on disruption, change and innovation more broadly. These rubs up against the traditionally perceived role of governance the as a checks and balances mechanism, with leaders wanting control, predictability, assurances and known outcomes. Many boards are less well versed in digital approaches and parlance: they face what the former US Secretary of Defence, Donald Rumsfeld called ‘unknown unknowns’. In plain English, they don’t know what they don’t know.
The reality is the digital curve is evolving in months as opposed to decades, so today’s young digital natives are already ahead of experienced board members (even those who state they are ‘digital experts’). For this reason, any tension or conflict between digital and governance must be resolved quickly.
Continue reading here.
The accelerated rate of change in markets, technology development and associated consumer behaviour – much of which was driven by the pandemic – has challenged businesses to reinvent how they originate, commercialise and scale ideas.
However, there is an inherent potential conflict between ‘going digital’ and ‘traditional board governance’.
The typical governance framework (& many board members) often view digital and digital technologies as conflicting with their foundations. Historically governance had desired certainty, risk aversion and visibility. Traditionally board members are older with years of experiences aligned to analogue corporate ways of working; they are not ready made (or ready to accept) for digital.
In the Age of Digital Transformation, business leaders now have a set of new questions:
- What are the synergies between what digital can do and the role of governance in the boardroom?
- What are the board missing due to their lack of understanding of digital?
- Has the reliance on board members (in particular NED’s) whose experience is built on multiple historical board positions, become less relevant?
Digital thrives on fast-moving, test & learn and fail-fast methods. Often digital is combined with thoughts about new technology companies which thrive on disruption, change and innovation more broadly. These rubs up against the traditionally perceived role of governance the as a checks and balances mechanism, with leaders wanting control, predictability, assurances and known outcomes. Many boards are less well versed in digital approaches and parlance: they face what the former US Secretary of Defence, Donald Rumsfeld called ‘unknown unknowns’. In plain English, they don’t know what they don’t know.
The reality is the digital curve is evolving in months as opposed to decades, so today’s young digital natives are already ahead of experienced board members (even those who state they are ‘digital experts’). For this reason, any tension or conflict between digital and governance must be resolved quickly.
Continue reading here.
