Wednesday, July 4, 2018

Building the “Three-D” Board to Lead Digitalization

With the fast speed of changes and exponential growth of information, the digital board needs to become three “D” - dynamic, diverse, and decisive.

Building a high-effective board is not an easy task because the board plays a crucial role to direct the business in the right direction by dealing with changes, uncertainty, and unknowns. Many BoDs are undereducated about their role and responsibility while the business change is accelerated across the global scope and knowledge life cycle is shortened significantly. For adapting to digital new normal, how to build a “three-D” board to advocate changes and ensure that the board becomes the mastermind behind the digital transformation?

Dynamic: Due to the complexity, uncertainty, ambiguity, and volatility of digital age, the directorship in any organization must have the ability to guide and steer organizations in the right direction, inspire and motivate management to reach a clear vision by achieving a set of well-defined business goals. The emerging digital era is dynamic; dynamism consists in being able to break away from the static, being proactive and informative. If you stick and restrict, you cannot be dynamic. A dynamic board has the further thinking view with an in-depth understanding of the digital new normal. The board of directors is open-minded to explore new opportunities and alternative ways to solve existing and emerging problems. They are fluent in digital dialect, have solid knowledge and expertise to advise, flexible attitude to changes, gain respect based on their expertise, and lead the organization forward effectively. Digital directorship is brave and driven, don’t just react to change or focus on compliance issues only, but proactively drive digitalization with a clarified vision and implementable strategy.

Diverse: The digital world is nonlinear and ambiguous, also multi-dimensional and diverse. One of the biggest challenges in this complex and multi-polar world is the fact that we need different perspectives, different knowledge, and different ways to solve problems. That starts at the board level. The board is responsible for ensuring an appropriate mix of skills, knowledge, and experience are present or available for it to fulfill its functions and responsibility. The board needs diversity, or even more crucially, cognitive difference. ”What can get lost in the profound understanding of the diversity is the fact that identifiable community sectors reflecting (say, gender, age, and ethnicity) themselves each encompass a wide range of diversity of thought. The board diversity being sought should be “diversity of thought," to provide a perspective for filling the multitude of gaps in board discussions. The board is composed of the BoDs with a cognitive difference, diverse background, capabilities, skills, and education. So they can provide different perspectives which will help to mitigate “group think” and enable the board better relating to their stakeholders. They need to incorporate their unique viewpoint on people, innovation, CSR etc, into their solid knowledge of overall business and technology.

Decisive: The corporate board oversees strategies and monitor business performance, they have to make decisions, especially at the strategic level all the time. The important issue is how the board accommodates diverse opinions and how they assess them and converge the diverse thoughts into wise decisions. Being decisive is both art and science. Digital board directors need to take consideration of the variety of information, and more complex data analysis—in the mix with intuition and experience, a mix that collectively makes up the art and science of decision-making. The high-effective board can make effective decisions in deliberation, moving the enterprise forward, scrutinize the management decisions as well, to ensure the organization makes sense and on the right track to achieve the business goals timely.

With the fast speed of changes and exponential growth of information, the digital board needs to become three “D” - dynamic, diverse, and decisive. As the corporate strategy, performance, talent, brand, culture, knowledge, and risk management are all boardroom concerns. Today and beyond, digital board directors need to be the digital gurus with the ability to balance resources, risks, and consequences, built on a foundation of integrity, welcome and embrace diverse thoughts, become both “experts” and “explorers,” to improve leadership effectiveness and amplify leadership influence.

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