Saturday, January 28, 2017

The Best-in-Class Digital Board

The best in class board think differently and lead innovatively.

Corporate board as the top leadership team plays a significant role in business advising, leadership exemplarity, policy setting, and governance practices. How to build a best-in-class digital board? Is there any way for shareholders and key stakeholders to evaluate board leadership effectiveness?

Think differently: Critical thinking, independent thinking, strategic thinking, and innovative thinking, etc., are all important thinking capabilities for the digital BoDs because leading forward at today’s “VUCA” normality is truly not an easy task, there are many blind spots clouding the vision and there are numerous roadblocks and hidden pitfalls on the way. Hence, the board needs diversity, or even more crucially, cognitive difference, to provide a perspective that goes beyond the gaps in board discussion and brainstorming. Whereas what interested in the BoD is mindfulness. The different perspectives will help mitigate “groupthink” and can enable the board better relating to their stakeholders. Appreciates that the value of alternative perspectives and insights which say nothing of not trusting, simply looking from a different stance, and asking different questions. It is not as simple as looking at diversity at the skin level. From the business case standpoint, candidates from diverse groups don’t necessarily always bring a different perspective. The non-executive members should be selected for their ability to ask tough questions, share unique insight and willingness to constructively challenge management and this is less likely to happen if they are related to, or are close pals of, the executive members. They need to incorporate their unique viewpoint on people, innovation, CSR, etc., into their solid knowledge of overall business and technology. Until then, they will be seen as the 'diversity' contributor- the ones who fill in the gaps via thinking differently. To put simply, the best-in-class digital board will not think the same, but think differently, and becomes the mastermind behind the digital transformation.

Lead innovatively: Digital is the age of innovation. No longer are boards sitting in a room and just voting on various policies, to focus on compliance only, performance is another boardroom focus for leading digital transformation. In order to build the best-in-class-digital board, the Board of directors should be proactive innovators and interactive change agents that represent the organization, stockholders, and senior management. BoDs should participate, or even lead in the area of innovation from outliers’ viewpoint. Innovation is too important to leave solely in the hands of the management team without any oversight or guidance. It is one of the requirements of the board members to participate, or even lead, in constantly suggesting areas of innovation. Management innovation means to accelerate innovation at the multitude of levels, to create the space for dialogue and debate about why it is important for their organization, developing a common understanding of it, creating the necessity and motivation for it. The board should also ask how the enterprise measures innovations and how it compares to the best in class performance and be sure the measurements are accurate from the eyes of the customers and their constituencies.

Drive digital transformation relentlessly: The digital journey for organizations today is unstoppable in order to reach the vision and build the business’s long-term advantage. The business speed can only be accelerated with a clear vision, strong focus, and distinctive capabilities. The best-in-class board is further thinking with an in-depth understanding of the digital dynamic. BoDs are also in a unique position to practice out-of-thinking to bring a broader perspective to complement the management’s possible “tunnel vision.” They should set principles, develop the best and next practices, to drive digital transformation relentlessly. The intention is to enable an inclusive digital leadership culture at all levels across the organizations for clearing the path and taking a digital leap confidently.

The best in class board think differently and lead innovatively. The important issue is how the board accommodates diverse opinions and how they assess them and converge the diverse thought into wise decisions. The best-in-class board also practices scientific disciplines based on logic and rationalization with the artistic touch through emotion/inspiration in order to steer the enterprise ship in such a complex and ambiguous digital business dynamic to expedite changes and accelerate digital transformation.


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