Tuesday, January 17, 2017

The Further-Looking Board

The digital BoD leadership needs to be future-oriented and further looking, with a clear business vision and a collective and broad range of business perspectives.

The digital enterprise consists of an amalgam of socio-systems, techno-systems, bio-systems, and Econo-systems. BoDs as the top business advisor role need to have sufficient knowledge to understand the business ecosystem and sense that the digital transformation is multifaceted; they should have the business vision to predict the emergent trend of business, technology or industry. Therefore, to make the role highly effective, digital BoDs not only need to be forward-thinking, but they also have to be further looking, thinking longer term, guide the executive team toward the right direction and play the management advising role effortlessly.

The further-looking board helps to set digital principles and ensure the enterprise has an appropriate business architecture: The digital business ecosystem is dynamic, nonlinear, and complex, the Board is accountable for the organizational structure and functional design and is responsible for ensuring that the enterprise has an appropriate business architecture. Contribution to the business strategy and business change agenda are the two places where the most value can be added by BoDs, and at the earliest stages of the cycle, thereby reducing the investment necessary to realize greater enterprise outcomes or earlier realization of enterprise aspirations. The digital principles as a compass will guide all levels of the organization to operate more like the human body operates with the cells (employees) and organs (Functions) of the organization being able to make a decision in a very organic relationship with its dynamic environment. The overall speaking, trans or interdisciplinary approach can be applied to the management with integrated multi-disciplinary methodology and approach problems via multi-facet way technically, scientifically and culturally.

The further-looking board will ask tough questions about IT because IT investment directly impacts the business’s surviving and thriving in the long run: Because IT is an enabler of current and future capability for both the organization and its ecosystem (the market comprising competitors, suppliers and other agents, regulators and so on) much of the board conversation about IT should be framed in respect of the business activities and the ecosystem. BoDs should ask tough questions about IT investment and performance: How does IT enable business capability development? What developments in the capability and use of information technology are critical to the strategic future, and how to responding to them? What limitations are imposed on strategy by the constraints of the information technology currently used by the organization and in the digital ecosystem? Making inquiries about IT can clarify the business's strategy management capabilities and deepen the understanding of how to maximize the business potential for the long-term perspective.

The further-looking board should participate, or even lead in the area of innovation from an outlier’s viewpoint: No longer are boards sitting in a room and just voting on various policies for business compliance. Digital is the age of innovation, it is one of the requirements of the Board members to participate, or even lead, in constantly suggesting areas of innovation. The further-looking board should participate in both innovation management and management innovation. Innovation is too important to leave solely in the hands of the management team without any oversight or guidance. The effective board brings together such a tremendous set of skills and experience mix that there are bound to be board members whose ideas could feed into new value creation. Imagine how the companies could change if each Board Director felt his/her mission is to expand the value to the existing or new customers, with new ideas, new products/services; or the new structures. The board should ask how the enterprise measures innovations and how it compares to Best in Class performance and be sure the measurements are accurate from the eyes of the customers and their constituencies.

BoDs as top leadership roles need to envision and lead the organization towards its future. The digital BoD leadership needs to be future-oriented and further looking, with the clear business vision and the collective and broad range of business perspectives, they can explore the vision and fresh ideas in a spirit of open-mindedness, learning, and experimenting.


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