The level of digital upheaval is growing around the world with a big increase in the number of board members who believe their organisations are being disrupted. 41 per cent of directors, up from 31 per cent last year, acknowledged the impact in the Harvey Nash/Alumni board report, released in London overnight.
And in the APAC region, digital expertise is now the most sought-after board skill.
“Digital is still shaking up boards with its all-pervasive creep into the way business is conducted,” the authors said. That means digital is now “business as usual” for boards.
Bridget Gray, Harvey Nash managing director, APAC, told Which-50 the increase is due to a growing awareness of disruption at the board level, which in turn stems from the pace of change.
“Board member awareness has been elevated as a result of high profile disruption and in some cases extinction events. Directors now see it as their responsibility to proactively future-proof the organisations they represent,” Gray said.
The report, Old Game, New Rules: How boards of today are preparing for tomorrow, was developed in partnership with London Business School’s Leadership Institute and found that despite the increased recognition many organisations still aren’t prepared to tackle digital transformation.
“Just over half (58 per cent) of our respondents feel that they have the correct skills in place to drive digital transformation,” the authors said.
Many boards are looking within for a solution. The most popular approach to bridging the “digital divide” is an internal appointment, the authors said. 15 per cent of respondents have taken the step of appointing a chief digital officer and 14 per cent have appointed a “non-executive digital expert.”
Despite the defined roles, digital literacy is “no longer a specialist topic” and all board members need to understand how digital affects their organisation, according to the researchers.
“It is for everyone now. Gone are the days when digital was a nice addition to the business; for most organisations, it is their business,” the researchers say in the report. It’s also a constant for boards, according to the report, with several now regarding it as a permanent part of the board’s agenda.
Digital is dominating the agenda of APAC boards too. According to the report, cyber security (71 per cent) is top of APAC board agendas followed by digital innovation (69 per cent). Digital expertise is also the most sought after skill (56 per cent) for APAC boards looking to increase their effectiveness.
According to Harvey Nash’s Bridget Gray, “Often board members come from more of a commercial background and therefore need to learn more about the disruptive capabilities of digital in their organisations and industry verticals.”
“On the flip side of this, with a growing requirement for more technically oriented board members, they are working hard to ensure they up skill on the commercial side,” she said.
One third of APAC boards are experiencing digital disruption, according to the report. However, APAC boards are the most confident of all geographies in their ability to manage technology transformations and only one in five feel they lack the digital skills their plans require.