Educate the Board!
By Samuel Greengard
These days, CIOs are hard pressed to keep up with the rapid pace of change. Others, such as corporate boards, often end up choking on the digital fumes. The final result, not surprisingly, is less than optimal business decisions.
A recent survey conducted by PwC found that nearly one-third of corporate directors lack sufficient understanding of information technology. Remarkably, only 15 percent described IT as "critical" to their organization, though the figure rose from 13 percent in 2012. Nevertheless, one-third of boards are spending more time on IT, 61 percent want to spend even more time considering IT risks, and 55 percent take the same tact about IT strategy.
The reality is that a basic grasp of IT—and in many cases a strategic understanding—is now essential. Getting a board of directors up to speed is paramount. But this means more than simply understanding what an IT system or initiative does or how there's a business tie-in. It involves a deeper appreciation for business opportunities and risks, as they pertain to IT.
According to PwC, 32 percent of directors say they do not have a sufficient understanding of IT to support the company's strategy and IT risk mitigation. Only 22 percent of directors say they "very much" agree that the company's approach provides them with adequate information for effective oversight.
For CIOs, this situation represents both a challenge and an opportunity. On one hand, directors are more eager than ever to learn about IT issues and incorporate them into their decision-making. On the other hand, many of them lack a full appreciation for IT and the nuances of tech. In addition, they don't know where to begin. As a result, CIOs should spearhead the effort to educate boards. This can include briefings, regular updates about IT initiatives, and the use of social collaboration and other tools.
It's simple: a well-informed board equals a better-run company.