Boards are creating significant roadblocks in digitization strategy


In the 4th edition of ‘Digitization on Boards’, a study by global executive search and leadership consultancy Amrop looked into the keys to high performance amongst digital leaders and their organizations.

The highly targeted research was conducted in late 2020. It compares the perspectives of 58 C-suite or Board-level digital leaders from fast-growth organizations* with low-performing equivalents. Both groups represented multiple sectors; approximately 40% with over 5000 employees. The fast-growing group posted minimum €50m revenue. The senior digital executives of mainly European organizations were asked to rate two major dimensions: their own competencies, and their organizational context.

Amrop dedicated the research to seeing digitization through the eyes of digital leaders.

It sought to answer the question: What are successful digital executives (and their High Performing Organizations) doing better and differently in the digital arena? In this complex environment, where can digital executives and non-executive boards focus — and win?

The survey surfaces a clear message: the digital leaders of the High Performing firms post significantly higher scores on their own competences. However, strong growth and the impressive performance of digital leaders are arising in spite of a number of roadblocks presented by boards and the wider organization. In fact, a whole host of hindrances was identified, which the study named the ‘Pyramid of Digital Frustrations’.

‘Pyramid of digital frustrations’

The most striking finding was that only 30% of respondents agreed that their Board understood the challenges of their role or supported them in carrying it out. Board understanding of the technicalities of the digital role would not necessarily be expected, however the fact that even in High Performing Organizations, CIOs do not feel supported or digital strategy recognised for its value, was remarkable. For 70% of respondents it was clear that boards are only paying lip service to digital strategy, and often missing the step from vision to action. Regarding the hard questions surrounding process and resources, there is a clear sense that board support fades.

Correspondingly, 60% of digital executives reported ‘digital impatience’ and a lack of realism when it comes to digital initiatives. Similar numbers are blocked by board short-sightedness, with insufficient thought given to the transformation of business models via digitization. Furthermore, as many as 50% of digital leaders felt that the focus is on current revenues, with attention rarely paid to any future benefits of digital investment. Similarly, insufficient dynamism or decision-making speed were cited as reasons for low digital momentum and the inability of companies to deliver on digital opportunity.

Pertinence of timing

The timing of the study is significant as it took place during the global pandemic, where digital competency has been brought to the forefront and widely understood to be critical to short- and long-term business growth.

Improving digital literacy to unleash growth

The report goes on to make recommendations to boards, executive teams and digital leaders themselves on how to turn the status quo around. Taking a hard look at organizational architectures, improving digital literacy through board education and re-designing board structures are all outlined as steps to unleash growth via digitization.

“Whilst digitization is named as a priority for boards in the organizations we surveyed, board literacy and understanding are only on the starting blocks. Board members must be willing and able to transform the business model, focus on the innovation that drives customer value and understand the global impact of digitization. If this understanding is absent in a board, it must be installed as a priority, even if that means taking some painful decisions,” commented Job Voorhoeve, Leader of Amrop’s global Digital Practice.

He continues, “In this complex environment, our research maps clear avenues for improvement to boost business performance through digitization. We argue that digital executives are jointly responsible for transformation, so they need to be fully up to speed on their own competencies. The research provides a dashboard that captures the main dimensions and skills CIOs and their equivalents need to master. These skills need to be hired, coached and mentored; they can no longer be left to chance. Digital executives deserve support in making the business case to boards in a clear and compelling way. In turn, boards should be in no doubt of their role in igniting an organization’s ability to harness the power of digital for transformation and growth.”

*Companies cited as ‘fast growing’ by reputable independent sources (e.g. FT 100 listings) and market data. 79% of respondents confirmed their company had posted 3-year growth. Of these, 82% cited a growth rate of 5%+ with 65% citing a growth rate of 10%+.


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