Although 85 percent. of CEOs believe their companies have accelerated digitalization during the pandemic, a survey of board representatives and business leaders reveals underinvestment in technology and gaps in their engagement with digital transformation. According to the report Digital Frontier: A Technology Deficit in the Boardroom, prepared by consulting firm Deloitte, only 45%. board members and 41 percent. of administrators believe that management is sufficiently involved in technology.

In early 2022, as part of the Deloitte Global Boardroom Program, a survey was conducted among 551 representatives of boards of directors and directors (CxO) of companies from 55 countries. Its objective was to understand the level of management involvement in activities related to the use of new technologies. He also had to check what they were doing to make sure their technology investments were tied to their organization’s strategic goals.

According to a Deloitte study, more than 80%. of respondents were at least somewhat confident in their ability to understand, verify and discuss their organization’s technology strategy and agenda. At the same time, less than half of directors (45%) and administrators (41%) believe that boards provide sufficient oversight of technology issues. The opposite opinion is shared by no less than 41 percent. and 27 percent subjects.

Respondents are engaging with technology to a similar extent as seen in previous years, and many board members lack the knowledge to ask informed questions and ensure technology is properly aligned on the business strategy of the company. It must take advantage of the opportunities offered by the latest technologies, and innovation must guide the lines of development. Overall, the study revealed a gap between the growing demand for a better understanding and commitment to technology and current boardroom activity in this area. – says Daniel Martyniuk, partner, leading technology consultancy Deloitte.

The participants in the study identified the main issues influencing the effective management of technological issues. Nearly half say that in this area they rely too much on the IT leadership team or an internal or external consultant to make decisions – this is what 40% of them think. board members and 42 percent. directors. The lack of technological mastery of boards of directors is cited by 38 and 42% respectively. asked. A third (36% and 33%) indicate an unclear management structure for technology issues. Challenges also included poorly defined management information in this area (34% and 42%) and unclear links between technology and strategy (30% and 33%).

Top management overestimate their technology skills

Asked about their companies’ progress in using technology to gain competitive advantage, respondents to the Deloitte survey were overwhelmingly optimistic – 66% responded. board representatives and 69 percent. directors.

It seems that an overly optimistic approach may be the result of a cognitive bias, where the lack of in-depth knowledge on a specific subject results in a belief that there are no threats and an overestimation of one’s own abilities. in this regard. In a field as dynamic as technology, however, corporate boards should be more vigilant – especially as the study clearly shows underinvestment in corporate technology. This is indicated by 47 percent. of board representatives surveyed and 54 percent. directors – said Anna Wiącek-Kocot, Partner in the IT Strategy and Transformation Team, Deloitte.

Among the areas in which their organizations plan to invest in the next three years, board members and trustees primarily cite data analytics, improving efficiency, and improving decision-making ( 73 and 81%, respectively), improving the customer experience (71 and 73%) and streamlining in the area of ​​cybersecurity (58% and 65%). Other positions include: expanding employees’ technology skills (49 and 61%) and developing artificial intelligence and robotics to increase productivity (47 and 56%), as well as using solutions to optimize supply chains (43 and 46%). percent) and to accelerate green transformation (34% and 33%).

Effective corporate data protection is a challenge for the near future
The Deloitte survey also showed the lack of confidence of board members and administrators in the processes related to the protection of data assets existing in their organizations. Only half of respondents say they are well-secured. Others are not sure if this is the case (about a third) or feel they need to do more in this regard (15%). This varied somewhat from region to region. In Europe, the Middle East and Africa (EMEA), more respondents consider the data collected to be more secure than in other regions, and respondents in the Asia-Pacific region are the most skeptical about their ability to protect them.

Most respondents believe they understand the cyber threats facing their organizations and their potential impact on running a business. However, they cannot identify the three most serious threats in this area or determine how the company could minimize them. Given the ever-changing methods and increasing technical advancements of cybercriminals, board representatives and business leaders should pay more attention to this area. – says Michał Sosinka, Director of Cybersecurity Team, Deloitte.

Respondents to the Deloitte survey also indicated actions they can take to improve technology engagement and management in their organizations – 66%. board members and 61 percent. Leaders above all mentioned the need to make managers aware of the latest technological trends. Slightly fewer (60% and 61% respectively) say a more holistic technology plan is needed and how it links to the management strategy. Another assumption – making technology a standing agenda item in meetings and greater cooperation with CTOs (CIO, CTO, CISO) – was much more prevalent among CxO respondents (54%) than among the representatives of the board of directors (45%). An even greater disproportion in the answers obtained concerns the proposal to involve a person with in-depth technical knowledge in the board of directors, which is recommended by half of the directors and only 34%. representatives of the board of directors.

These activities can be linked to another extremely important question raised by the study – the relationship between the organization’s strategy and the technology agenda. Up to 40 percent board members and 38 percent. the directors do not believe or are not convinced that these elements are sufficiently integrated.

The importance of technology continues to grow, often directly determining the competitive position and financial results of the organization. Therefore, it is imperative that boards focus on the nexus between business and technology strategy – this should not be left to the sole discretion of CIOs. The board doesn’t know whether the development of technology in the organization supports strategic goals – and according to the study, up to 13% responded. board members and 7 percent. administrators – should no longer be the case, regardless of the sector – says Anna Wiącek-Kocot.

You can download the full report here.