How well do people over 50 really understand social media? That’s been the subject of plenty of summer comedies that feature aging, out-of-work characters that apply for summer internships at social media companies. Or more recently, John Favreua’s “Chef,” in which the titular character loses his job when he fails to understand that responding to a poor restaurant review on Twitter is not a personal conversation. These quandaries are the stuff that movies are made of, but they are also major issues for the business world and boards of directors as well.
I have been involved in a number of discussions with corporate boards regarding how to ensure that board members understand the significance of “new technology.” With the average age of directors in Fortune 500 companies hovering in the mid- to late-60s, the issue is not inconsequential. New technologies may not be familiar to many corporate directors, and having a director with a particular expertise in new technology is becoming an essential part of board talent discussions.
Consider the fact that in today’s world, boards face a variety of new technology issues, from understanding new marketing and communication paradigms in the form of social media, to delivering products in such new environments, to considerations of how to protect personal and confidential customer information in such an environment, to safeguarding and ensuring information security and preventing cybersecurity attacks. Indeed, recent challenges retailers have experienced with protecting customer information through their payment device systems shows how pervasive technology issues are, how they impact business decisions and how they are landing on board agendas.
As board-nominating committees review the collective talent represented by their directors and consider those talents they want in new directors, new technology expertise becomes a priority. No longer is it enough to contact a board search firm to say, “We need a technology candidate,” because the questions that follow will point out the difficulties in filling that general request.
The board needs to discuss with management the most important areas of new technology for the company and what type of business or other experience best represents that area of new technology. The board should ask itself a number of questions: Do we want a director who is an expert in an online, Web-based distribution experience? Do we want someone who is entrepreneurial and involved in the latest online application development? Do we need a director who is steeped in the experience of running a company’s technology systems to understand the fortress-like infrastructure that must be in place to protect the company’s systems? Do we want a director who can get the company’s products up front and visible in an online environment? Do we need a former law enforcement expert who can pinpoint the weaknesses in our systems?
By asking these questions in frank discussions with management, the board can establish priority candidates with priority technology experience. But the process should not end there. What I recommend to boards is a process to survey existing directors about their knowledge, experience and level of interest in all areas of technology and social media. The process then matches directors with the company’s priorities in areas of new technology. With the agreement of the directors, they spend time with management to learn what the company’s role is in that area of technology.
In essence, this process trains directors to be “lead directors” in those areas of new technology that they chose, and that are based on the key technology priority issues for the company. Facilitating director engagement of this sort has the added effect of enhancing board discussions and involvement in understanding key issues facing management.