How Boardrooms Can Build a Better Future With Board Intelligence

By Paroon Chadha, CEO at OnBoard

Paroon Chadha, CEO at OnBoard

The new year offers new opportunities for boards to build better processes that can help them become more effective in executing their missions and advancing the organisations they serve.

These changes will require boards to capitalise on new methods and technologies to streamline operations and better track and analyse overall board activities. The insights gained as a result will provide a foundation for continuous improvement, steering boards in the right direction and facilitating real-time corrections should they veer off course.

These changes will not be easy. They will require boards to be purposeful in reshaping standard operating procedures. The good news is that the past two years have shown that boards are capable of rapid transformation. It is one positive to come out of this challenging time.

How We Got Here

The advent of COVID-19 in early 2020 propelled boards and businesses worldwide into the digital age once and for all, as many organisations were forced to make an abrupt switch to digital formats and virtual meetings. The start of the pandemic was a sea-change moment. As the world moved to stem the virus’ spread through social distancing, boards shifted into full crisis management mode. Board administrators scrambled to learn how to securely distribute digital board materials and switch from in-person to virtual board and annual shareholder meetings.

For some boards, that meant cobbling together various technologies and platforms to create a facsimile of the boardroom experience, albeit more complex and with a steeper learning curve. For other boards, the shift was made easier through the use of purpose-built solutions, board portals, and other forms of board management software.

Now that these boards have experienced the benefits of using technology that simplifies and optimises board interactions, there is no going back. Analog boardrooms and tedious processes soon will be a thing of the past. Board leaders must resist the urge to fall back into pre-pandemic habits and embrace the benefits of digital transformation—both those that exist today and those that have yet to be realised.

Incremental Change

The pandemic accelerated the digital evolution of boards, and now is the time to keep the momentum going. It’s all about taking small steps.

Consider the compounding effects that insights can have over time. Fitbit and Apple Watch step trackers, for example, began with a simple promise: they would track your daily steps toward a goal and report your progress in real-time. Today, the step trackers and their simple use case have transformed into intelligent devices capable of providing insights into users’ behaviours and coaching them toward better health and wellness practices.

The same can hold true for board meetings and governance processes generally. Boards should start by thinking beyond virtual meetings—which many have already adapted to during the pandemic—to consider what other board interactions might benefit from digital transformation. Board management solutions offer the ability to convert a variety of other functions, such as voting, taking attendance and annotations, building agendas, conducting surveys, and defining roles and terms, from analogue to digital.

Converting from analogue to digital makes these processes more efficient, allowing board leaders and administrators greater time to focus on more meaningful priorities. It also provides an opportunity to collect data and develop baseline reports with real-time insights for more informed decision-making.

These insights could benefit boards at multiple levels. At the meeting level, for example, they could help boards evaluate questions such as: When before meetings do we publish our board information? How many pages is the board book? How many interactions and discussions are happening before the meeting? Do board members consider themselves adequately prepared for the meeting? Is there optimal time in the meeting to cover everything on the agenda?

All of these data points can be measured, analysed, and optimised for more effective meetings. Leaders can better identify and target inefficient and unnecessary processes, enabling them to spend their valuable meeting time together on the most vital matters.

Another level of intelligence could focus on data about the board itself. Boards can begin to address questions such as: Do we have the right people in the room? Do we have the right outside experts? What skills do our board members have? Do we need a new committee for environmental, social, and governance (ESG) issues? Are we providing board members the support they need for continuing education? Are we keeping an eye on term limits and proactively planning for the board’s future?

This data is more nuanced and complex, but it should be captured and analysed so that boards can evolve toward better versions of themselves for the organisations and communities they serve.

The Future of Board Intelligence

The next level of intelligence involves evaluating boards against external benchmarks from peer organisations. This could be done by comparing attributes such as size, geography, or stage of business development. For example, the board of a fast-growing financial services firm could assess how its board activities and priorities compare to similar firms locally, nationally, or even globally.

With this, boards could answer important questions such as: Are we making decisions quickly enough? Are we keeping pace with our peers on ESG issues? Are we evaluating cyber risk frequently enough? Where are we lagging on diversity and inclusion compared to other boards?

The ability to use real-time data and analytics to address these types of critical, future-focused questions represents an evolution to full digital transformation. This applies to every board across every sector. Moving past the challenges of 2020 and 2021, it is time for boards to take the reins, leave outdated and inefficient processes behind, and leverage board intelligence for a better future.

Significant change is never easy, especially when it comes to making the transition to digital operations. Below, we outline five action steps to help board leaders make the shift to a broader use of digital processes:

1.Build consensus. Ensuring appropriate communication throughout the process is critical to facilitating a smooth transition. Board leaders should work from the start to gather input and build buy-in organisation-wide so all stakeholders understand and support the need for a board management solution.

2.Evaluate current processes. Boards must understand where they are before they can determine where they need to go. This requires analysing how the board operates today, including who is involved in each procedure, director and administrator responsibilities, the amount of time involved, and the tools, processes, and resources they use to complete specific tasks.

3.Define your needs. Based on a comprehensive analysis of current processes, board administrators can identify what works, what doesn’t, and any specific requirements their organisation has in looking for a board management solution.

4.Research your options. Administrators and board leaders should thoroughly explore the available digital tools, platforms, and applications to determine which one best suits their organisation’s needs. Important factors include cost-effectiveness, ease of use, security, adaptability, and training and support.

5.Execute a clear implementation plan. Once a digital solution is selected, board leaders should work in partnership with the solution provider to develop and execute an implementation plan that assures everyone receives the necessary training and support.

Some boards may think that adapting to virtual meetings qualifies as digital transformation. But to truly transform board processes and effectiveness—and thereby enable better oversight, support digital transformation of the company generally, and ultimately transform the way the business operates—boards must rethink governance processes and ask themselves if their analog solutions are aiding or inhibiting their important work.