More CIOs are being appointed to the board or are tasked to present regularly to this group as a member of the technology committee. Gartner executives Denildo Albuquerque and David Spaziani -- both former CIOs -- share pointers for stepping up to this role.
Gartner Executive Partner Denildo Albuquerque does not sugarcoat what it is like to be working with the board. "The boardroom is a scary place...even when it is empty," he says.
He reveals his first interaction with the board was "so bad, when I think about it, I still want to cry".
His first interaction with a company board was to explain a serious IT error which caused major repercussion for senior executives and a severe reputation damage to the IT department. "This is the sort of board interaction you do not want to have...and you will never forget it!"
Albuquerque has since moved on to other CIOs roles which required him to present regularly to boards, "fortunately a lot more positive experience than my first one".
The upside of these interactions is that, "You can improve with experience and practice."
Albuquerque and fellow Gartner Executive Partner David Spaziani shared their experiences on CIO and board interactions at the recent CIO100 events in Auckland and Wellington.
The two point out there is no prescribed formula on how best CIOs deal with and influence company boards. Board composition varies across industries and organisation size which also translate to different business technology challenges, they state.
But both agree the CIO should start honing their skills for these interactions as these will increasingly be part of their remit.
Research bears this out. Albuquerque cites a 2013 survey by the MIT Centre for Information Systems Research which found that (only) nearly a quarter (22 per cent) of CIOs attend every board meeting, and nearly half (48 per cent) meet with the board more than once a year. Nearly a fifth (18 per cent) meet with the board once a year, and 12 per cent, never.
The good news is that the frequency of interactions is growing year-on-year, he states.
His own experience proves this. In the 12 months leading to November last year when he joined Gartner, he has had more interactions with the board than in his whole 12 years as senior IT leader. This was largely due a transformation project the organisation was implementing.
Albuquerque also shares some sobering statistics from Gartner on why CIOs need to focus more on working with the board and the executive team.
Gartner surveyed CEOs and senior business executives across the globe on where they get their digital and IT-related business ideas. Fifty-four per cent of respondents mentioned publications, newspapers and reports. Less than half, 47 per cent, said they get it from personal or professional networks, and from that only 10 per cent ("a very low number", says Albuquerque) said they get this information from the CIO. Around 31 per cent of respondents said they get the information online, and 19 per cent get it from market or industry sources including Gartner.
The key is to discuss the tactical and strategic topics the board is interested in, says Albuquerque. These include capability, accountability, risk, agility, customer expectation in a digital world, business performance and investment alignment.
Spaziani, on the other hand, notes that when talking about IT-related investments, CIOs need to analyse these against three valuable criteria: topline growth, bottom-line savings, and risk management.
"Talk less about technology and more about the business," notes Albuquerque, "and what you can do to influence bottom line results."
A topic that is of growing interest to organisation boards is digital, he states, and these are around "what the competitors are doing, how digital is going to contribute to exceeding customer expectations, how it will enable competitive advantage... and very importantly what is the risk of doing nothing".
Albuquerque says most of his interactions with organisation boards were focused on risk and compliance, security, and management of large contracts.
It is important to get to know the board members, he says. The company secretary can help provide insights on their role in the board and other boards, career background and influencers.
But while building one's credibility is important, nothing will matter if CIOs and their teams do not do two things right, says Spaziani.
The CIOs and their teams must be able to provide stable and resilient systems and infrastructures, and understand the organisation's security strategy and architecture in terms of protecting the company from cyberattacks. The latter can severely cripple the organisation's reputation and cause financial loss, which is a primary concern for the boards.
Guidelines for board interactions
Spaziani says when interacting with the board, CIOs need to be:
Most board interactions last no more than 15 minutes. Know your time schedule and be attentive to time cues from the chair and the rest of the directors.
Transparency is a key objective for most boards. Focus on sharing good and bad news openly and appropriately.
When you don't know something, say so and then go find out. Always check your data before using any with a director. Spaziani notes it is the accuracy of the CIO presentation that the board will remember. "The board has a very short period of time to judge you. They are looking for body language, a sense of purpose, confidence and for someone who realises, 'I don't know' is a great answer. At times, it is hard to say, but it is best to just admit that you are not sure, but you know where you can find the answer and get back to them."
Keep in mind what directors want and need to know rather than what you feel they should know or become educated about.
Board interactions are not about being right or owning the floor. Your success hinges on being tactful and sensitive to what is happening around you and skilfully responding to it.
Albuquerque notes the rise of technologists (ex-CIOs and other senior IT leaders) joining company boards as members which is no doubt a positive impact in assisting boards to come up to speed with technology trends that will impact the industry and within competitors. There is also a growing trend of Board Technology Sub-Committees being created which are responsible for directing and advising on technology matters similarly to other sub-committees which are responsible in dealing with specific key functions like risk and compliance and remuneration.
In some organisations, in the absence of a board "Technology Sub-Committee", the CIO alone has the responsibility to advise and influence the board on IT matters.
Depending on the CIO's style, this can be a very challenging position. If you are not a good influencer, says Albuquerque, you can use someone to assist with this briefing. It could be a technology evangelist or an analyst presenting to the board or advising/preparing the CIO for key board interactions.
"The CIO interactions with the board are often brief so in order to achieve the best outcome, presentations have to be short, sharp and well delivered," he stresses.
Albuquerque and Spaziani note that timing is important when presenting issues or technology investments to the board.
As the global economy has slowed down in the past 24 months, they note boards have become reluctant to approve investments which deliver ROI only after a year, or which require multiple years to complete.
CIOs, they say, must sense and understand the investment mood of the board at each moment, and time initiatives appropriately.
There is no such thing as a "good surprise" when it comes to execution of major projects, says Spaziani.
They point out the quote from the chairman of the board of a retail company who said: "Our CIOs have been reluctant to tell us that they will be late to implement -- until it is too late."
"To succeed in their board interactions, CIOs must build board-level acumen, prepare extensively for each board interaction, excel in each board meeting and continue their influence into the future."