It Pays to Have a Digitally Savvy Board

As companies seek to improve their business models, customer experience, operational efficiency, and more through new technologies, their boards must help them move forward at a sufficient pace. Those that do are likely to see better financial results than those that don't, according to a machine learning analysis of the digital know-how of all the boards of U.S.-listed businesses. After examining data from surveys, interviews, company communications, and the bios of 40,000 directors, the authors of this article found that companies with digitally savvy boards significantly outperformed others on key metrics such as revenue growth, return on assets, and market cap growth. When boards lack digital savvy, they can't play their critical guiding role. But companies can fix that by understanding what kinds of characteristics to look for in existing and new board members, managing board agendas differently, and cultivating new learning opportunities.