How boards can lead digital transformation efforts


Authored by RSM US LLP

Digital transformation is a topic that has been on the collective minds of most boards in recent years, but the COVID-19 pandemic has accelerated the pace of change necessary to stay competitive due to evolving customer and employee demands. With the importance of innovation moving even further to the forefront, boards may need to take another look at how digital transformation is prioritized and managed within the organization.

The digital transformation playbook is changing for organizations of all sizes. Companies are moving from digitizing—focusing on operations and efficiency—to a more digital mindset, which means disrupting the model within the industry and doing things differently. And contrary to popular belief, digital transformation is not just about technology; instead, it encompasses people, process and technology.

RSM recently conducted a survey in conjunction with Corporate Board Member that highlighted how boards are adapting to a new digital environment. Among the highlights:

  • Seven out of 10 directors believe digital transformation is critical to their company’s success, with nearly half rating it a 10 on a 10-point scale.
  • Forty-eight percent of respondents say that COVID-19 has changed their business model significantly, shifting the focus toward modernizing the brand with new capabilities and redefining the company.
  • Talent is the biggest barrier to digital transformation, cited by 57% of the directors in the study.
  • Three of five respondents feel their company is either very behind or somewhat behind competitors from a digital perspective.

Technology evolves very quickly, and when people see what is now possible and how rapidly consumer and employee demands are changing, it’s natural to feel somewhat behind. However, it’s one thing to be behind, but it’s another to be late to the game. While some organizations are certainly risk-takers and digital leaders, boards can take steps to make up digital ground and leverage innovation to gain an edge on competition.

Surround yourself with the best experts

If you only get technical information from the CTO or CIO about digital transformation, you will likely miss out on the majority of transformational opportunities available. While their insights are certainly important, consulting a broader range of leaders can help you learn how digital transformation can help solve a host of business problems.

For example, you may also think about bringing HR leaders in to understand changes in recruiting or people development. Marketing leadership may also provide insight into how new technology or strategies can enable the company to market differently or create new channels to bring in new customers.

Educate yourself

Digital transformation will continue to be a top initiative for years to come, and if you are expected to continually remind management about its importance, you should also understand what options are available and what they could mean to the company.

One route that some board members are taking is to enter a reverse mentor relationship with a potentially younger, more digitally proficient coworker. In that relationship, you can learn about and experience digital technologies that you may not have exposure to otherwise. In addition, a host of learning opportunities about innovation and digital strategies are available through online services such as YouTube and LinkedIn.

Onboard directors with the right skill sets

Imagining a scenario where your board has members with knowledge of each emerging digital strategy and technology option available is nice, but it’s simply not possible with limited space. However, when considering candidates to add to the board, exposure to past digital transformation solutions and current strategies should be a consideration.

Form a tech committee

Initially, boards can have difficulty determining where digital transformation fits within a committee structure. When something is new, it is often added to the audit committee; but is that really where this belongs? While digital transformation has elements that may work in the audit committee, it also has areas that may best belong in the governance committee.

From a board perspective, you need to think about the different structures and how you will manage your transformation long term. With the unique nature and importance that digital transformation will have to the future of the organization, forming a separate technology committee may be the best move.

Ask the right questions

When it comes to technology or transformation initiatives, boards are typically used to monitoring projects that might take years to implement and see results. However, today’s digital transformation is different and more fast-paced, and it’s unlikely that will change any time soon. You now have to operate with a more agile business model, and that outlook should trickle down to the questions asked about digital projects.

For example, you might want to ask about how projects are focused on short-term goals compared to long-term goals, what executives are seeing in the outside world that may be applied internally, and how long new features and strategies will take to be introduced. The connections mentioned earlier with executives outside of IT can also lead to other questions that can uncover transformation opportunities throughout the organization.

Inspirational leadership

Being a champion of digital transformation is one of the key roles a board can play. The board is instrumental in instilling the mindset of change, but also raising the question of how it is prioritized and aligned with all of the other initiatives that you need to achieve. The board should be the constant voice reiterating the approach to and importance of digital projects. While you may not implement the strategies yourself, you can play an important role in making sure leadership keeps their mind on transformation.

In addition, inspiring innovation may require a culture shift. In order to generate new ideas, you need to make sure that the organization does not punish commercial failures. Instead, applaud small failures and encourage employees to take risks. Failing fast is an important part of an evolving business.

Ramp up your internal personnel

As mentioned in the survey, board members view the biggest barrier to digital transformation as talent. Therefore, when you are making transformation plans, you cannot forget about the people part of the equation.

For example, there’s no reason that individual development plans can’t be formulated for each of your critical employees. A variety of online courses and in-person learning can hone their skills, and your company should emphasize internal development because talent is so scarce. Often, organizations put training at the bottom of the list with most initiatives. However, it is one of the most important things you can do and can have a significant impact on your digital success.


Connecting with customers and employees is far more challenging in today’s world than it was pre-pandemic. This is why board members are more aggressively pursuing digital transformation. Organizations are now awakened to the need to be innovative—companies may have been around for generations, but since March 2020, many have realized “we just can’t keep doing what we’ve been doing.”

Digital transformation is both an art and a science. The science is the innovation, but the art is getting people excited and shifting the organizational mindset. With the right approach, the board can play a critical role in helping the company move forward with both of these endeavors.

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This article was written by RSM US LLP and originally appeared on 2021-06-28.
2021 RSM US LLP. All rights reserved.

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