As a housing association board member and a technology advisor, I’m often surprised by how digitally unsavvy board members can be. I know some organisations are creating new technology forums, building the expertise of their board members, and strengthening IT governance – all with the aim of allowing boards to guide management by asking the right questions about the impact of technology.
Peter Lunio is a Non-Executive Director at EPIC Housing and a Business Partner at Insights with Purpose
8 March 2019
But what are the right questions to ask at a time when digital/analytical technologies are disrupting industries and mastering these technologies may be the key to the long-term survival and success of the sector?
The particulars of each association’s situation will, of course, determine the focus of your discussion and the detailed questions to ask. However, board members, whether you’re technology savvy or not, will benefit from reviewing the following questions as the basis of a conversation with your executive about how your association can deliver its digital dividend.
1. What will it take to exceed our customers’ expectations in a digital world?
Customers are being educated by e-commerce leaders like Amazon and Apple to expect an ultraconvenient experience, personalised in real time. Many organisations are now differentiating themselves from incumbents through convenience and service.
As a result, customer expectations are rising quickly. Simply meeting these expectations can be a major effort for associations that were not born digital. The bar is high for delighting customers in a digital world.
2. Do our business plans reflect the full potential of technology to improve our performance?
Technology expenses can be high, but they are relatively small compared with the potential to boost your association’s operating performance. Technology can improve business performance by reducing overall costs – for instance, by automating end-to-end processes – and lowering risk costs.
By seizing the opportunities and mitigating the threats, associations can dramatically improve their performance. With the right agreement on the scale and scope of the opportunity and threat, the level of investment in IT becomes an outcome rather than a constraint or cost.
3. Is our portfolio of technology investments aligned with opportunities and threats?
Your portfolio should clearly reflect the business opportunities and threats at stake. It also needs to be dynamic – executives must avoid the temptation to reuse the allocations from the previous year’s budget without a close review.
Associations should balance short-term income and expenditure opportunities (for example, upgrading digital channels), medium-term platform investments (such as customer databases), and carefully chosen longer-term bets (for instance, piloting new, digitally/AI enabled business models – this is something I explore in another article on ‘the next generation operating model for the digital housing association’.
4. Do we have the capabilities required to deliver value from the technologies?
Technology alone delivers no value. It’s the combination of a clear strategy, the right technology, high-quality data, appropriate skills, and lean processes that add up to create value. Any weak link in this chain will lead to poor value delivery from IT.
In many sectors, a shortage of IT-literate talent in the business is creating a bottleneck. Contrary to popular belief, the majority of executives can, with the appropriate training, learn how to manage value from IT. But capacity building must start at the top.
5. Who is accountable for digital and how do we hold them to account?
In most organisations, accountability is clear for functions such as finance and human resources. But accountability for IT is not always so well-defined, and the IT function can’t be held solely accountable for delivering value from IT. Lower process costs, for example, benefit business units and functions other than IT.
The value of IT can also prove hard to measure. All too often, volumes of technical data are presented instead of a limited set of intuitive, business-relevant metrics. Measures of IT productivity or the bottom-line value delivered by IT are seldom available.
Whatever the model, IT leaders should be held accountable through scorecards that measure value delivered to the business in the form of efficiency, agility, and risk levels. Scorecards should be intuitive for even the least IT-savvy board member, and they should be aligned with executives’ incentives.
6. Are we comfortable with our level of digital risk?
Cybersecurity is a significant and growing IT issue and most executives have a poor understanding of the risks. But cyberattacks are just one category of IT risk. Digital-only tenant channels can also cause business-conduct risk – for instance, if automated recommendations conflict with regulatory requirements.
To read more insights into digital/analytics/AI, then please take a look at the Insights with Purpose blog.
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