borispain69 - stock.adobe.com
Board-level executives are losing confidence in terms of the digital skills required to respond to market demands, according to a study by recruitment consultancy Harvey Nash.
The sixth edition of the International board research report, published by Harvey Nash in partnership with the London Business School’s Leadership Institute, says that despite digital innovation being one of the highest priorities for businesses, only 42% of UK boards feel they have the right skills to deal with the new imperatives.
Additionally, the study noted that digital is moving further up the list of priorities for the participants, of which almost a quarter (21%) are members of the boards of major PLCs.
UK boards are the most likely of the regions studied to be ramping up digital expertise in the boardroom, with more than half (52%) listing this as a top priority, against the global average of 46%.
“Digital innovation has propelled itself towards the top of the agenda for boards in 2019, as the continuing rise of digital giants like Google, Amazon, Apple and Alibaba is causing companies in every sector to worry they will go the way of Kodak or Blockbuster,” said professor and deputy dean at London Business School, Julian Birkinshaw.
“But it is important to remember that there are still plenty of sectors – like retail banking, accounting, food and drink, or chemicals – where the biggest companies today are the same as they were 30 years ago,” he added.
“As a board member, you need to simultaneously worry about the threat of digital disruption while also reminding yourself of the deep capabilities, strong customer relationships, and powerful brand that you can use to sustain your company through these difficult times.”
The situation regarding digital skills in the boardroom at a global level is not that different. According to the study, which polled 640 chairs and non-executives from across the globe, less than half (47%) feel they are digitally prepared. This compares to 58% in 2018.
While boards feel they are lagging behind in terms of skills to navigate in the digital economy, participants also estimate technologies such as artificial intelligence (AI) will continue to replace jobs, with 16% of the executives polled predicting that 16% of the workforce will be replaced by AI in the next five years. Boards in the Asia Pacific region expect 1 in 5 jobs (20%) will vanish with the advancement of AI.
“The future under AI will be more complex and nuanced than simply replacing humans with machines. We believe that roles will be reskilled and redeployed as organisations recognise the importance of retaining talent,” said chief executive at Harvey Nash, Albert Ellis.
Out of the sectors covered in the survey, the technology and telecommunications sector are the best prepared, while areas such as healthcare are less confident, with only 40% of C-level executives polled saying they have the right digital skills.