The importance of culture and technology to business success

20/5/2017

"In our world now, the primary mover for reproductive success—and thus evolutionary change—is culture, and its weaponised cousin, technology."

The words in this quotation, originally published in National Geographic (*), stood out when I first read them recently. They seemed to lift themselves off the page, as if to highlight their significance. The penny dropped when I realised the quotation is applicable well beyond the [biological] world from whence it emerged.

Take boards of directors for example. The quotation suggests that board effectiveness (and, by implication, company performance) is more likely to be influenced by board culture and appropriate technology than any static attribute such as a particular board structure, composition or governance code. This intuitively attractive proposition enjoys widespread support in the academic literature, and case studies of actual board experiences have been reported.

Yet board and company failures abound, which begs an awkward question. Why do some boards continue to prioritise structure and compliance (with statutes and codes of practice) over culture and technology, especially when a stronger focus on the latter is more likely to lead to increased board effectiveness and, importantly, better company performance?

(*) D.T. Max (2017). Beyond Human, National Geographic, April 2017, p.49.

Michael Sampson link

20/5/2017 17:09:11

How do you see this as playing out - in the best case? How would boards embrace a culture and technology focus to drive success? I've been interested in the latter half for two decades, albeit not at the board level.

Peter Crow link

21/5/2017 15:11:29

Great question Michael!

Culture is about "the way we do things around here". Though critical to team effectiveness and business performance, culture is rarely discussed by boards, except when things go wrong and by then it is too late. I encourage boards to allocate one session on their annual calendar (immediately following the formal annual board evaluation/governance review) to talk about culture, both from the perspective of acceptable behaviours and interactions within the board room and, crucially, the types of behaviours and interactions the board wants to see modelled within the company and beyond.

The technology opportunity is perhaps more difficult to define. Currently, most so-called board productivity systems are little more than portals—an electronic substitute for paper-based board papers, minutes and scheduling. Electronic documents (sharing, annotating and reading) can be a God-send, especially for directors who travel and if the board packs are extensive. Some boards have taken the next step and are experimenting with collaboration tools to facilitate effective interactions. The challenge of course is that board meetings are the place where decisions get made. If all of the directors are in attendance as they should be, the value and relevance of collaboration tools is relatively low. While these two examples (board portals and collaboration tools) provide a modicum of value, they fall far short of being any form of game changes. Directors need help to do their core role (make decisions) more effectively. As I see it, the untapped opportunity is to introduce cognitive software to the boardroom, to analyse 'written' material and spoken interactions on the fly; to assist boards make better decisions. Another other use of cognitive tools that I have heard discussed is in the areas of board evaluations. I'm involved in a couple of projects in this area and will soon be looking for boards to explore what might be workable in the boardroom.

22/5/2017 17:08:38

Thanks for your answer Peter.

Fully agree that boards should be paying more attention to within-board and organisational culture, especially if - as some claim - culture eats strategy for lunch. I question whether once a year is enough, however. Does that give it the visibility and importance that it holds within the life and success/failure of an organisation?

On the technology front, if all boards are doing is replacing paper-based briefing papers with e-delivered ones, then they have only changed "work practice" - for example, see Slide 23 in https://michaelsampson.net/keynotes/keynote-dwcnz2016/. There is no attempt being made to change across the deeper and more important dimensions that are indirect results of embracing new digital tools. In terms of collaboration tools (and deeper change), I'd want to see more than collaboration tools as a repository for digital documents, and not positioned as an extra to the board meetings themselves. The right collaboration tools can enable between-meeting engagement, discussion, and even decision making - or decision signalling through voting. This requires, of course, board members who are willing to "re-imagine" their value as a board member away from specific meetings - and that's quite a change.

A couple of other thoughts. First, if briefing documents are the core mechanism for explaining a point of view, have you seen any comparative work being done on how those documents are structured? To use a wild generalisation, a poorly written / poorly structured document would hinder the board's ability to make an effective decision, versus one that had a better structure. Clearly getting to the better end of the scale requires clarity of thought, analysis, and expression - which I fear is becoming a rare commodity in our 140-character biased world. Secondly, Paul Culmsee has for many years championed the use of dialogue mapping as a way of structuring conversation, although this requires a well-trained human facilitator in the room to perform the visual mapping. I could imagine that this would help greatly with decision processes, and a whole lot earlier than waiting for cognitive solutions to help. Third, ThinkTank (previously GroupSystems) offers decision support technology for meetings and other events. https://thinktank.net/product/product-technology/. This technology was studied in the IT academic literature, and there is also the academic discipline of "computer-supported cooperative work (CSCW), which is where I started doing my PhD studies (not completed) a decade ago. From what I recall, I think there could be some good opportunities for your work with this toolset.

All the best for your explorations ...

Peter Crow

22/5/2017 17:33:00

Thanks Michael, especially for the weblinks and references to Culmsee's work. The difficulty of course, is that the board is a collective of directors who are duty-bound to make decisions together. The references you have mentioned provide for the possibility of boards engaging much more strongly between meetings, something that I have long advocated because directors need to understand the business of the business if the board is to make high quality decisions. I'll spend some time looking into these matters over the next week or two and, if you are willing, visit you to discuss further.

On the culture point, I'm sorry to have implied that boards only discuss culture once per yea. You are quite correct that culture needs to an on-going discussion. My reference was to an annual check-up, akin to the board evaluation, financial audit and related validations.

Thanks again –prc.

22/5/2017 17:38:35

"Duty-bound to make decisions together." "Together" is currently enacted through in-person meetings, but it doesn't have to be. "Together" can be re-conceptualised as common materials, common processes, and joint input and evaluation.

I look forward to catching up with you, but we'll probably have to miss our usual London location this time.

Re culture - thanks for the clarification. I would expect that every board meeting has some sort of reporting / review of leading cultural indicators, and as you have written, complemented with an annual check-up / deep dive.

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The importance of culture and technology to business success

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