How Digital Disruption is Challenging Board Rooms

Dottie Schindlinger

How Digital Disruption Is Challenging Board Rooms

This blog is based on Episode 3 The Corporate Director Podcast, where we interviewed John Hinshaw, a technology executive who has served in senior positions with Hewlett-Packard, Boeing, and Verizon Wireless. He is currently on the boards of Sysco, BNY Mellon, DocuSign, and Illumio.

>> Listen to Episode 3 on Apple Podcasts.

Digital disruption has impacted nearly every industry. Retail, transportation, and even healthcare have been upended, as market disruptors have begun to supplant long-standing companies. Innosight reports that half of the S&P 500 companies will be replaced over the next 10 years. The forecast is pretty clear: Disrupt, or be disrupted.

We sat down with John Hinshaw recently, who’s held senior positions and directorships at various companies (like Sysco, Hewlett-Packard, Verizon Wireless), to discuss how boards today are tackling technological unrest. Hinshaw’s combined experience as a technology executive and as a director gives him unique insight.

Every Board Should Be Talking About Disruption

Directors must ask: How can we disrupt ourselves, before someone else does?

— John Hinshaw, board member with Sysco, Bank of New York Mellon, DocuSign, and Illumio

Every board is discussing digital disruption. “It’s front and center everywhere,” said Hinshaw. Specifically, customer experience is the central topic: Companies are interacting with their customers in purely digital ways — whether it’s billing, ordering, customer service … every touchpoint must evolve to a tech-driven interaction, and discussions on how to integrate the technology have penetrated every board room.

5 Questions You Should Be Asking Your Management Team

Everyone is essentially carrying a powerful computer with them at all times now (smartphones), and in Hinshaw’s opinion, the discussion of customer interaction on mobile devices should be a primary discussion for every board, if it isn’t already.

From his experience in technology and on boards, Hinshaw identified five questions every director should be considering:

  1. How is the company connecting with their customers over mobile?
  2. How differentiated is that app and app experience from competitors?
  3. Is the tech team agile enough?
  4. Should we partnering with other companies to create better mobile experiences?
  5. Do we need new skills in house to create better mobile interactions?

How Tech Execs & the Board Should Work Together

Don’t let the only discussion be in the boardroom; this goes for both management and directors. There must be frequent dialogue between the board to management. Technology changes too quickly to allow communications to stagnate.

For management: If necessary, find a way to educate the board. Don’t just use decks, but use demos, explaining how things used to be done and how they’re done now. Point to metrics and results—improvement of customer satisfaction, higher sales, etc.—to show the power of digital.

For directors: If management isn’t delivering the before-and-after picture of digital for your company, ask for the results, the metrics, the data. You should be able to see how digital is changing the industry and the company.


>> Listen to Episode 3 on Apple Podcasts.


How Technology Will Change Boards Within the Next 10 Years

Given Hinshaw’s background with experience as both atech executive and director, we asked him how he believes boards and board meetings will be impacted by technology over the next 10 years.

Hinshaw said he is looking forward to the real-time information that he knows will soon be available. Instead of looking at last quarter’s numbers that came in three weeks ago, John says he’ll be reviewing sales numbers from five minutes ago.

The Best Thing He’s Read About Corporate Governance Recently:

Hinshaw suggested checking out PwC’s report on how younger directors (those under 50) are impacting board rooms across the world.

Stats Every Director Should Know

  • Half of S&P 500 companies will be replaced over the next ten years (source).
  • Average tenure of a company on the S&P was 33 years in 1964. In 2016, that went down to 24 years, and by 2027, the average tenure will be 12 years (source).
  • 52% of the companies in the Fortune 500 have either gone bankrupt, been acquired, or cease to exist as a result of digital disruption (source).

This post is based on Episode 3 of The Corporate Director Podcast hosted by Dottie Schindlinger and Meghan Day, with guest John Hinshaw. To hear this episode, and many more like it, you can subscribe to the podcast here: Apple Podcasts | Spotify | Stitcher | Google Play | SoundCloud.