In ‘The Fourth Industrial Revolution’, Klause Schwab cautioned, “There has never been a time of greater promise or potential peril. Decision-makers are too caught up in traditional linear (and non-disruptive) thinking, or too absorbed by immediate concerns, to think strategically about the forces of Disruption and Innovation shaping out future”.
Typically, Disruption Discourse highlights the relentless emergence of innovative technology transforming products and services globally. Less is understood about the ‘cultural’ and human capacities needed to generate and manage those disruptive breakthroughs in light of Sonnenburg’s observation that, “what distinguishes exemplary boards is that they are robust, effective social systems.”
Working as a boardroom consultant across several jurisdictions, it can appear that populations are largely unprepared for the tsunami of change that technological disruption is unleashing. Many governments, boardrooms and organisations are also unprepared. Disruption maven, Peter Diamandis, suggests it’s because “humans still think locally and linearly, while technological change is occurring globally and exponentially.”
Boardroom people, culture, architecture and compliance must optimize on the challenges and opportunities of this revolution. Disruptive technology begins with disruptive thinking. Leadership guru, Robyn Sharma, observed, “All disruption starts with introspection. Self-disruption is akin to undergoing major surgery, but you are the one holding the scalpel.”
There’s a Darwinian imperative – you self-disrupt, or get disrupted! The Kodak board, with more digital patents than anyone, underestimated the coming digital revolution. Within twelve years, an iconic global company, with 140,000 employees, filed for bankruptcy and Instagram, with 13 employees, was purchased for one billion dollars. The popular idiom, ‘Kodak Moment’, suddenly had a whole new meaning. So how do directors ‘apply the scalpel’ to challenge each other and deconstruct group-think?
Sharma suggests elite boards convert challenges into opportunities and master disruption by generating creative applications that deliver stellar outcomes by ‘out-innovating, out-thinking and out-working everyone around you”. Today’s board must position itself as an incubator of disruptive thinking. Directors and management must ‘self-disrupt’ strategic thinking and practice, as well as processes, procedures, protocols and technology. How might disruption discourse be adapted and applied to boardroom psychology and sociology? Its not always a comfortable suit for many boards and jursidictions.
Optimism bias and anchoring bias are two of many cognitive biases that lead to strategic failures and operational mismanagement. Depending on the jurisdiction and the prevailing cultural biases around ‘dissent’, disruptive enquiry can upset collegiate alignment. Conflict avoidance, politeness, humility can be observed at one end of the behavioural continuum and confrontational, up-front engagement at the other. Across jurisdictions, the global board and the global consultant’s challenge is to negotiate those cultural stereotypes and functionally self-disrupt.
Christensen noted, “innovative thinkers connect fields, problems, or ideas that others find unrelated.” One effective competency to disrupt cognitive bias in individuals and groups and to join connective dots is converting curiosity into artful, incisive ‘questioning’. The quality of an individual’s life is determined by the quality of their questions. Socrates suggested, “The unexamined life is not worth living”. In the boardroom, the unexamined viewpoint is not worth retaining. Skillful, respectful questioning of self and others to gently move beyond ‘cognitive software failures’, (in the guise of conscious and unconscious bias), needs to be embedded in the board’s culture.
In the case of the cohort, the quality of a board’s performance is determined by the quality of its questioning and its ability to subject each strategy and operational determination to forensic risk analysis. It’s too easy for directors to default into group-think. All strategic decisions need to pass through a gauntlet of divergent ‘devil’s advocacy’ to avoid strategic error and operational failure.
However, directors are inevitably appointed for their hard skill sets and rarely is their competency to examine self and others considered in the selection process. There is now voluminous research on Cognitive Bias, Argumentative Theory, Developmental Theory, Boardroom Typologies, EQ and Boardroom Culture and Dynamics. Communication Literacy and Behavioural Ethics are emerging as indispensible director attributes. How might directors access and own that literacy?
Three initiatives will significantly up-skill directors in ‘questioning’, both effectively and collegiately. The first is an externally led review of directors and board. Ideally it’s a meaningful PD engagement that provokes and models reflective thinking, raises awareness, builds capacity and challenges individuals, much like a high performance sports coach. The Review serves as a disruptive engagement, in itself, that exposes conscious and unconscious cognitive bias around both dynamics and mechanics and thereby adds measurable value.
The second initiative, evolving from the Review, is targeted PD in soft skill areas. PD can optimise directors’ soft skill literacy to articulate and evaluate hard skill contributions and concerns, in a more collegiate manner, to the benefit of all stakeholders. It assists them to grow developmentally as people and practitioners.
Finally, every significant and successful disruptive innovation, strategy or initiative began with a question. Directors need to be masters of that capacity.
The third initiative is insightful, targeted Mentoring and/or Coaching that delivers both challenge and support. It can be a powerful, disruptive, self-reflective engagement. For the individual it may well begin with the most important self-reflective question – “Why am I sitting around this Boardroom table?” And for the cohort it begins with the most the most important group reflection –“Why are we sitting around this table?” When those two responses are aligned, in the interest of Profit, People and Planet, then Purpose informs Practice and stellar outcomes are possible.