Information Technology and the Board of Directors: Is There an IT Attention Deficit?

Abstract

Given the ever-increasing importance of information technology (IT) to corporate success, board scrutiny of IT activities is a critical issue. This study conducted interviews with board chairs and board members of 17 medium to large corporations, most with global operations. Our question to them: How much attention does your board give to a range of IT-related issues, specifically, the CIO's IT vision for the company, the IT strategic plan, major IT application decisions, IT leadership, IT functional structure, IT function effectiveness, IT risk and exposure, and whether or not IT applications provide competitive advantage? We also interviewed the Chief Information Officers (CIOs) at these 17 firms about their view of what their boards ought to be considering.We found an IT attention deficit in these boards. The CIOs were nearly unanimous that boards should pay attention to: the IT vision, the IT strategic plan, IT competitive advantage, IT effectiveness, IT risk, and very large application development decisions and projects. All 17 boards were unanimous only on paying attention to IT risk. One-half the boards of the financial services firms had discussed the other topics. But none of the boards of the primary resource firms (energy, mining, forestry, agricultural products, and oil exploration and extraction) had discussed the other topics.After recounting the specifics of this research, we suggest six ways boards can reduce their IT attention deficit: (1) include IT on the board agenda, (2) invite the CIO to board meetings, (3) elicit brief CIO presentations, (4) recruit IT experience onto the board, (5) get the board talking about IT, and (6) realize that boards now operate in an IT era.

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