Building Digital-Ready Boards

[00:00:00] Intro: Welcome to Minutes by boardcycle, where in each episode we pack the insights from one of Australia's boardroom leaders into just a few minutes.

[00:00:09] Today, join host Richard Conway as he interviews Hannah Browne, Managing Director of Midnyte City and Director of Greenpeace Australia Pacific, as they discuss the importance of technology skills in the boardroom.

[00:00:25] Richard: Welcome to Minutes by boardcycle. I'm your host, Richard Conway. And today on the podcast, I'm interviewing Hannah Browne. Hannah is a technology entrepreneur and non-executive director.

[00:00:36] Richard: She's the founder and managing director of Midnyte City, a technology consultancy, and is also a non-executive director at Greenpeace Australia Pacific. Hannah, welcome to the podcast.

[00:00:47] Hannah: Thanks for having me.

[00:00:48] Richard: So Hannah, given your technology background, I wanted to chat with you today about technology skills at a board level.

[00:00:55] Richard: It's fairly common nowadays to see boards identify [00:01:00] technology, digital, and innovation, or some variant of that in their board skills matrix as something that they need to have on their board.

[00:01:07] Richard: And so to start off with, I wanted to ask you, do you think that those kind of skills, technology and digital skills, should be a required skill for boards in a kind of similar way to the way that we think about financial management skills, and if so, why is that the case?

[00:01:24] Hannah: Richard, absolutely. I couldn't agree more with technology skills in boardrooms. And in fact, it's been one of my pet projects over the last four or five years actually is championing tech capability in boardrooms.

[00:01:38] Hannah: COVID showed us in no uncertain terms, what I've been talking to executive teams about for the last 15 years, which is that knowledge workers can work from anywhere. And actually how we measure and value their work, we can do a lot better than looking over their shoulders in an office and making, you know, in the cubicle farm, and making sure they're not on Facebook or, you know, insert social media platform here.

[00:01:58] Hannah: When that [00:02:00] occurred in COVID, and we were able to pivot from working in the cubicle farms to working remotely within about a week and not only see, not a loss of productivity, but an increase in productivity. All of a sudden, cohorts of managerial workers started to understand that actually, tech, it does underpin on our whole existence.

[00:02:19] Hannah: Like that circumstance really underscored in quite spectacular fashion, just how critically reliant we are on technology for all of our work and in so many facets of our existence. You know, technology drives our cars, now we all walk around with a phone in our hands most of the time, not even in our pockets, as an extension of ourselves. You know, we've got issues now that we could be contactable 24 hours a day where work-life balance is a challenge.

[00:02:47] Hannah: If you think that you can govern any organisation, I mean, particularly SaaS organizations and organisations that are tech at core. But I would argue there's not many organisations that are not [00:03:00] tech at core right now.

[00:03:01] Hannah: Even the coffee shop or the hairdresser is out of action if their point-of-sale system goes down. Not too many people have the old-fashioned cash registers. So if you look at how impactful and how deeply technology permeates every aspect of our organisations and our lives and our businesses now to think that you can govern an organisation without that capability in the boardroom is downright reckless in my opinion.

[00:03:26] Richard: Yep. And so to pick up on that, Hannah, you know, so critically important, I think another thing anecdotally we see is, outside of those businesses that are really tech businesses themselves, it's pretty rare to see people who are from kind of pure tech backgrounds, CTOs, CIOs, Developers, et cetera, moving up into the boardroom.

[00:03:51] Richard: So I guess the first question is, do you agree that's the case. And if so, why do you think that we're not seeing those people coming into the [00:04:00] boardroom as much as maybe is necessary?

[00:04:02] Hannah: I think to your earlier point, Richard, we're seeing more and more tech capability in the boardroom. And I think there's two main reasons that we don't have greater technical capability in the boardroom. I think the first reason and the major reason is, is a recalcitrance and a slow adaption to this new world in the boardroom.

[00:04:24] Hannah: I'm aware of a number of boards that don't even have a nominations committee or any kind of formal process around refreshing the board. It is very much a nepotistic “well do you know someone who's got the kinds of skills we might be looking” for way of operating, which is very backwards, very old school and might have been appropriate in a pre-internet world where globalisation wasn't necessarily the thing that it is now. But the way we are all connected now, there's just no excuse for not having a wide canvassing when you're refreshing your board or seeking skill and experience.

[00:05:00] Hannah: You know, we're not bound by geographies the way that we were, you know, 50 years ago or 100 years ago. So, I do think there is, due to the social demographic of the vast majority of, people in governance, I think there is a focus on the strategic and a less pressing sense of urgency around getting the right skills and experience in the room.

[00:05:24] Hannah: And, you know, I'm, I'm not much over 40, but I've certainly been on the receiving end of condescension in the boardroom. Where I was perceived to have not had value to offer because of my age, and maybe even because of my gender.

[00:05:38] Hannah: So I think, helping board directors understand just how critical technology is as a risk to our organisation, and that is certainly a conversation we can have readily at the moment with the cyber in governance is a very hot topic, and we should be leveraging that to maximum effect at this point to get technologists in the boardroom.

[00:05:59] Hannah: [00:06:00] My second point on that would be that the technology field probably hasn't done enough generally to be commercially savvy and skilled enough in the broader commercial landscape to have an offering in the boardroom. Certainly, some individuals are exceptions to the rule, of course.

[00:06:19] Hannah: My humble opinion on this is most business people will never understand tech beyond a reasonably superficial level, but most technical people are smart enough to understand the basic concepts of business and commercial ideas.

[00:06:34] Hannah: So building tech commercial capability into the Engineering or the Technical cohort is something I've been deeply invested in over the last five years. So, at my business, Midnyte City, we talk about building tech careers that build tech companies. We invest extremely heavily in developing, not only hiring for deep technical capability, but hiring for that strong EQ as well.

[00:06:59] Hannah: And then [00:07:00] building out communication, influencing, negotiation skills, persuasion skills. We particularly equip our team with the ability to think about strategy and risk and governance and leadership and culture and sales and marketing and finance and legal. Because having people with that really rounded commercial set of skills that come from a technical background and capability, I think presents a very compelling offering to the governance community.

[00:07:29] Hannah: You know, that's something that's on all of our organisations who play in the technical space to be skilling up, not just great technology leaders, but great organisational and business leaders for the future. But it requires a broader set of skills that, to be honest, not every engineer is interested in.

[00:07:44] Richard: Yeah, absolutely. I think that segues really well into a question I was going to ask you about, I guess, the fact that directors often are directors because they have a broad set of skills and if you look at some organizations board skills [00:08:00] matrix, when they talk about technology skills, they talk about technology awareness as opposed to technology skills.

[00:08:07] Richard: And so I wanted to ask you whether you think sort of, particularly picking up on your comment around someone who's not from a technology background, perhaps only ever being able to have a superficial understanding of technology, is that awareness enough in the boardroom, or do you really need someone who is a specialist or has really deep knowledge in technology?

[00:08:30] Hannah: Well, let me turn the question back around, Richard, would you hire for a finance role with just someone who was a generalist who say had run their own business for many years or been a salesperson who understands budgets, CapEx, OpEx, but you know, they had never done any study in finance, they'd never gained a chartered accountancy or let alone a CPA?

[00:08:52] Hannah: I think, to say that you can have a generalist cover off those things is naive in the extreme. We wouldn't hire someone who'd [00:09:00] never even done work experience in a legal firm in a legal specific governance role.

[00:09:05] Hannah: You know, I think our boardrooms are packed, and I don't think it's any secret, our boardrooms are packed with ex lawyers, ex accountants, and finance folks. Why wouldn't we have technology represented in a way that honours the impact it can have in our organisation and the lifeblood that it is of our organisation.

[00:09:25] Hannah: You just wouldn't even consider a board that didn't have a finance person or a legal person on the board. You wouldn't even consider it. Even someone without governance experience is a big question mark for most boards.

[00:09:36] Hannah: So how could you possibly say, you know, just because you are aware and you live in the world and you use technology that you have technology experience and you don't have any credibility in my opinion.

[00:09:46] Richard: Yeah. I think that matches really well with your point, which I agree with, that almost all businesses are technology businesses in some way, shape or form now.

[00:09:56] Hannah: Whether they realise it yet or not.

[00:09:58] Richard: Yeah, absolutely. I [00:10:00] also wanted to pick up on your point, you talked before about cyber risk. That is obviously very high on many boards radars as a key risk that businesses are facing.

[00:10:10] Richard: And I wanted to ask you to perhaps draw the distinction between a board having someone who can operate in that cyber risk space, versus the broader technology space. And what they're missing if they are too focused on cyber.

[00:10:27] Hannah: That's a really good question, Richard. I think cyber is becoming less of a conundrum for organisations.

[00:10:34] Hannah: Security sounds really intimidating until you, you sort of break it down quite simply and look at what assets do you have that require protection and what is the impact if they are somehow compromised? How bad can it go?

[00:10:50] Hannah: I think there's absolute benefits to having security specialists and cyber specialists in the boardroom, and or in your exec, and or in your [00:11:00] organisation. But I don't think it's necessarily a requirement.

[00:11:04] Hannah: Good technology people have enough exposure to the frameworks, you know, the industry standard frameworks that are now becoming sort of core for any of that sort of work. Even just thinking about our own Greenpeace experience we spun up a cyber working group nearly two years ago to consider in the wake, as I assume many other organisations did in the wake of the Medibank and the Optus breaches, to look at, our cyber readiness and our security posture and determine whether that was within risk appetite for the organisation.

[00:11:37] Hannah: We were also undergoing a risk journey at the same time where we were re-examining our risk appetite, redrawing our risk matrix. And determining at a reasonably granular level what the organisation's risk appetite was across a host of components of the organisation.

[00:11:54] Hannah: So looking at our cyber posture, we were able to choose as a working group made up of [00:12:00] a little bit of board representation, some organisational representation, and some external, specialisation from out in the market.

[00:12:07] Hannah: Look at what the industry standard framework was that made the most sense to us as a not-for-profit. You know, we don't have endless resources to have a dedicated, you know, CISO or security team. So as an organisation, what did we need to do to get within risk appetite from the board, on our side of well-being and readiness.

[00:12:26] Hannah: And you know, it's been a real journey. I'd say it was probably 18 months work to break the back of it. And now we're in a place where we're really putting the finishing touches and the finesse into exactly how this unfolds, how the reporting works, how the governance works, how the maintenance and ongoing operationalisation of that framework works within the organisation. It's certainly been a journey.

[00:12:47] Hannah: But to answer your original question, I think anyone who's got good capability and experience in the technology space, security can be intimidating and scary. Ultimately there's [00:13:00] a number of pragmatic steps you can take to make yourself a smaller target rather than a larger target and depending on your organisational risk appetite and resources, you can make pragmatic decisions around that, especially if you've got a background in technology and understand.

[00:13:18] Hannah: I guess there's a pragmatism to delivering somewhere between a gold-plated solution that is completely over engineered and doing very little and leaving yourself remarkably open. There's a wide middle path there that people should find.

[00:13:33] Richard: Great. And to change tack a bit, Hannah, I wanted to ask you a question that's quite topical, I think now with particularly the AI sort of revolution that we're undergoing at the moment. Which is just a good illustration of what has always been a challenge for boards around technology, which volume and pace of change. Like it's hard to keep on top of what is actually happening.

[00:13:58] Richard: It's pretty confusing [00:14:00] that like the AI space is a great example of how easy it is to get confused about what exactly is happening.

[00:14:05] Richard: So I wanted to ask you what practical steps boards can take or even individual directors can take to build up their skills and make sure that they do remain current, in that kind of fast paced environment.

[00:14:20] Hannah: Look, Richard, it's a question I get asked a lot. Honestly, I spend a lot of time with exec teams and boards and I get asked this question a lot. The answer in my mind is, is reasonably simple. It's three C's, Conferences, Get out and get to them.

[00:14:32] Hannah: We've got the National Tech Summit coming up in Melbourne from the 11th to the 13th of November with an incredible lineup of speakers from organisations that I, and leaders that I deeply respect across the industry.

[00:14:43] Hannah: We've just had South by Southwest in Sydney. I was up in Sydney about six weeks ago for an AI conference run by a company who's doing incredible stuff in this place called Nuix.

[00:14:53] Hannah: Get out to the conferences, you know, get amongst it. The Australian Governance Summit that the AICD puts on. I didn't get there this year, but I did go [00:15:00] last year. It was fantastic.

[00:15:01] Hannah: You know, Agile Australia is an old favourite of mine. We've got the last conference run by Tabar down here in Melbourne. Get out to conferences, hear what people are doing in organisations, talk to some of the speakers, you know, get some of that, you know, drink from the fire hose, coal face stuff.

[00:15:18] Hannah: With that comes reading and research. You know, there's plenty of publications that we can look at. So that flows a bit into the second C, which is Capability.

[00:15:26] Hannah: Go to training courses, read widely, read from publications and things that you wouldn't ordinarily read through. It's it sounds a bit, you know, probably giving away how old I am. But I spent like I do most of my, a lot of my research on Reddit, to be honest.

[00:15:40] Hannah: I find an inordinate amount of information there around AI, around security, around cyber, around technology, things that are happening in different organisations. You know, there's a plethora of, if you take the time to curate your feed, nevermind our organisational Slack and the other Slacks that you can be a part of across the industry.

[00:15:59] Hannah: They're [00:16:00] just a, an absolute goldmine of useful information. So Conferences, Capability, and the third C is Conversations.

[00:16:07] Hannah: Talk about this with people. If you're a board director, talk to your other board directors, talk to your friends who are board directors. You have networking groups and social circles that you move in with like-minded people.

[00:16:19] Hannah: I know a whole bunch of parents at my daughter's school that are in the tech space. And you know, we'll often be chatting about this as we're waiting for pickup from camp or at the school gate after school or at the school fete or whatever it might be. Have the conversations about what other people are seeing.

[00:16:34] Hannah: Test drive your thinking. Perhaps this is a little bit biased. I do a lot of my processing by talking. And if I look at a 20-year career in sales, that's how I've done a huge amount of the problem solving all across my career. Is by sitting down opposite someone talking about what problems we're trying to solve and then collaboratively, you know, bouncing off each other to engineer solutions and come up with ideas and share our experience.

[00:16:57] Hannah: So, have those conversations with people, [00:17:00] even if you're catching up with your buddies around to watch the footy, like, you know, ask them what they're doing with AI, ask them if any of them are using it. You'll get this really broad response from people that are terrified at Skynet and, you know, that we're destroying humankind through to people who are convinced they can replace their entire team with bots and increase productivity, you know, 10,000%.

[00:17:19] Hannah: So, get out there, get the conferences, build your capability by researching widely, doing training courses, getting amongst it, and have conversations. Find out what else is happening in this space. We're learning all the time and it's evolving so quickly. It's the only way that we can even try to keep a finger on the pulse.