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Management Journal Article hero
Management Journal Article

It Pays to Have a Digitally Savvy Board

Having board members with experience in digital business is the new financial performance differentiator.
Abstract

Boards of directors have many issues competing for their attention, but being digitally conversant in an era of digital transformation is quickly rising to the top of the list. Nearly all companies are looking for ways that technology can be used to improve their business models, customer experience, operational efficiency, and more—and boards must help them move forward at a sufficient pace, advocating for change by supporting and sometimes nudging their CEOs. Those that do are likely to see better financial results than those that don’t. Our research shows that companies whose boards of directors have digital savvy outperform companies whose boards lack it. And our discoveries are striking: We found that among companies with over $1 billion in revenues, 24% had digitally savvy boards, and those businesses significantly outperformed others on key metrics — such as revenue growth, return on assets, and market cap growth.

About the Authors

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Peter Weill, Chairman and Senior Research Scientist, MIT Sloan Center for Information Systems Research (CISR)

E94-1549
(617) 253-2930
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Stephanie L. Woerner, Research Scientist, MIT Sloan Center for Information Systems Research (CISR)

E94-1557
(617) 452-3222
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Jennifer Banner, CEO at Schaad Companies and Lead Director at BB&T Corporation

MIT SLOAN CENTER FOR INFORMATION SYSTEMS RESEARCH 

Founded in 1974 and grounded in the MIT tradition of rigorous field-based research, MIT CISR helps executives meet the challenge of leading dynamic, global, and information-intensive organizations. Through research, teaching, and events, the center stimulates interaction among scholars, students, and practitioners. More than ninety firms sponsor our work and participate in our consortium. 

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