Building Technology Fluency in the Boardroom: How Directors Can Lead with Confidence and Drive Innovation

Closing the Fluency Gap

Many corporate boards face a crucial challenge: limited technology literacy. This issue is especially common outside the tech sector. Often, boards either lack genuine tech knowledge or depend too heavily on a single “tech expert” to interpret complex information. This approach isn’t effective. Just as directors are expected to be financially literate, they should also have a basic fluency in technology. Without this, boards may rely excessively on management’s views, making it hard to question decisions or recognize transformative opportunities.

Embedding Technology into Business Strategy

Technology and innovation frequently remain isolated from a company’s overarching business strategy. In many organizations, these initiatives are treated as IT department responsibilities rather than strategic imperatives. This separation makes it difficult for boards to assess if tech investments genuinely drive progress. A holistic perspective is essential to ensure technology aligns with broader business goals and delivers measurable outcomes.

The pace of technological change complicates this further. Take artificial intelligence as an example: its rapid evolution requires boards to establish governance frameworks that balance innovation with ethical and responsible use. Striking this balance is challenging given how fast technology advances.

Outside Perspectives

Boards can enhance their technology fluency by engaging with a variety of voices. Regular briefings from internal tech leaders should be complemented by conversations with external experts such as venture capitalists or founders of disruptive companies. These interactions help break conventional thinking and reveal new possibilities.

Continuing education is also key. Directors should attend technology conferences as well as governance events to hear directly from those driving innovation and to stay updated on market trends. Hands-on experience with emerging technologies, especially generative AI, is invaluable. Surprisingly, many directors have little exposure to these tools, which limits their understanding of what they can achieve.

Structuring Agendas Around Innovation

Boards need to consider how their committee structures support effective oversight of technology and innovation. There is no universal solution; the right setup depends on the industry, company growth phase, and unique challenges. For example, high-growth companies have very different needs compared to those in mature or declining sectors.

Some boards delegate technology and cybersecurity risks solely to the audit committee, but this may not always be the best fit. Regularly reassessing committee roles and risk oversight ensures they remain suited to the company’s situation. In some cases, establishing a dedicated technology and innovation committee can help boards oversee not only risks but also opportunities, talent, and other factors critical to long-term value creation.

Setting the Right Tone at the Top

Boards must foster a mindset that treats technology and innovation as strategic priorities, not just operational tasks. This starts with asking management tough questions:

• How do technology investments enhance customer experience?
• Are these initiatives helping us retain top talent?
• Do they contribute meaningfully to growth?

Beyond strategy, boards should encourage a culture of innovation built on trust, openness, agility, and accountability. Success in innovation depends as much on culture as on technology itself.