Bearing in mind that personal Integrity is a scarce quality in our times, how can we attain corporate Integrity, which is a result of the actions of hundreds or thousands of employees every day?

I often posed this question to myself: How can I possibly make sure that every decision and action in my organization is honest, morally and ethically correct? Experience taught me that I couldn’t. The truth is that corporate integrity is a practice to which you have to be committed and not “a perfect state of integrity wholeness” to be attained. It entails having a “corporate integrity compass” that strongly pulls you back to the right path every time.

These are 5 pearls of wisdom on developing corporate integrity:

Pearl #1: Have a higher purpose for your organization

When your organization’s decisions and actions are driven by a higher purpose, other than maximizing profit, you are holding yourself and your colleagues to higher standards as well. You are aligning everyone behind something that transcends individual needs, and inspires them to give their best. You hire employees based more on shared values and less on expected performance. Overall, you build a culture that responds to the challenges of a purposeful mission. Because of this purity of intention, deviations from a shared “integrity compass” are less likely, although never non-existent.

On the other hand, in an organization that puts profit as the main purpose, why should employees care about anything other than their own needs? In its worst form, you build an “every man (or woman) for himself” culture. Everyone carries their own compass.

Being a non-profit organization is not a purpose. I have seen extraordinary financial results in a for profit organization with a strong “integrity compass”, and lack of ethics in a non-profit organization that lost clarity of purpose.

Pearl #2: Build an Ethics Framework but Lead and Operate on Trust

There has been an increase in laws and regulations to prevent fraud, corruption and unethical conduct in the corporate world. Codes of Ethics, anti-corruption policies, process control and audits, mandatory workforce training, hotlines, etc. are being implemented across all industries. In my experience, none of these measures will have a significant impact if the underlying principle is that employees will not do the right thing unless closely supervised, and that undesirable behavior can only be curtailed by exposure and punishment. However, these measures will severely impair your employee’s good judgement, creativity and risk taking, thus making your organization less agile and innovative.

An empowered workforce, one capable of successfully taking your organization through a digital transformation, for example, requires high levels of trust. Not only in your peoples’ capabilities, but also in their ability to make the right call when no one is watching over their shoulders or telling them what to do. I have seen extraordinary, amazing performance from people wanting to show me that the trust bestowed upon them was well deserved.

Nevertheless, trust is not a blank check. A clear statement of values and expected associated behaviors, ethical guidelines, simple process controls, spot check supervision, continuous compliance training, and zero tolerance of improper or illegal conduct provides a solid framework (corporate integrity compass) and a common understanding in which people will feel safe to act.

Pearl #3: Set the tone at the top with clear messages and the right incentives

Corporations are not corrupt or unethical, people are. We tend to blame external factors, such as a poor educational system or lack of regulation, for the increasing fraud and corruption scandals unearthing today. Collectively, we must work on building family values, better education and enforceable laws and regulations. But real change will only come from every individual taking responsibility for building their own character, practicing integrity in their everyday lives, and holding themselves accountable for their actions.

This was the hardest concept for me to understand as a leader. Integrity is an individual’s life-long practice that is put to harder and harder tests as the individual’s power and influence increases. As a top leader, when setting goals and deadlines, you must hold yourself accountable for the messages you give, the pressure you exert, the incentives you provide. It’s critical for you to be explicit – not vague- about the right way to achieve them. Take personal responsibility for the “tone at the top” that you are setting in your corporate integrity compass.

Pearl #4: Build corporate resilience

Corporations are facing increasing pressures to deliver returns for investors. Survival rates are decreasing as disruptive competition capture market share from the incumbents. CEO incentives tied to short term financial performance have been rising in the last two decades, as corporations are on the lookout for “hot shots” that will deliver just that, quickly and swiftly. There is less and less tolerance for the natural highs and lows of doing business in an environment of accelerated change. These “shortcut” pressures are in opposition to the longer path that corporations must be willing to take to preserve corporate integrity.

To win the race in the long run with integrity, you need to build a resilient organization. One that is steadily focused and aligned behind the business strategy, but flexible enough to adapt to market shifts and disruptions. One that understands that it will face setbacks, but believes in its capability to respond immediately with positive actions. A corporation that develops creative and innovative capabilities in their work force, and a culture that prides on gaining the upper hand from what seem impossible situations again and again.

Pearl #5: Be a corporate integrity activist

Today, it’s not enough to be a corporate leader with an integrity compass for your organization. Capitalism is at risk as populism is embraced as a reaction to high profile cases that reveal lack of ethics and integrity as part of formal corporate practices. There’s a need for corporate leaders to be vocal about their commitment to conscious capitalism. To publicly sanction wrongdoing from their peers, and to actively participate in forums where best practices are promoted.

This not only takes time, but also courage. You’ll be met with sarcasm and disbelief. You’ll need to disclose your failures. Maybe, you’ll have to come to terms with the end of dear relationships that remain in the old paradigm. But only by being part of a movement towards a new way of doing business, will we be able to guarantee a world where individual freedom to create value for all prevails.

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The role of Chairman of the Board and its impact on Board performance is often underestimated. Often, the criteria for appointing the Chairman of the Board has nothing to do with the leadership skills required to render the board’s full potential. A wrong choice often results in poor board performance, and, in the worst case scenario, organizational derailment.

As a board member, I’ve experienced stimulating sessions with the right agenda, brief and to the point presentations, productive debate, and clear and actionable decisions aligned with the organizational goals. On the other end, I’ve also experienced frustrating sessions, with a loose agenda, long and boring power point presentations, fruitless and aimless conversation, and ending with a feeling that the most important organizational issues had not been addressed.

In both cases, it was the Chairman of the Board’s leadership that made all the difference. Watching them closely, I came to the conclusion that there are distinct competencies or traits that are common to the most successful Chairmen.

These are the 5 Pearls of Wisdom on appointing the Chairman of the Board.

Pearl #1: COMMITTENT

Will she have the commitment? There is an increasing pressure on Board members to dedicate more hours off-session. The pressure on the Chairman is even higher. On top of the regular sessions and committees, the Chairman must allocate time for scheduled and unscheduled meetings with the CEO and other senior executives. The Chairman must also participate in building internal trust and good investor relations. She often acts as spokesperson, so time is also required for external public appearances.

She will be committed to the role.

Pearl #2: ENGAGEMENT

Will she be fully engaged in the organization’s strategy, goals, challenges etc.? This is key in setting the boards’ agenda and striking a balance with management, which has a tendency to control what is brought to the attention of the board. An engaged Chairman makes sure that all key issues, opportunities and risks are addressed. She makes sure that all relevant information is distributed in a timely manner to the other board members.

She will be actively engaged.

Pearl # 3: EFFECTIVENESS

Will she be a good facilitator? A board can quickly become ineffective or even dysfunctional if the Chairman doesn’t manage the meeting dynamics. Is someone speaking out of turn or not speaking at all? Is more than one conversation taking place at the same time? Is someone being overly critical of management? Going off on a branch with non-relevant topics? A good Chairman takes on the role of facilitator, keeping everyone focused on the agenda and making sure that the time allotted for each item is not overrun.

She will get the work done.

Pearl #4: LEADERSHIP COACHING

Will she be a good coach for the CEO? The Chairman needs to build a relationship with the CEO based on trust. Only then can the CEO be open to feedback, advice and guidance from the more experienced Chairman. And the Chairman must be willing to respect the boundaries of the CEO’s responsibility and decision making.

She will gently but firmly bring out the best of the CEO’s potential.

Pearl#5: LEARNING AGILITY

Is she an agile learner? Digital transformation is happening now in all industries. Accelerated change must not only be expected but actively pursued at the top of organizational leadership. Learning agility has to be a critical trait of the Chairman, most likely not a digital native. She must be naturally curious, open to paradigm shifts and a risk taker.

She will be able to navigate accelerated change.

Final thought,

It’s time to rethink seniority, close relationships with shareholders or the CEO, networking and influence, as the requisites for an effective Chairman of the Board. It’s time to appoint a Chairman of the Board with the right traits and leadership skills, even if she is a woman, the newest or the youngest member. Your organization’s survival may depend on it.

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Through this uncertainty, I can see 3 trends that are shaping the transformation.

TREND # 1: Personalized Learning

I don’t think the problem is a lack of awareness of the flaws of the traditional educational model. There is consensus around the fact that every student is unique and learning should be tailored to that uniqueness. The educational system hasn’t been able to rise to the challenge, thus the process driven – “one shoe for all” educational model has prevailed. There was no cost-effective way to do any different. Today, there should be no more excuses. Digital transformation technology, such as Big Data Analytics and Artificial Intelligence, will enable educators to co-design personalized educational programs for each student, track individual learning outcomes, and put forth content and assessments, “just in time” and on a “need to know” basis for each student. Pass / Fail assessments will give way to levels of achievements, like they do in computer games, allowing each student to develop at their own pace. Personalized learning must be paired with increasing levels of student autonomy. As life-long learning becomes the norm, our ability to tailor our learning experiences to our needs, filter adequate learning resources, and follow through until reaching the desired learning outcomes, will make a difference in achieving objectives for ourselves, our teams, and society at large. We need our students to build the muscles of “Learning Agility”. Nothing else will serve them better in this new uncertain, ambiguous, changing world.

TREND # 2: Project based Learning

Motivation and Engagement are the fuel for learning. We can all relate to how passionate, persistent and disciplined we can become when we pursue something that is meaningful and important to us. Children are naturally curious and eager to make sense of the world they were born into. School curriculum is built around subjects with the purpose of acquiring current knowledge about specific fields that hopefully will make students able to solve future real world problems and navigate life challenges. The relevance of the subject matter for the student is postponed to a later day. They must not only trust that the grueling hours they have spent accumulating pieces of knowledge will pay off, but that they will also be able to integrate and make sense of all those isolated pieces, and then turn them into real world answers when it matters to them. But for that, they are left on their own.

We now live in a global complex ecosystem, with high levels of interdependence and accelerated change. Up to date knowledge is readily accessible. The lines between subjects are blurred. A transformation of the school curriculum is called for. It must be built around increasingly complex real world challenges, allowing for curiosity to guide the acquisition of knowledge, and for meaning to build engagement. Teachers will become architects/designers, and/or managers/guides and/or coaches/facilitators of learning experiences for their students. There is no lack of teacher imagination and creativity in developing project based learning, just lack of autonomy. Policy makers must allow a wider berth to educators in the field, setting only general guidelines and standards. Teaching roles will diversify and so will the programs fueling the pipeline. Cognitive-learning experts and researchers, learning projects designers, student coaches, academic data analysts, etc. will all be a part of the academic community.

Project based learning has the potential to bring eagerness and enthusiasm in students and teachers coming back to school in a “I just can’t wait for school to get started” attitude so absent today.

TREND # 3 – Diverse Learning Communities

In today’s highly diverse societies and organizations, the ability to get along and work with people having different ethnicity, age, gender, nationality, values, etc. is becoming extremely important. Yet we continue to place students in cohorts of the same age, and probably the same cultural, social and economic background and ethnicity. Even if efforts are made to make them work in teams, they are lacking in diversity. How can we expect them to build the emotional and social skills required to succeed in a diverse society and workplace?

Technology is making it very easy to create diverse learning communities that students can join based on their profiles, learning stage, and interests. Through their interactions with community members they will learn more about themselves by gaining valuable insights on their values and beliefs as they learn to deal with conflicting points of view in an open and respectful way. They will learn to “listen to understand” as opposed to “impose and judge”. Community managers will make sure to keep learning communities safe and in constructive mode by managing the rules of participation, and weeding out toxic members. We are close to reaching 100% real-time global connectivity. A good part of our day will be spent in several digital social, interest and work related global networks, rather than on one- to-one, face-to-face conversations with people we trust and know well. There is an increase in discussions guiding public policy and participation in solving society issues being held online through social networks. Learning early how to contribute in a meaningful and positive way on these networks, through tolerance and respect for diversity, may be the key to achieving world peace.

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These 3 trends require a restructuring of the education system. The way it works must change. Unfortunately, obstacles will remain in the form of schools’ cultural resistance and outdated faculty unable or unwilling to learn to teach in this new paradigm. Also, in our government’s inability to keep up and make the necessary public policy and regulation changes that allows for innovation and transformation to flourish in the education sector.

Schools should seek long-term partnerships with educational technology companies or technology companies with education solutions to introduce and develop changes with adequate training and support for teachers. The private sector can also help by funding non-profit initiatives developing innovative and scalable new educational models and support their introduction in public and private schools.

Students aren’t going to wait. Even today, they are learning more about life outside of school by watching YouTube videos without any guidance. Educators shouldn’t turn their backs on this inevitable transformation. It’s uncharted territory, but as true pioneers, educators must dare to tread new paths for learning, applying these three trends as guiding stars.

Mariana Rodriguez Risco | Presidente Laureate Perú
Twitter: @mrodriguezrisco
LinkedIn: https://www.linkedin.com/in/mariana-rodriguez-risco/

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And in both cases, there is huge resistance to change, in contrast with the inevitable transformation of all things due to the Digital Disruption.

With my Education hat on, I’ve been warning the academic community and policy makers about the dangers of not being able to “think outside of the box” about our educational models and policies. About the need to understand the trends driving us towards personalized education, learning anytime – anywhere, on-line collaborative learning, etc. I trust that we will get there. Changes in Education just take their own sweet time.

To the Board I say: “don’t think outside of the box. Think like there is no box”. Time is running out for businesses that are unable to start a journey towards Digital Transformation.

“A journey towards acquiring a set of capabilities and changing a range of processes, functions, models, with the purpose of leveraging the opportunities of the digital technologies and their impact across society in a strategic and prioritized way”

Digital transformation: online guide to digital business transformation:

These are the 5 “pearls of wisdom” that I have for the Boards and Board members that are ready to start on this journey.

1. Select a CEO with the right DNA

If you don’t have the right CEO, nothing will happen. Having said that, I will advise against hiring a young digital native, because it’s still critical for your CEO to have the leadership competencies that are developed only through experience. In the CEO profile, just add and look for the one trait that can make the difference: Learning Agility.

“People who are learning agile: Seek out experiences to learn from; enjoy complex problems and challenges associated with new experiences because they have an interest in making sense of them; perform better because they incorporate new skills into their repertoire. A person who is learning agile has more lessons, more tools, and more solutions to draw on when faced with new business challenges.” (Hallenbeck, Swisher, and Orr, July 2011)

Learning Agility is a complex set of skills that allows us to learn something in one situation and apply it in a completely different situation. It is about gathering patterns from one context and then using those patterns in a completely new context.

In short, Learning Agility is the ability to learn, adapt, and apply ourselves in constantly morphing conditions.

The 5 Dimensions of Learning Agile Leaders, Kevin Cashman:

On top of the usual CEO competencies, what you need is a CEO that is humble enough to know that he/she doesn’t know everything that is going on, curious enough to explore and build on the possibilities, and bold enough to undertake the required changes in the face of incomplete information and uncertainty.

I’ve been in a situation where the Board dragged their feet when faced with the hard decision of letting go of the CEO. The fact that he had the right attitude and commitment, that there was no specific crisis going on, and that looking for a replacement was not going to be easy, made it hard. But time proved that the change was not only necessary but key to the success of the business.

2. Take the plunge and immerse yourself in Digital Technology

Most Boards are welcoming young digital natives that can add a different perspective and sense of urgency for digital transformation. That’s good, but not good enough. If the older Board members don’t speak the language, the journey will be one strewn with obstacles and setbacks. Without total alignment and a clear understanding of the scope, the commitment of resources, and the risks involved, the digital transformation is doomed.

“84% of companies fail at Digital Transformation”
(Forbes)

The average age of Board members is around 60. They are not necessarily comfortable with digital technologies. But if they want to be part of the journey, Board members need to be open to learning about these new digital technologies and their potential impact on society. They need to understand, really understand, the meaning of Cognitive AI, IoT, the Cloud, Ubiquity, Mobility, Social Networks, Big Data Analytics, Virtual and Augmented Reality, etc.

Board members need to get their hands on every piece of technology available to them, and make them a part of their lives. They need to use their smartphones or tablets -or buy one. They need to shop online, talk to SIRI to make restaurant reservations, manage traffic with WAZE, read books on a Kindle, watch a movie while waiting for a dentist’s appointment, learn “how to” (fill in the blank) on YouTube, and so on. They need to build on those experiences to gain an understanding on the way technology is changing our lives.

I’m a Baby Boomer, so this applies to me. My advice is to turn the struggle with digital technologies into a challenge, and then have fun with it.

And for a Chair of a traditional Board, the first order of business should be to create a WhatsApp group for the members and the CEO.

3. Help build the pieces of the new puzzle

Digital Transformation is not an IT Project. It’s not a project at all. It doesn’t have a beginning and an end. It does imply implementing projects, but not just the one. In my opinion, Digital Transformation is more like building a new organizational puzzle by putting pieces (smaller projects) into place. You may not know exactly how the puzzle will look like in the end, but it will become clearer as new pieces replace the old ones. The accelerated pace of technology will make it a never-ending journey, as new puzzles will soon emerge.

Digital Transformation is Holistic. It translates into profound and structural changes in the business architecture (functions and processes), and the business model of the whole organization. It requires a change of paradigm on the way we do business. It changes the balance of power as it demands co-creation and strong collaboration with your customers.

The Board needs to be in alignment with the new vision and support the CEO in the process of putting the right pieces of the puzzle, in the right place, at the right time.

The Board needs to continuously gage the risks involved in the digital transformation journey, accept the setbacks and failures as organizational learning experiences, and keep a focus on the long term.

They are many Digital Transformation Consultants, and the Board may be tempted to rest on their expertise to deliver a transformed business. It’s a good idea to have Digital Transformation Consultant(s) as guides, just don’t let them drive and don’t stay on the sidewalk, hop on the bus.

For a Digital Transformation to succeed, the Board needs to be on-board.

4. It’s about people and culture

“The journey is about acquiring a set of new organizational capabilities”. So, it’s about what your people can do, based on a new set of values and beliefs, a different culture. Don’t underestimate the need for change management as your people are asked to be forward thinkers, customer centric in every decision they make, agile and innovative, and to anticipate and welcome change as the new standard.

“The journey is about changing a range of processes, functions, models.” You must be ready to connect or furthermore destroy the organizational functions (silos) to move towards an unstructured, hyper connected network of individuals and teams that keep changing as needs arise.

This is the hardest challenge for the Board, because it needs to release its focus on what has been its main role for decades, that is, organizational control. In my experience as a Board member, the main topics have been compliance, operational and financial performance and audit reports. The main concern has been to ensure the stability and predictability of the short-term and long-term strategies and objectives. Most of the discussion has been on internal issues and responses to external threats that the business is currently facing or will face momentarily. And on how to enforce a code of conduct & ethics that will prevent a reputational crisis or regulatory non-compliance sanctions.

This is a mindset opposite to the one required for the digital transformation journey.

The biggest challenge for the Board is to change its mindset without losing control. The Board needs to turn its focus outwards to these main topics: customer behavior & expectations, market & industry disruption models, emerging technologies & societal shifts. Their main concerns need to be ensuring that leadership has the right DNA, prioritizing and supporting the changes in functions (silos), processes and models (the new puzzle) and helping and empowering employees to build the road to travel on the journey.

The Board needs to change its role from organization control to organizational agility.

This is easier said than done. The Board will ultimately be held accountable for any major deviation from the plan, for falling short on results, and for any breaches in internal controls and compliance. The slow pace of governments in adapting public policies and regulations to the accelerated pace of change brought on by digital disruption adds to the challenge.

This is where technology can help…

5. Become a Board that is driven by Smart Data and Intelligent Information

The Digital Transformation Board needs the organization to develop the capability to turn data into intelligent information with speed, quality and security. This capability changes the nature of business decisions, enabling the Business and the Board to make real-time decisions with a higher level of accuracy and effectiveness.

It’s not about managing information for better reporting. It’s about making information an asset at the core of how you do business. Big Data Analytics and Artificial Intelligence are technology enablers, and should not be regarded as a replacement of human responses. These technologies allow us –as humans- to migrate from linear to exponential thinking.

There is a new trend in Education called the Flipped Classroom.

“the group learning space (classroom) moves to the individual learning space (home) and the group space (classroom) is transformed into a dynamic, interactive learning environment where the teacher guides the students as they apply concepts and engage creatively in the subject matter”

The Flipped Learning Network (FLN). (2014) The Four Pillars of F-L-I-P.

I propose a FLIPPED BOARDROOM where all the reporting and information space (Boardroom) moves to the individual space (home/office) and the group space (Boardroom) is transformed into a dynamic, interactive, collaborative discussion environment where the Chair and the CEO guide the Boardroom members as they examine intelligent information to derive business insights, and engage creatively in the opportunities and challenges at hand.

Resistance should be expected as this new model demands a significant increase in time dedicated by Board members outside meetings to go through the information provided in an ongoing way (real time). It demands that Board members do their “homework” if they are to contribute in group discussions with their peers at Board meetings. And, for them to understand the strategy behind the digital transformation journey of the business, it demands stepping out of the comfort zone into a mindset of curiosity and learning about digital technologies and their impact across society.

On the other hand, the Flipped Boardroom will result in a more engaging, stimulating and enriched experience for the Board members, as they become co-creators of a new vision and business model.

“No industry is immune to digital disruption”

Boards play a key role on making sure that their business become the industry disruptor instead of the industry disrupted.

And for that they need to become a Digital Transformation Board.

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