At an all-company meeting last fall at Cisco Systems in Silicon Valley, Chairman and CEO John Chambers made an important point about Cisco’s customers. “In the future, every company will be a technology company,” he said. “Bank of America will be a technology company specializing in banking. Uber will be a technology company specializing in transportation.”
Chambers was illustrating the profound impact of a myriad of simultaneous technological transitions affecting our daily personal and professional lives. The evolution of the Internet, the global proliferation of application-enabled mobile devices with video capabilities, the explosion of “cloud” based technologies, and the wide use of social networks are all converging to create a wicked brew of risks and opportunities. Never before have established companies been at greater risk of disruption. And never before has it been easier, and less costly, for a new company to enter huge markets and threaten established incumbents. Take, for example, start-up “unicorns”—highly valued, young, private companies that attract venture capital and quickly reach valuations of more than $1 billion. The list of such companies has never been longer, signaling the value investors are placing on the rewards to be accrued, in large part, from technology-based disruption.
Does this mean, then, that colleges and universities are destined to be technological organizations “specializing in higher education”? Some argue that technology will never replace traditional models of teaching and learning. Others argue that online delivery models will ultimately dominate how higher education is offered and consumed, despite a sketchy start. Still others argue that higher education will exist in a hybrid milieu, in which technology will be ubiquitous in the modern college classroom, with professors creatively leveraging various technologies to maximize the learning experience.
Regardless of the future terrain, what is hard to refute is the expectation that every college will need to expand its technological know-how if it is to maximize the student experience, drive needed efficiencies in administration, connect more effectively with prospective students and alumni, and be equipped to receive and meet the expectations of today’s students who arrive on campus with a very different, and advanced, set of habits and expectations regarding technology.
Given this backdrop, how should boards plan for and govern strategic planning and investment in information technology? More specifically, how should boards organize the process of assessing their existing IT capabilities, defining long-term strategies, setting proper priorities, and allocating investments?
A Standing Committee on IT—or Not?
Some colleges and universities, including Lafayette College where I am a trustee, have responded to these challenges by creating a separate board committee on information technology. Is this the most effective approach? Given the sweeping influence of technology, should it be thought of as a separate silo managed exclusively by geeky experts? After all, isn’t information technology a key ingredient in nearly every aspect of the college or university’s experience and successful operation?
The question of whether to create a separate committee on technology depends in large part on the institution’s point of reference and experiences. Not every college or university is alike, and some are quite mature in their approach to IT. Most, however, are still focused on managing infrastructure services through a traditional division or department of information technology. If the position of chief information officer exists, it is seldom a cabinet-level role, and this individual thus is not involved in all aspects of institutional strategy and management. Conversely, some institutions have given such an officer cabinetlevel status. Whether to put a strong IT leader in the president’s cabinet is one of many key decisions a board should consider in determining its governance model for IT.
But regardless of the structure that an institution eventually adopts, it is important that the institution’s leadership consider information technology’s reach. For example, from the board of trustees’ perspective, a board committee on facilities should worry about the ongoing costs of providing appropriate technology for every new academic building or residence hall. A board committee on external affairs should worry about the institution’s web presence and use of social-networking tools to promote its brand and connect with alumni. Its committee on academic affairs should consider investments in instructional technology as it addresses curricular innovation and faculty recognition. Its committee on development and advancement should work to leverage technology to research, develop, and nurture its pipeline of donors. Finally, there are many other institutionwide considerations such as risks involving data privacy and IT system security that often fall under the oversight of the audit committee. The baseline consideration is that all these areas of institutional life, and probably others, are increasingly likely to rely heavily on IT.
Obviously, boards also should be very concerned about the impact of IT costs on annual budgets, and they must deal with the growing demands for upgraded infrastructure that are increasing exponentially. It is a simple fact that appetites for technology among students, faculty members, and other campus constituents are rising faster than budgets, creating a conflict between the costs of refreshing existing infrastructure and finding the resources to fund new state-of-the-art facilities, smart classrooms, and other instructional technologies.
At Lafayette College, where I have chaired the board’s committee on information technology, our journey began seven years ago after board members answered “no” to many of questions regarding IT fundamentals in the checklist for boards that accompanies this article. We began by forming an ad hoc committee that included our most technology-savvy trustees, administrators, and faculty members. We then amended the board’s bylaws and promoted the committee to formal status a year later. Lafayette’s committee on IT oversaw the development and execution of Lafayette’s Master Plan for Technology. Leveraging this plan, the college established a cabinet-level position of chief information officer, upgraded its technological infrastructure (network, storage, telephony, web presence), streamlined IT expenses, expanded support of instructional technology, implemented a new governance model for IT projects, and upgraded just about everything else related to IT capabilities. The work of the committee and the support from the board positioned Lafayette as a recognized leader in higher education IT. That is not the end of the story, however. Having reached a level of confidence in the maturity of all of the institution’s IT operations, the board voted last month to sunset its committee on information technology. The time had come to trust the many new practices established and to hold the president and the chief information officer responsible for managing IT challenges properly across the institution.
The board of trustees is still vigilant, though. Even with its successful track record, the outgoing IT committee and the full board have engaged in robust debate concerning what could go wrong. As a result, we are putting in place strategies for ensuring that the college does not backslide in its practices. One of the most important of those strategies is establishing a strong board of IT advisors, including external experts, to regularly counsel the president and her cabinet on technological trends and to provide expert advice to the CIO and his annually refreshed master plan for the college’s IT.
To underscore the need for board vigilance and as a final reminder to the full board of the importance of across-the-board thinking in the management of technology, the outgoing members of the board IT committee handed out coffee mugs as a parting gift to the full board. Imprinted in Lafayette’s maroon and white colors was the phrase “Need IT with That?"—a reminder to all board members that managing and governing technology is everyone’s job, and not solely that of a specialized committee.
Lafayette College may not yet be a “technology institution specializing in higher education,” but its holistic management of information technology has prepared the institution to confidently tackle the disruptions challenging higher education today. Other institutions might learn from our example.
A Checklist for Boards
In setting out some relevant questions facing today’s college and university boards, a simple checklist would focus on several areas:
- Are existing IT services working well and properly staffed?
- Are the networks and systems reasonably state of the art and working effectively?
- Are IT systems secure and are there up-to-date policies and practices in place to protect the privacy of data?
- Does the institution understand the full costs of technology supported through its annual budget, including the annual costs of “refreshing” various technologies?
An IT Master Plan
- Does the institution have a master plan in place for information technology that is well aligned with the strategic plan for the institution?
- Does the board understand the content of the plan and the path for its implementation?
- Is there a mature governance model in place, executed at the cabinet level, that regularly reviews requests for spending on IT projects and sets appropriate priorities among them in the context of all other requests for capital and operating funds?
- Are appropriate procedures in place so that the board fully understands the ramifications of requests for IT projects and has the ability to track the return on investment of all funded projects?
Board Awareness and Aptitude
- Does the board include technology-savvy trustees who can recognize and understand risks and opportunities in the IT arenas?
- Does the board regularly evaluate trends in higher education technologies as part of institutional strategy?
- Has the board put in place a faculty-development process to help faculty cope with, adapt to, and leverage appropriate technology?
Cooperation Among Board Committees
- Are IT considerations regularly addressed across the various board committees?
- Are all committees of the board required to identify their own needs for technological support?
Capital Allocation Processes
- Are the board committees dealing with investments and other financial policies “technology conscious” of the trade-offs between investing in technology versus other institutional priorities? Are they aware of the return on investment in technology?
- Can the board see clearly how the institution weighs investments in technology within the context of its entire budget?
Those are just a few key diagnostic questions. If a board answers “no” to most of the questions, it might be time to “amp up” its governance by establishing an ad-hoc committee to begin the journey toward a more sophisticated grasp of the institution’s IT challenges and potential investments. Establishing a formal committee later on would depend on the gaps discovered and the focus required to close them, both of which are institution-specific considerations.