Technology company boards: a new model.

• Author: Kotz, Richard F.
• Position: Includes related article on Year 2000 computer problem

The traditional profile of a board member may be inadequate for a technology company. Here are the traits and attributes that companies should look for.

Many years ago, I heard a fast-track corporate executive say that he wanted his management team to be composed primarily of younger people, probably up to their mid-40s. At that time, he was also in that age range and has since been very successful in his business endeavors. However, I thought his view unusual since the traditional mode of corporate advancement, in which executives assume senior roles when they reach their 50s and 60s, was still intact. In addition, corporate directors were generally of the same ages, or older. What about all the talent and experience of those not defined as "younger management?" Why would he overlook those valuable resources?

At that time, I was unable to appreciate how profound an impact technology would have in board makeup and generally in the work force. I had no idea how many new companies would surface to create advanced technologies and new information age products. Nor did I know how much technology would intrinsically change the nature of business decisionmaking and the experience, knowledge, and skills needed to be an effective player.

The technology industry has created a new model of board directorship, requiring traits quite different from those usually sought after by traditional manufacturing and service companies. While many technology companies are following this new model, many others are still evolving. In the near future, we are likely to see the composition of technology company boards undergo significant changes.

Traditional mode

To understand technology boards and how they are likely to evolve, it is worthwhile to review the general makeup of traditional corporate boards. Although they have also undergone changes in their makeup, most boards have traditionally included a preponderance of males, most in their 50s and 60s or older. Many of these individuals are former or current corporate CEOs who provide many years of leadership experience. Given their ages, most of their careers took place before the introduction of recent technologies. It is unlikely that they are as fully conversant with technology and its uses as someone who has grown up with computers as an everyday tool.

In the last decade, there has been a marked increase in diversity on boards, with the addition of women, minorities, academics, and others who do not have a traditional business background. This positive trend has given a greater variety of experience and culture to board membership but has no relationship to greater familiarity with technology and its...