SME boards to be trained in digital transformation: “It benefits the whole ecosystem”

This post is also available in: Danish

Many boards of small and medium-sized enterprises (SMEs) are simply not good enough at adapting to digital technology and digitization. That’s according to Annabeth Aagaard, Professor of Digital and Sustainable Business Development. She is responsible for a new board training in digital transformation, which is a collaboration between BSS – Aarhus University, Center for Small and Medium Enterprises – and the Danish Technological Institute. The decision-makers in SMEs need to better understand digital development and how to best utilize the many technologies strategically and commercially.

“The program is for both current and future board members and owner-managers who are better equipped to lead their companies through the digital transformation. These are people who make major strategic decisions, so they need to be better equipped to support the necessary digital transformation,” says Annabeth Aagaard, Professor at the Department of Management at Aarhus University.

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She sees a great need for guidance among many SME boards who often don’t know how to approach digitalization or how to create value through digital technologies. This can have consequences for those who don’t get on board.

“There is a high risk that they lose competitiveness. That’s why it’s also the responsibility of boards to understand and make digitalization visible in companies. They simply risk losing market share to competitors who are not standing still in this area,” says Annabeth Aagaard.

For the benefit of the entire ecosystem

If the understanding of technological possibilities is strengthened in the boardroom, it will spill over into the startup environment.

“By educating SME boards to see more opportunities in technological solutions, we also create a stronger market for startups. This benefits the entire ecosystem, as these companies are often super attractive to each other,” explains Annabeth Aagaard.

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According to Professor Annabeth Aagaard, there are good reasons to invest in digital skills, not only for the individual company, but also to strengthen an emerging ecosystem and provide more opportunities for tech startups in particular.

“Startups can provide unique offerings and solutions for SMEs. The better understanding of technology a board has, the more interesting it becomes to collaborate with startups. Ultimately, a good digital transformation benefits the entire ecosystem,” she elaborates.

Attracting the best talent

Technology has become such a big part of everyone’s everyday life, education and working life that SMEs must also take their digital strategies and investments seriously to attract talent when hiring new employees.

“You risk missing out on talent, especially young people who expect a high degree of digitalization. It should be part of the overall strategy to invest in this area so you hire the right people,” says Annabeth Aagaard and continues:

“A lack of digital expertise creates a high risk of misinvestment. You simply make stupid decisions if you don’t understand the technology. Many make themselves easy prey for external consultants who don’t always sell the best solution, instead of having the knowledge in-house to make the right investment.”

Digital transformation can be seen on the bottom line

The new board training in digital transformation is a collaboration between BSS – Aarhus University and the Danish Technological Institute. Therefore, it’s not just buzz words and platitudes about digitalization – the participants dive into the digital technologies in a very tangible way. When you understand the technologies, they can also be translated into concrete improvements, development and innovation.

“There are so many things that can be improved with digital technologies. But of course, it doesn’t matter which solution you choose. The right technology can provide more efficient operations, value added digital services and a better customer experience. Ultimately, you can see this on the bottom line,” says Annabeth Aagaard.

She concludes by pointing out that 99% of companies in Denmark are SMEs. Therefore, an increased focus on digitalization is necessary to increase value creation – even in manufacturing companies that have traditionally not used advanced technology.