Digital Transformation – AI or Die? The Metaverse for boards – beyond the hype
In recent years, digital and technology risks and opportunities have become prominent topics on board agendas as most businesses have evolved to be considered, at least partially, as ‘digital’.
A challenge for boards can be to understand the relevance and impact of emerging technologies on business operations and models, and the ‘hype cycle’ which accompanies these developments.
As with any emerging technology, the Metaverse has come out on the other end of the hype cycle [1]. While it gained traction until Q1 2023, public interest, trading volumes and prices fell off a cliff. Even Apple’s Vision Pro could not revive it[2]. The public interest has shifted to Generative AI Tools such as ChatGTP and other Large Language Models (LLMs).[3]
During the hype, we’ve seen some organisations fully embrace it as core to the future of their business – take the example of Facebook re-establishing itself as Meta; whilst for other organisations the Metaverse may not yet have made it to the board agenda with attention being limited or placed more narrowly on other digital technologies.
Taking a step back, to understand what the Metaverse is – according to the World Economic Forum, “the metaverse is a future persistent and interconnected virtual environment where social and economic elements mirror reality. Users can interact with it and each other simultaneously across devices and immersive technologies while engaging with digital assets and property.”[4] In simple terms, it is a virtual world where users can create avatars, interact with others, and engage in a variety of activities in a digital economy.
As the Metaverse has the potential to be a significant disruptive force in many industries and given its impact on how businesses operate, engage their customers, employees etc., it makes sense for it to be considered on the board agenda.
Boards need to be satisfied of their executive team’s ability to create and lead the digital strategy, which may include the Metaverse, and that employee skills and their ability to engage with emerging technologies need to be brought along on the digital transformation journey.
It is also important for board members and NEDs to consider the potential legal and ethical implications of the Metaverse. For example, issues such as data privacy and security, and intellectual property may become more complex in a virtual world.
Food for thought:
Has your board discussed with the executive team and advisors the potential risks and opportunities presented by the Metaverse, and considered how it will impact your industry and business by being forward looking beyond its immediate stage in the hype cycle?
Related resources:
Digital transformation: your role as a non-executive and board member
Artificial Intelligence and Boards: governance recommendations for greater positive impact
The role of boards and NEDs in driving innovation
Written by Johannes Riedl, an accomplished industry executive and non-executive director, focusing on digital transformation, cyber, and the metaverse. Johannes is the VP Cyber Solutions Europe at Cyemptive technologies. The businesses he has helped build during his nearly 20-year career include NETSOL Technologies’ European operations and their metaverse project WEOM. He is a former senior manager at KPMG. Johannes is a content contributor to NEDonBoard, Institute of Board Members’ Tech for Non-Tech course for board members.
References:
- Wired: What Does ‘the Metaverse’ mean today?
- DappRadar: Can Apple Vision Pro Turn Around the Metaverse Market Downturn?
- Bloomberg: Greylock’s Chen: It’s AI or Die
- World Economic Forum: Defining and building the Metaverse: https://initiatives.weforum.org/defining-and-building-the-metaverse/home
