When the senior executives at the Swiss hotel management company Mövenpick Hotels & Resorts finally gave the greenlight for the development of a booking app after over a year’s discussion, approval seemed like just a formality, until they consulted their “shadow board” — a group of rising, non-executive employees. Nobody wants another app, their younger employees insisted, and as a result of this intervention, the company developed a direct web interface that potentially saved the company a lot of time and money.
This example was drawn from Harvard Business Review’s five-year study of more than two dozen shadow boards across Europe, Asia, Africa, and the United States. These shadow boards bring together the ideas and aspirations of rising employees, often representing the sought-after 18-34-year-old demographic, to the table to offer usually middle-aged executives a perspective they might not otherwise get.
With younger generations the driving force behind many market trends, these alternative boards address the disconnect between the senior executives they “shadow” and the generations they aim to serve. Sometimes known as Millennial boards or mirror boards, they can alert executives to those trends that may have been overlooked, offer new ways of engaging with the younger market through social media, and give direct feedback on approaches to social responsibility so important to their peers.
What Do Shadow Boards Bring to the Table?
In 2015, Gucci was one of the first companies to create a shadow board of Millennials, and they have been sharing ideas with each other ever since. The chief executive of the high-end fashion house, Marco Bizzarri, began meeting with the “shadow committee” of under-30s periodically and credited them with delivering a wake-up call to executives. As a result, Gucci’s digital strategies increased sales by 136% between 2015 and 2019. Gucci was also the fastest-growing luxury brand in 2019.
By contrast, the co-CEO of Prada, Patrizio Bertelli, admitted the iconic brand was too slow to respond to digital trends and influencers who were disrupting the fashion industry. The company’s sales dropped 11.5% during the same time period.
Companies that have been able to stay on top of social media trends and address social justice issues are more profitable. Gen Zers, for instance, value authenticity and a purpose-driven culture. It was this value that French multinational Sephora addressed when it launched its “Identify as We” campaign that was aimed at normalizing the use of make-up for any gender.
Another advantage of shadow boards is that the more transparent senior executives are and the more closely they work with younger employees, the more likely that over time these employees will stay with the company to help bridge the generational gap.
For instance, research from Gallup revealed that 86% of employees reported that their performance review didn’t inspire them to improve. This may be an indication that current methods of conducting these reviews fail to incorporate and reflect the qualities of fulfillment and a sense of purpose important to younger generations. A shadow board can provide valuable feedback that will help bridge this gap at the executive level.
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How Do Shadow Boards Work?
Shadow boards often span a variety of job positions within the company, are diverse in gender and ethnicity, and are also often comprised of Millennials or Gen Zers with different levels of work experience. This diversity allows these boards to challenge assumptions, diversify insights, and give feedback on how workers are being impacted by company policy. Lloyd’s of London insurer Beazley’s so-called NextCo board, for example, receives the same papers for discussion as the senior executives.
The Harvard Business Review study found two main benefits to a shadow board: It allows executives to test and pilot ideas especially relevant to the younger market, and it forges greater mutual respect between the two generations.
The French hotel company Accor created a shadow board, chief executive Sébastien Bazin says, after observing “that the majority of recent successful companies, mainly start-ups and digital companies, have been created by under-35s.” Bazin’s board of Millennials helped co-create the Jo&Joe brand of affordable hostels as part of a strategy to target their generation in a market dominated by Airbnb.
Interbrand’s “Horizon Board” encourages two-way mentoring as part of a shared value exchange. The company says that by exposing both senior leaders and younger board members to people they would not otherwise have worked with, everyone benefits from enhanced creativity and innovative thinking.
Shadow boards often serve another dual purpose. Not only do senior executives receive valuable feedback from younger employees, but the latter have an opportunity to gain crucial experience and are more likely to advance in their companies more quickly. Because Millennials are so hugely influential among their peers and more active on social media than any other demographic, when they get an inside understanding of a company’s business strategies, they can effectively relay this information to their colleagues.
Keys to Creating a Successful Shadow Board
A shadow board won’t be as effective if the (usually unpaid) members don’t feel heard or have their ideas implemented in some form or another. When creating a shadow board, it’s important to get very clear on the following details:
- The terms of membership
- The length of commitment
- How it is going to function
- How success is going to be measured
- How executive board members will mentor their younger colleagues
Millennials and Gen Zers who have been included on shadow boards report higher job satisfaction, receive more recognition, and are less likely to look elsewhere for career opportunities. With younger generations also looking for connection, an engaged shadow board is motivated to find new and innovative ways to increase sales and profits — which is a win-win for everyone.