One of the most critical roadblocks to achieving at‑scale impact with digital and AI (D&AI) transformations is having a sufficient bench of domain leaders. These are the N-2 and N-3 executives (that is, those two to three levels below the CEO) who lead a domain (either a business line or function) and drive end‑to‑end transformation with AI (see sidebar, “What is a domain”). AI tools are everywhere, but the skills to apply them to real business problems—improving customer experience while driving down unit costs at scale—are not.
Having these domain owners is probably the single most critical role any business needs for its AI transformations. The CEO has to lead the transformation overall, and the C-suite needs to align on priorities and enterprise capabilities to enable AI. But it’s the domain leader who has the operational responsibility for translating the visions and plans into real change and real value.
That focus on the domain is particularly critical because most, if not all, companies we have studied derive the majority of their benefits from a few deeply transformed domains.
So, while it’s important to build up the tech-savvy skills of everyone in the business, we will focus this article on the domain owner. The most effective domain owners can speak to customer needs, strategy, organizational design, and operational performance—the traditional executive muscle. But they also have built up a “second muscle”: being tech savvy enough to develop an AI-enabled transformation road map, understand modern software delivery, and appreciate the health of their data estate, technology platforms, and engineering talent.
We are, however, far from having enough domain leaders today. Our analysis of LinkedIn profiles of senior leaders in Fortune 500 companies indicated that just 17 percent of their skill set is technical by nature, and only 5 percent of their careers included holding a technical role.1 That’s not surprising. Historically, tech‑capable leaders tended to build a career in IT.
Despite the shortage of domain owners with strong AI muscles, a model for what it takes to be an effective domain owner—and how to build the corresponding tech muscles—is emerging.
How do you build a second muscle and become a domain owner?
Building your AI‑savvy quotient is an ongoing job; don’t expect a tech boot camp and the occasional meeting with start-ups to be sufficient. Building this second muscle—and keeping it from atrophying—takes intent, discipline, and long‑term focus.
Learn like it’s your mission
Many companies have sophisticated training programs, but at the end of the day, domain leaders understand that they need to own their learning journeys. We call them “fearless learners,” and they are driven by curiosity and a passion to broaden and deepen their knowledge.
Citizen Bank’s Boyd spends six to ten hours a week discussing and learning about tech-related matters. This comes in many forms: protecting time to read about the latest developments, exchanging views with technology leaders at his bank, meeting tech vendors and consultants, attending sprint reviews, going to conferences, visiting other financial institutions that have done novel things, meeting with fintech start-ups, taking online courses, et cetera.
Schwab’s Hathi described how important it is to actively look for opportunities to deepen your learning. For example, as a board member of a health company, she is a member of the National Association of Corporate Directors (NACD). When she was considering continuing education course options, she decided to deepen her knowledge of cyber and took a 30-hour course on cybersecurity risk.
Fixate on value and reimagine what it takes to get it
AI pretenders chase a quick proof of concept to check a box on their performance review. “Using tech” leads their thinking. Van der Winden never starts with technology. Instead, he starts by asking what the biggest problems are, and then he figures out if a technological approach might solve them. “I’m not a data scientist,” he said. “What I’ve learned is to identify the attractive problems worth solving.”
That essentially means domain owners go after business problems that are worth getting out of bed for. Our rule of thumb is that the potential value of a transformational effort should generate 20 percent of incremental value. Domain owners are particularly open to new ways of doing things in search of that value. They go beyond improving processes to reinventing journeys and breaking orthodoxies.
We are seeing the latest iteration of the importance of this mindset with AI agents. Companies finding success with agents don’t focus on individual use cases or simply automate existing processes; they are reimagining end-to-end workflows to take advantage of agent capabilities.
This mindset is grounded in a firm understanding of what AI can do, and it cannot be delegated. As Hathi put it: “Many business leaders who are less tech savvy will simply say they don’t understand tech and turn technology challenges—or opportunities—over to IT to solve.” The result of this impulse to delegate is often constrained thinking and marginal improvements rather than using tech to unlock substantial new value.
Understand the operational levers to get value from tech
It’s never just tech when it comes to extracting value from tech. Domain leaders understand that ensuring technology delivers on its potential requires integrating systems—both technical and organizational. This systems-level thinking is essential to successfully rewiring the business.
Read the full article by Dana Maor, Eric Lamarre, and Kate Smaje / McKinsey
