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Chief Digital Officer: Vital Leader or Fading Trend?

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To hire a chief digital officer or not to hire a chief digital officer.

Is that the new question in the digital age? Could be. 

And depending on who you ask, the answer differs.

A Forrester report found just 1 percent of firms plan to hire a chief digital officer (CDO) in the next 12 months. A full 50 percent have no plans to create this executive role.

And then there's Constellation Research, whose June 18 report stressed the need for the chief digital officer. CDOs, it suggested, can help companies successfully navigate this era of digital disruption.

And don't get David Mathison started. Forrester came out with a similar report and thesis last November, which suggested that CDOs may not be the answer.

Mathison, the curator for the Chief Digital Officer Summit, told us then that these are the “glory days for digitally savvy CMOs who can now bypass IT entirely by using the cloud and AWS and BYOD. (Forrester) should be looking at the underlying reasons for the drive to hire digital leaders such as CDOs versus having the CIO or the CMO do the job.”

CIO, CMO Must Step Up

Martin Gill, vice president and principal analyst for Forrester Research and author of the report, "Trends 2014: Staffing And Hiring For eBusiness," said Forrester believes that to truly transform into a digital business, firms need a deep strategic relationship between the CIO and the CMO.

customer experience, Chief Digital Officer: Vital Leader or Fading Trendy Title?

"A CDO is often an outward signal that a CEO intends to transform, but is often also an acknowledgement that the incumbent management aren’t up to the job," Gill told CMSWire. "CDOs almost universally see themselves as change agents, and many of them see their aim is to do themselves out of a job."

CDOs aren’t necessarily a bad thing for firms to have, he added, but it can become "scapegoats" that allow other executives to assume digital is exclusively the CDO's job.

"And they can go about their business as they always have," Gill said. "To thrive in the new digital world, firms must embed digital into everything they do, not create a new digital silo."

Need a Cool Title?

Many firms have consolidated digital functions under a single digital leader, but just haven’t elevated that individual to a high-profile board level role. Gill said:

These guys often report to the CMO and manage all aspects of their firm’s digital strategy. They are taking accountability for digital strategy, governance and execution and are driving digital transformation in their firms. Do they need a cool title? Well, maybe the kudos would be nice, but that doesn’t alter their effectiveness or the results they can achieve."

Are more CDO titles coming in the next year or two? He continued:

I think we will, but not because senior executives really know what they want their CDO to actually achieve. There will be an element of 'me too' about this, and we caution that approach. Rather than worry about a fancy new role, worry more about how digital disruption is likely to impact your firm, and therefore how you must transform to embed digital skills, competencies and understanding throughout your organization. Don’t focus on appointing a single, lone digital leader. Focus on educating everybody, from your senior executives to your front-line operational staff on how trends like social and mobile will change their roles."

CDO a Strong Leader

But Constellation contends in its report, "The Case for the Chief Digital Officer," that companies need a leader "wholly responsible" and "ultimately accountable" for "driving digital business transformation."

The chief digital officer is the role to accomplish this, according to Constellation.

"The CDO needs to maintain focus above the legacy responsibilities of marketing communications and enterprise technology architecture," wrote Constellation's Peter Kim, principal analyst and chief strategy officer. "

The CDO can be an "unencumbered leader" that can drive a "digital-first mindset." CDOs can, according to Kim:

  • Formulate digital business strategy
  • Activate operational initiatives
  • Manage an organization's transformation

"The CDO must be supported by the CEO to spearhead digital transformation," Kim wrote, "and, once installed, needs to act fast to gain support up the value chain and down to the front lines."

Title image by meunierd (Shutterstock).

 
 
 
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