Feature
As digital transformation processes change the workplace and digital workplaces, organizations look to digital leaders to manage that change.
This necessarily requires a change – or evolution – in the responsibility of those in the C Suite to such a point that Gartner has now identified the emergence of a new type Chief Data Officer (CDO). The CDO, it seems, has now entered v4.0.
The Rise Of CDO v4.0
According to a statement from the Gartner Research Board, with the increased usage of data and analytics (D&A) across the enterprise, the chief data officer’s (CDO) mindset needs to shift from focusing on D&A projects and programs to driving a product-centric organization. We believe this is the rise of a new type of leader — the CDO 4.0,” said Mario Faria, VP. She explained:
- CDO 1.0 was focused exclusively in data management.
- CDO 2.0 started to embrace analytics.
- CDO 3.0 led and participated quite heavily in digital transformation.
- This fourth version of the CDO is focused on products, and on managing profit and loss instead of just being responsible for driving D&A projects and programs.
Traditionally, technology investment has been structured as a pool of ongoing “run the business” costs and a separate portfolio of discrete capital projects that have a clearly defined beginning and end.
However, organizations are now beginning to align funding, development resources and ongoing management support around a set of enduring product lines. Gartner expects 72 percent of organizations to be using the product model this year. So what is the current role of the CDO?
Chris Bergh, CEO of Cambridge, Mass.-based DataKitchen, a DataOps, consultancy and platform provider that manages analytics creation and operations said that in their conversations with data and analytics executives, CDOs often fall short of expectations because they fail to add sufficient value in an acceptable time frame.
The average tenure of a CDO is about 2.5 years, he said and as the CDO role has largely been an invisible one focused on analytics and data gather, the role has evolved and existing CDO's need to also evolve with the changes. He has identified four areas where change needs to happen.
Related Article: 11 Necessary Skills and Traits for the Modern Chief Marketing Officer
1. The Trap of Data Defense
Data and analytics projects can be classified as either defense or offense. Data defense seeks to resolve issues, improve efficiency or mitigate risks. Data offense expands top line revenue, builds the brand, grows the company and in general puts points on the board. The challenge for a CDO or CAO is that data defense is hard. A company's shortcomings in governance, security, privacy, or compliance may be glaringly obvious. If not put in perspective, data defense is a trap that can divert the CDO's attention and resources away from activities in the data offense domain that create value for the organization.
2. The Trap of Deferred Value
Projects that implement new platforms and solutions can require months, if not years, of integration and oversight. If conceived as a waterfall project, with a big-bang deliverable at the end, these projects produce little to no value until they are complete. We call this the trap of deferred value, and it is possibly the main reason that many CDOs never make it past year three of their tenure.
3. The Trap of Data Valuation
Industry analysts and the media have long touted the strategic value of data. Following the advice of analysts, a CDO may decide to embark on a project to quantify the monetary value of your data. This seems like a worthy endeavor that should attain a high level of visibility.
A data valuation project can take months of effort and consumes the attention of the CDO on what is essentially an internally-focused, intellectual exercise. Don't confuse data valuation with data offense. Knowing the theoretical value of data is not data offense. While data valuation may be useful and important in certain cases, it is often a distraction. All of the time and resources devoted to creating and populating the valuation model could have been spent on higher value-add activities.
4. Add Value Next Week Not Next Year
What is truly important for a CDO is to add value immediately. He or she can do this by shifting more focus to data offense and using agile development to add value iteratively. “Deliver something of value to the sales and marketing team next week not next year. Build on that value incrementally. Pointing to specific instances in which the data and analytics teams helped sales grow the business is a very powerful message. It helps establish the business critical value of data in a concrete way,”
Related Article: Should the Chief Privacy Officer and Chief Information Security Officer Roles Merge?
Learning Opportunities
Webinar
Jun
6
The Future of Social Media: Emerging Trends and How to Stay Ahead of the Curve
The impact of emerging technologies like AI on social media
Webinar
Jun
7
The Building Blocks of Personalization
This webinar will explore how personalization can create powerful ecommerce shopping experience.
Webinar
Jun
8
Attracting—and Keeping—Your High-Net-Worth Investors
Join PwC to dissect their recent survey findings on a specific customer subset — high-net-worth investors.
Webinar
Jun
13
The Future of Contact Centers with AI at the Helm
Learn how to balance human intuition and interaction with the potential uses of AI to create delightful and lasting CX
Webinar
Jun
13
Learn How to Deliver Dynamic Video Experiences at Scale
Learn how to convert existing assets into video experiences in near real-time.
Webinar
Jun
20
3 Steps to Unlock Your Customer Data and Drive Revenue
Discover how Twilio Segment’s #1 Customer Data Platform helps implement data-driven strategies.
Predicting Future Trends
Another major problem for CDOs that has led to their dependence on digital technologies and their deployment said Efrat Ravid, CMO of Monument, Colo.-based Quantum Metric. Prioritizing digital above all else the CDO has to not only analyze and understand patterns in online customer experience data, but to also be able to predict future trends and get ahead of any issues that could lead to poor experiences and harm their business’ bottom line.
For any business that provides transactional services online, the CDO must understand what’s driving customers to complete transactions, as well as what’s getting in the way of those transactions and ultimately causing the customer the most amount of pain. The next challenge becomes understanding the priority level of any digital experience issues that need to be improved and closing the loop on the fixes. What’s even more crucial is for the CDO to be able to effectively communicate these customer pain points as priorities to be improved on across the organization.
As C-levels face increasing pressure to digitally transform and meet consumer expectations, the most important thing to align on is a digital strategy that is informed directly by the customer and their online journey. Not only will this ensure the brand is able to meet customer experience expectations, but exceed them, and build loyal and lasting relationships. “In order to gain this cross-functional alignment, every team needs to center around customer data as the single arbitrator of truth — which the CDO needs to evangelize from the top down,” she said.
Data Use Continues To Rise
Nima Negahban is CTO of San Francisco-based Kinetica. He pointed out that all of these changes are predicated on the rise in the use of data. The World Economic Forum says that data is so important that it is driving the Fourth Industrial Revolution. Data, the report said, ‘data grows ever more connected and valuable with use. Connecting two pieces of data creates another piece of data and, with it, new potential opportunities.’ It is this dynamic growth in connection, opportunity, and ultimately value that makes data the defining asset of this industrial era, and as such, the officer in charge of that data necessarily becomes responsible for product and business development and management.
“The role of the CDO in the Fourth Industrial Revolution is to help companies, cities, and societies manage the make-or-break shift from using data as a passive asset to glean insights into using data as an active asset that can help them respond immediately to the needs of customers and citizens, “ he said.
The CDO, whether center stage or behind the scenes, will become as significant a player on the global stage as any Head of State.
Changing The C Suite
But it’s not just the CDO that is changing. Recent research from Avado Learning and published in the Transformation in the C-suite data report, shows that large enterprises are revolutionizing the composition of their leadership in response to an increasingly complex business landscape.
The report looked at executive teams at 2019’s Fortune 100 companies over the last 6 years. It also showed that C-suite positions related to data, digital and transformation oversight have exploded, growing by more than 289 percent since 2013.
“These leaders have been hired to future-proof business models during the 4th Major Industrial Revolution,” Niall McKinney, global president of AVADO, said. “Of this new generation of C-suite titles, Chief Data Officer is the most popular, currently present in 18 percent of Fortune 100 leadership teams. Elsewhere, the fastest growing data, digital and transformation positions within the C-suite included:
- Chief Learning Officer – 900 percent growth
- Chief Digital Officer: 867 percent growth
- Chief Data & Analytics Officer: 500 percent growth
- Chief Innovation Officer: 500 percent growth
- Chief Transformation Officer: 500 percent growth
