The rise of the chief data officer
“Data! Data! Data! I can’t make bricks without clay.” So said fictional sleuth Sherlock Holmes, frustrated at a lack of evidence. Today, this “clay” is everywhere, produced by organisations at an eye-watering rate, with the onus on modern day Holmeses to put it to their advantage.
Step forward the chief data officer (CDO), whose job it is to collate and decode the many packets of information harvested by organisations minute by minute, then communicate, advise, and construct an evidential basis for strategy.
The job itself is embryonic, with Capital One reportedly appointing the first ever CDO in 2002. In many cases, executives are the first to hold the position within their organisation. Nevertheless, more than half of the Fortune 500 now has a CDO, according to research by NewVantage Partners.
But unlike the more familiar initialisms of CEO, CFO and CMO, the newness of the CDO role means it is yet to be squarely defined. The same survey found that 72% of organisations felt the job description remains “unsettled”, with only 28% calling it an “established” role.
So what is a CDO? What does a good CDO look like? What are their responsibilities, who should apply for the job and how could it evolve in future? It’s time to answer these questions once and for all.
The demand for data-focused senior leaders began around the millennium with new laws governing digital interactions. Legislators saw a need to steward data-based exchanges between people and service providers; CDOs ensured their employers toed the line.
However, the role has evolved. While CDOs remain an organisation’s digital security guard, the job now also encompasses elements of business development. A modern CDO is responsible for improving business outcomes by underpinning strategies, encouraging innovation and cutting waste, as well as complying with the law.
“Paramount to the role is being able to deliver measurable outcomes for the business,” says Jonathan Westley, CDO at Experian. In his view, the job is about change management, communication, and commercial acumen, not just number-crunching.
“These traits provide the ability to define a progressive roadmap that influences not only short-term improvement in data quality, but also the evolution and disruption of business models,” he says. “CDOs help to quantify and prove the ROI of data initiatives in the context of real business value, like customer satisfaction, revenue, or operations excellence. In some businesses they also set the guard rails for the use of data across the organisation.”
The CDO’s work overlaps with that of the chief information, digital and/or technology officer, but the skillset is entirely different. While a CTO is responsible for the smooth operation of software and hardware systems and a CIO looks after digital assets, an IT background isn’t a deal-breaker for a CDO.
More important is the ability to identify and prioritise high-value data, whether it’s retail customer conversions, the efficiency of an engine or pressure points in a supply chain, and build a case for action that can be presented to the board. This means storytelling is also key.
According to Alan Jacobson, chief data and analytics officer at Alteryx: “While there are many similar sounding titles, data science leaders are typically agents of change who leverage data science to help provide guidance to operations, as well as implementing new optimisation and automation into the business.”
The simple answer is “everyone”. What organisation wouldn’t benefit from crystal clear analytics on its customers, suppliers, products, people, competition and market opportunities? Couple this mission-critical information with data governance, the other string to the CDO bow, and you’re left with a role that feels indispensable in the modern era.
Like oil, data takes time to locate and extract, while refining it is a complicated process.
