The CDO/CIO Dynamic: The Business-Of-Data Meets The Technology-Of-Data
Data is a business asset. Companies should recognize this and operate accordingly. In his 2017 study on the business of information, Infonomics, author and thinker Doug Laney, writes, “Many senior executives talk about information as one of their most important assets, but few behave as if it is.” Laney continues, “They spend more money tracking their company’s office furniture and PCs than their information assets.” Perhaps this is so because managing physical assets is easy in comparison. Data is an asset that flows through and across organizations. As anyone who has been responsible for corporate data initiatives knows, managing and governing data is hard work.
The business of information continues to challenge leading companies. The ongoing struggle is reflected in the results of NewVantage Partners annual executive survey on data and AI leadership, published earlier this month. The good news is that 91.7% of organizations report that investment in Data and AI initiatives is increasing. Also, 92.1% of organizations report that they are realizing measurable business results from their investments in data. This is where the good news end. Far fewer companies are competing on data and analytics (47.4%) and are effective at managing data as a business asset (39.7%). Even fewer have created a data-driven organization (25.5%) or established a data culture (19.3%).
These findings reflect the ongoing challenge that companies face in the quest to deliver business value from data investments. Part of this gap can be explained by the relative immaturity of data leadership roles. Organizations with a Chief Data and Analytics Officer (CDAO) has risen from just 12.0% in 2012, a decade ago, to 73.7% in 2022. However, 59.8% report that the CDAO role is nascent and evolving. Given the newness of this leadership function, it should not come as any surprise that there is much work to be done. This should be seen as good news for data professionals, where demand can be expected to remain high. The demand for data professionals will only continue to grow.
As companies think about how to manage data as a business asset, they should reflect on two fundamental and complementary dynamics of responsibility – the business of data, and the technology of data. Organizations that are effective, harmonize their efforts to blur this distinction. Understanding what is meant by the business of data and the technology of data is prerequisite to managing this dynamic and achieving positive business outcomes.
Companies are increasingly focused on driving business results from data. The mandate of the CDAO is to bring responsibility for data closer to business leaders and business decision makers. These line executives bear ultimate responsibility for making informed business decisions. Not surprisingly, introduction of a new C-suite executive role has not been universally well-received. Change is rarely welcome.
In a recently published article, CIOs Warm to the Chief Data Officer, Myles Suer, writes, “It’s taken some time, but CIOs and CDOs (chief data officers) now understand the need for a strong working relationship. Data has become the driver behind digital transformation and better business decision-making.
