As businesses welcome digitalisation with open arms, a number of organisational shifts have occurred to ensure the protection and utilisation of their most prized possession – data.
Consequently, in recent years, the role of the Chief Data Officer (CDO) has become vitally important – responsible for both protecting and making sense of this ever-growing and vastly-complex asset governance. Yet, despite being a relevantly new role within most UK organisations, the CDO is already experiencing a change in core responsibilities to incorporate an increasing focus on analytics.
The rise of the Chief Data Analytics Officer
Traditionally, the CDO has been responsible for enterprise-wide governance as well as using data to support wider decision making. This has included undertaking data processing, data analysis, data mining, and information trading – ensuring that data patterns are presented to decision makers in a way they can understand.
However, in just a few short years, the world that UK organisations operate in has changed dramatically. With the growth of the digital economy, traditional companies are required to make fast-pasted, accurate and forward-looking business decisions to keep up with their digital counterparts. Therefore, as traditional businesses have undergone digital transformation, there has been an increased focus on data science and analytics to meet this need. According to a recent report, 85 per cent of organisations globally are using AI in deployed applications. However, according to PwC, only 30 per cent of UK executives would describe their organisation as highly data-driven. This highlights the need for someone in the business to drive forward the use of analytics for corporate strategy and innovation.
Over the next twelve months, many businesses will see their CDO make the leap from data whisperer to data advisor. They will take the wheel and drive strategic, data-driven change throughout the organisation – using analytics to turn data concepts into transparent, actionable steps for the whole organisation. With this change will come a new title – Chief Data Analytics Officer.
The evolving role
Now a critical strategic player at a board level, the CDAO will be responsible for far more than data governance or decision support, and the responsibility is felt all the way through the organisation. A key part of this role will be mapping digital capabilities to strategic prioritises to ensure that data usage patterns (with alignment to domain/functional mapping) inform decision making and coordinate optimisation. The CDAO will also be required to serve as an executive sponsor whilst also being an intermediary between stakeholders, during the digital transformation process. This will further allow businesses to reconcile their data-driven insights to support business objectives and assist in democratising the technology throughout an enterprise.
Similar to analytic tools processing and interpreting information from data patterns, the CDAO must interpret information from the analytics to reconcile data-driven insights with business goals.
This evolved role will also see the CDAO take on the responsibility for measuring the new efficiencies introduced and gauging ROI. With the CEO and CFO responsible for making a business profitable, this will be critical for determining the progression of a company, the success of their digital initiatives and presenting it back to these key stakeholders in a way they will understand. Finally, the CDAO will need to be responsible for developing ways to attract and retain top analytics talent.
The CDAO role is multifaceted and requires attention from both an innovation and communication perspective, with the confidence to deploy new systems and the ability to permeate knowledge throughout the company. Pioneering this data-driven environment will not be straightforward, but the rewards for the CDAO, and the organisation, are unparalleled.
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Despite the value that CDAOs can provide, they also face significant challenges. The shift from data control to data transformation requires movement away from data and IT being fed into one department to it being democratised across all areas of a company. This transformation requires a profound cultural change from employees at all levels – senior leaders, managers, analytics specialists and translators – and a new culture of IT and data practices with them. Despite identifying a need for change as an organisation, overturning outdated processes and practices may be met with opposition from existing employees for whom change is daunting. To combat this, the CDAO must encourage widespread confidence in development initiatives through effective communication and skills training.
The growing importance of data and analytics to business priorities would imply that the CDAO is warranted a position on the board of executives. Just 10 per cent of directors in a McKinsey survey stated that they fully understand the industry dynamics of the companies they serve, with just 21 per cent claiming to fully understand current strategies. With the CDAO pioneering strategy based upon data, their position on the board is paramount in enhancing communication and ensuring leadership fully comprehend their business objectives and the manners in which to achieve them. With evolving challenges and priorities, the traditional hierarchy within business must adapt to align with evolving responsibilities.
As mentioned earlier, the CDAO is responsible for developing ways to attract and retain top analytics talent. Yet, due to the shortage of talent around data and analytics, this can be problematic. According to a recent survey, commissioned by Alteryx, one in three business and IT decision makers in the UK are experiencing a shortage of talent as this is hindering them from becoming data-driven.
A skills shortage is problematic for the CDAO as data literacy is integral in informing business initiatives which facilitate development. In fact, a Gartner survey indicates that 64 per cent of managers don’t think their employees skill sets are sufficient for future skill requirements. Furthermore, 70 per cent of employees don’t believe they have mastered the skills they need for their jobs today. Timing is critical. The World Economic Forum estimates that 54 per cent of all employees will require significant reskilling by 2022, with European Commission figures suggesting that 37 per cent of workers lack the basic digital skills required for their roles. Through championing data workers with easy-to-use, code-free analytics platforms, the data literacy gap is directly addressed through user-friendly and educational analytics tools.
Nonetheless, solutions are available to businesses who seek them. By adopting training initiatives and acknowledging the shortage of workers, data and analytical proficiency will become increasingly widespread because of the increased demand for their expertise. Regardless of technical acumen, organisations are seeking to up-level data skillsets by constructing educational models which are understandable and transparent to fortify themselves against their competitors.
Our data-driven world
The growing importance of analytics and data-driven insights is increasing the necessity for a CDAO to assist in digital transformation. With the evolution of the role encompassing continually transformative responsibilities, the CDAO role is only going to take on more significance in the coming years. Although there will be hurdles along the way, with regards of data literacy shortages, business management and innovative technologies, persistent effort in integrating a CDAO into your business will prove paramount in optimisation and evolving with our times.
Alan Jacobson, Chief Data and Analytics Officer, Alteryx