Researchers at Gartner estimate that 90 per cent of enterprises will have a ‘Chief Data Officer’ (CDO) in place by the end of 2019. It also predicts that by then only half of CDOs will have been successful. So, what does the role of the CDO entail and how can they succeed? Rich Cober, Executive Vice President and CHRO for MicroStrategy explains.
The rise in the use of data in the enterprise to inform business decisions has led to a recent phenomenon—the Chief Data Officer. Gartner predicts that nine in ten organisations will have a CDO in place (opens in new tab) by the end of 2019 “to handle the many opportunities and responsibilities that arise from industrial-scale collection and harnessing of data.”
Unfortunately, the research group also forecasts that only 50 per cent of CDOs will be successful in this timeframe, due to a number of challenges. As a new role, the CDO will be in a position to increase business efficiencies and improve risk management, especially since the General Data Protection Regulation (GDPR) came into effect in May 2018.
This puts the CDO in a position where business expectations will be high, and they will have to make tough and potentially unpopular decisions, because the CDO’s role sits at the crossroads of IT and business. They will typically be responsible for defining the data and analytics strategy at their organisation. The CDO will be instrumental in breaking down siloed departments and data repositories, which will make information easier to find and will also have ramifications for the IT team.
As Gartner notes, many CDOs have faced resistance, but the successful ones are working closely with their Chief Information Officer (CIO) to lead change. To be a key part of any organisation’s digital transformation, the CDO will need a wide range of skills.
MicroStrategy’s Global State of Enterprise Analytics Report 2018 finds that 60 per cent of UK organisations already have a CDO, with nearly a quarter (23 per cent) considering creating the role.
The skills required of a Chief Data Officer
The role of the CDO is multifaceted. For this reason, CDOs need to be able to combine skills from the areas of data, IT, and business to be in the successful 50 per cent.
Data skills: A background in data science is crucial. A passion for statistics and a clear understanding of how to interpret data to glean insights is core to the role of the CDO. The CDO then needs to be able to communicate what those insights mean in a business context and make information easily available to all.
A knowledge of data security is also critical. In the UK, the Information Commissioner’s Office (ICO), whose job it is to enforce GDPR in the country, recommends the creation of a Data Protection Officer (DPO) at each organisation. This should fall within the remit of the CDO.
The value of sharing data at a senior level is recognised by UK organisations, by and large. MicroStrategy’s research finds that 91 per cent of UK management teams have access to their organisation’s data and analytics, well above the global average of 84 per cent. Further down the authority chain the picture is different, with almost three-quarters (74 per cent) of executive teams and nearly half (48 per cent) of front-line employees having access to data and analytics.
The CDO needs to ensure that those who need data to further inform decision making can do so and are sufficiently trained to gain business insights from that data.
IT skills: Understanding how information flows is an advantage as the CDO is well placed to recommend and implement technology to democratise and operationalise data, as well as improve security. The CDO will need to manage expectations across the enterprise, so appreciating what technology can deliver is key.
At the moment, 38 per cent of UK organisations have their analytics platform hosted entirely in the cloud, with half (50 per cent) using a hybrid mix of cloud and on-premises deployments, according to MicroStrategy research. The same study finds that Artificial Intelligence (AI) and machine learning are going to feature heavily in more than a quarter (26 per cent) of UK data projects, so many CDOs will need to get to grips fast with this technology.
Business skills: Strategic business logic is essential to success as a CDO. If the expectation of the CDO is to influence strategy based on data, then consulting experience will be valuable. Project management skills will be at the forefront of the CDO’s day-to-day role. Being able to bring siloed groups together and get them striving for the same common goal is a vital skill for any CDO.
MicroStrategy’s research finds that more than half (58 per cent) of UK businesses intend to invest more in data analytics initiatives in the coming year, and around two-thirds (65 per cent) plan to invest more money in the coming five years. It’s clear that data analytics is only going to be deployed more heavily throughout the enterprise, so the CDO’s role is only going to become more influential and pivotal within their organisation as different business units seek to gain insights to improve the business further.
Making a success of the CDO role
Every organisation will have different objectives and expectations of their CDO. Gartner estimates that four in every five (80 per cent) CDOs will have revenue responsibilities, meaning they will be expected to drive new value, generate opportunities, and also deliver cost savings. No pressure! Given those expectations, it’s no wonder that Gartner expects only half of CDOs to succeed.
The core responsibilities of the CDO should include data governance and quality, and regulatory compliance. The CDO must also address the way that technology is deployed to address these issues.
The CDO needs leadership and team building skills, as they will be the chief change agent in the organisation for creating a data-driven culture. This means first-class communications skills will be valuable.
The Chief Data Officer is going to be essential in delivering digital transformation. Organisations who create a CDO role must support that individual and make sure that they are integrated across departments, not isolated in a silo. The C-suite must lead from the front on this and, as we saw earlier, the support of the CIO will be critical.
Is your organisation on track for CDO success?
Rich Cober, Chief Human Resources Officer, MicroStrategy (opens in new tab)
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