30 Aug 2013
The MIKE2.0 wiki defines the Chief Data Officer (CDO) as one that plays a key executive leadership role in driving data strategy, architecture, and governance as the executive leader for data management activities.
“Making the most of a company’s data requires oversight and evangelism at the highest levels of management,” Anthony Goldbloom and Merav Bloch explained in their Harvard Business Review blog post Your C-Suite Needs a Chief Data Officer.
Goldbloom and Bloch describe the CDO as being responsible for identifying how data can be used to support the company’s most important priorities, making sure the company is collecting the right data, and ensuring the company is wired to make data-driven decisions.
“I firmly believe the definition of a CDO role is a good idea,” Forrester analyst Gene Leganza blogged, but “there’s plenty to be worked out to make this effective. What would be the charter of this new role (and the organizational unit that would report to it), where would it report, and what roles would report into it? There are no easy answers as far as I can see.”
What about the CIO?
And if you are wondering whether your organization needs a CDO when you probably already have a Chief Information Officer (CIO), then “look at what we’ve asked CIOs to do,” Peter Aiken and Michael Gorman explained in their intentionally short book The Case for the Chief Data Officer. “They are responsible for infrastructure, application software packages, Ethernet connections, and everything in between. It’s an incredible range of jobs. If you look at a chief financial officer, they have a singular focus on finance, because finance and financial assets are a specific area the business cares about. Taking data as a strategic asset gives it unique capabilities, and when you take the characteristics of data and you see the breadth and scope of CIO functions, they don’t work together. It hasn’t worked, it’s not going to work, especially when you consider the other data plans coming down the pipeline.”
And there aren’t just other data plans coming down the pipeline. Our world is becoming, not just more data-driven, but increasingly data-constructed. “Global drivers have been shifting from valuing the making of things to the flow of intellectual capital,” Robert Hillard blogged. “This is the shift to an information economy which has most recently been dubbed digital disruption. There is no point, for instance, in complaining about there being less tax on music streaming than the manufacture, distribution, and sale of CDs. The value is just in a different place and most of it isn’t where it was.”
The Rise of a Second CDO?
“All businesses are now digital businesses,” Gil Press blogged. “The digitization of the entire business is spreading to all industries and all business functions and is threatening to make the central IT organization less relevant. Enter the newly-minted Chief Digital Officer expected to provide a unifying vision and develop a digital strategy, transforming existing processes and products and finding new digital-based profit and revenue opportunities. The role of the Chief Digital Officer is all about digital governance, the other CDO role—that of the Chief Data Officer—is all about data governance. With more and more digital data flowing throughout the organization, and going in and out through its increasingly porous borders, managing the quality, validity, and access to this asset is more important than ever.”
“The main similarity between the two roles,” Press explained, “is the general consensus that the new chiefs, whether of the digital or the data kind, should not report to the CIO. Theirs is a business function, while the CIO is perceived to be dealing with technology.”
“The CDO reports to the business,” Aiken and Gorman explained. “Business data architecture is a business function, not an IT function. In fact, the only data management areas that stay behind with the CIO are the actual development of databases and the tuning, backup, and recovery of the data delivery systems, with security shared between IT and the business.”
Hail to the Chiefs
“The central IT organization and CIOs may become irrelevant in the digital economy,” Press concluded. “Or, CIOs could use this opportunity to demonstrate leadership that is based on deep experience with and understanding of what data, big or small, is all about — its management, its analysis, and its use in the service of innovation, the driving force of any enterprise.”
The constantly evolving data-driven information economy is forcing enterprises to open their hailing frequencies to chiefs, both new and existing, sending a hail to the chiefs to figure out how data and information, and especially its governance, relate to their roles and responsibilities, and how they can collectively provide the corporate leadership needed in the digital age.