Being in a management position in a company comes with great responsibility. But what happens when your peers do not see you? Or how do you measure your success? These are some of the struggles of a Chief Data Officer (CDO).
A CDO's job is described as a corporate officer responsible for enterprise-wide governance and utilization of information as an asset, via data processing, analysis, data mining, information trading, and other means. As the steward and owner of data within the organization, the CDO must lead the transformation to a "data-driven organization."
CDOs usually report to the Chief Executive Officer (CEO), although depending on the area of expertise, this can vary. The CDO is a member of the executive management team and manager of enterprise-wide data processing and data mining. This is a role of growing importance.
If you fit the above description and face challenges as a CDO, this article is for you. We will dive into the most prominent of those and present ways to overcome these challenges.
Companies are starting to see data as an asset rather than a confusing section of their business. However, not every company has grasped the importance of having a CDO yet. Despite having the C-title, CDOs are often overlooked and seen more as “nice to have” than essential like CEO or CFO.
This leaves the responsibility of showing the added value of data to the CDO and the data team: they have to indicate how they can provide critical insights based on the new data strategy. The CDO must be the evangelist who stimulates new thinking about the economic value of timely processed data and its importance as the foundation of decision making. CDOs should ask for and lead disruptive thinking on how data can be used within an organization.
As the CDO's role encompasses everything from data management to data science to business analytics, the CDO can easily get caught in the weeds of tactical work. This ultimately detracts from their main priorities of identifying opportunities to leverage and enrich existing data, tapping into new data sources, and monetizing data.
If CDOs start having to manage data or systems, they are no longer focused on implementing these business-wide strategies the way they should. If this happens to you as a CDO, remember that your job is to oversee the data team and should focus on organization-wide data governance. As with any massive undertaking, Chief Data Officers shouldn't spread themselves too thin: they must leave the actual data functions strictly to the Chief Information Officer (CIO)'s department.
Currently, there is also a lack of meaningful metrics to measure the effectiveness of the CDO's role. This makes sense since the linkage between data and revenue or impact in an organization tends always to be indirect and spans over longer periods of time. After all, organizations aren't usually selling data itself, but products or goods that rely on this data. So when the return on investment of centralizing and organizing information is challenging to measure, stakeholders may be less willing to give it the support it deserves.
In order to be able to present a competitive advantage, CDOs must establish clear metrics against their goals from the very beginning of their role.
If handled correctly, the impact of a CDO on an organization can be significant and lasting. From creating business value and managing firm-wide risk to reducing cost and driving innovation, CDOs are crucial to data-driven transformation, and organizations would be smart to know how to unleash this role for maximum success.