Data is now an omnipresent fact of life for the majority of companies, ingrained in every aspect of strategic planning and decision making across every department. In the recent 2016 NewVantage Partners survey, 62.5% of firms said they have implemented at least one big data initiative, significantly up on the 31.4% of firms who reported the same result in 2013. This is not a number likely to decline any time soon, as the Internet of Things (IoT) and wearable technology introduces another influx of data into companies’ systems.
Given its importance, it seems foolish not to have someone on the C-Suite in charge of ensuring its potential is being maximized. This is something increasingly being recognized by companies. Gartner estimates that 90% of large companies will have a Chief Data Officer (CDO) in place by 2019. However, at present only roughly half employ someone in the position, often relying on a CIO, CTO, or others to lead their data efforts among their other responsibilities. This is the wrong move. Responsibility for the data is a full time job, and cannot simply be lumped in with other technology initiatives.
The role of the CDO is to ensure that data is given the strategic importance it needs by other decision makers, that it is exploited properly, maintained, and managed throughout the organization to provide a competitive edge. They define and execute the agenda of how data is used, and lead the creation of a data-driven culture in which various departments and business stakeholders collaborate to take advantage of insights gleaned from the data. They establish uniform definitions, standards, and governance practices to ensure all employees are not working at crossed purposes. They are also best placed to identify new data management technologies that have the potential to help the business, and they are well positioned to push for new investment to purchase it - as well as other resources such as staff that can help the company best execute their data strategy.
The main challenge for CDOs is asserting their authority on other executives who may perceive data to be a threat to their livelihood and ideas, believing it to diminish the value of their experience or gut instinct. As such, the CDO is really a leadership position role as opposed to a technology role. In a recent survey by recruiters Russell Reynolds Associates, 300 CEOs and CDOs were asked to rate the top leadership competencies necessary for a CDO, finding found that technical skills were actually ranked bottom in terms of the qualities needed. Stakeholder management ranked top, followed by storytelling and communications skills, then vision and innovation.
There will be upwards of 50 billion ‘things’ connected to the Internet by 2020, and not just smartphones, tablets, and coffee makers, but devices that power our world - all of which will be collecting data constantly around every facet of our lives. Someone is needed on the executive board to take control of this. Data is now an organization’s most important commodity and it needs a specific person that can define and execute a company-wide data vision so that it is value is fully realized.