DataIQ Leaders has considered the role and position of CDOs in organisations previously (see: “CDO v CIO – The battle for the boardroom”), but usually from an organisational perspective. At a recent dinner event, a more personal approach was taken – do individual CDOs view CIOs as competitors for a position in the exco and do they even have an ambition to be on the board?
This briefing paper summarises the conversation and the somewhat surprising conclusions it reached. It is worth noting that two of the participants had recently left organisations in order to take up new CDO roles where they report directly to the board, albeit without having a seat on it, suggesting there is a link between the career development of leaders and their ability to negotiate for a high-status position.
The board’s attention, not a seat on the board, is what matters
In both cases where CDOs had moved to one level below the board, these were in first-time roles for those organisations, one in a medium-sized business, the other in what is effectively a start-up within a large global corporate. For the two leaders, it was the opportunity to have an impact which encouraged them to move, even persuading one to report to a board-level CIO, something he had sworn never to do again following a bad experience in a previous role. In that business, both roles are aligned around a transformation project and the CIO has recognised the need for a CDO to support those objectives. There is an appropriate level of reporting, trust and freedom.
The other newly-created CDO reports to the group chief digital officer, but the role will move to be under the chief marketing officer. Previously, this individual reported to a CIO who did not understand the importance of data.
By contrast, a charity has just appointed a new CIO at board level to drive a digital transformation and represents data at board level. This should lead to foundational projects that will open up data access because the CIO does understand its value.
The set-up within a global insurance group’s data and analytics function is even more complicated with some reporting into the underwriting community and others to life insurance. New reporting structures are being introduced under product CEOs. The CDO role is recognised as important, but there is an ongoing discussion about whether the role should be close the P&L or a cross-group function. Data science is discussed at a senior level, but this has been hard to achieve – it needs an advocate.
Communications with stakeholders and the board are critical – the CDO needs to get the message about data across. That needs to be expressed in terms of what benefits there will be for the CEO and the board. The problem is that many board members do not understand the complexity of real-world data deployment. Some C-suite members even think they don’t use data, despite the fact that it underpins everything they do.
So the challenge for the CDO is how to get the internal culture up to speed if they are not allowed to get close to the business issues and strategies which are driving critical decisions. Similarly, maturity is key to the decision to create a CDO role. The C-suite needs to appreciate data before they will make this move. At a certain point, it gets recognised that a central data office and centralised analytics are necessary. That is when the role can get the hearing and support it requires to be effective.
As a consequence, one surprising outcome of the discussion was the discovery that CDOs do not necessarily have ambitions to be in the C-suite. While they may want personal status and recognition, plus investment and support for their function, this does not translate into a relentless pursuit of promotion. In fact, most see this as undesirable because it will take them too far away from the day-to-day practice of data and analytics which is their real motivation.
CDOs really, really don’t like CIOs…
A logical organisational model would have the CDO responsible for the data, with the CTO managing the tech stack. This leaves open the question of what role the CIO plays. The view among CDOs over dinner was that the CIO role has sprung out of CTOs who don’t really care about information. The push to create a CIO role was also seen as coming from management consultancies who benefit when a new senior role is created.
One leader summed up the general view as, “CIOs are CTOs with good PR.” (To the annoyance of a CIO in an insurance group I later mentioned this to who responded, “data is just a small part of what I do.”) CIOs are viewed as having created a fear factor that led to an artificial distinction which may not be long lived. If the technology dimension is taken out of the CIO role, what is left is actually a CDO.
By contrast, however, CDOs do not want ownership of the tech stack which supports their work. In part this is a recognition of the greater level of flexibility and trial-and-error that underpins data and analytics. CTOs have a clear outcome in view and will plan their way towards it. For CDOs, however, outcomes are not always evident in advance – the process involves failing fast in order to find the optimal state. That would not be tolerated in the IT function because of the technical debt it wold leave behind, but CDOs can clean down and start over.
That said, one warning given was, “don’t go big” – this is seen as a significant mistake that data offices make because large projects have a high propensity to fail. Start small, deliver some wins and build a reputation are the foundations of a successful strategy (and career).
Role congestion is an issue on boards which is another factor in the squeeze being seen that may stop CDOs moving into the board room or having to compete with CIOs to sit alongside CTOs. “You don’t need all three,” pointed out one leader. With chief marketing officers pushing for boardroom presence and some chief information security officers making the case for their own seat at the table, it seems that CDOs are the most likely to step aside.
Do what has impact – and leave the rest behind
In the two organisations which have just appointed their first CDO, it is with a view to them acting in the v3.0 version of the role. That means finding value-creating applications for data, rather than concentrating on data governance (v1.0) or centralisation of data assets (v2.0). If CDOs do have aspirations to the most senior positions in a business, they must pursue this strategic vision, not tactical activities.
Similarly, CDOs need to become translators between the board, business stakeholders and their home function, able to “speak geek” as well as finance and strategy, explaining how data-driven activities will impact on the share price and risk management, as well as customers.
CDOs need the ability to show the organisation that, if they do things differently by applying data, it could be a different organisation. It is not about sitting on the fence (or the board) – it is about rolling the dice.
