The Evolving Role of the Chief Data Officer in Modern Business

Presumably, if you are following this article series, you are at least somewhat aware of the way data has become one of the most critical factors impacting a business’s chances of success in the modern area.

Thanks to the increasingly digital world most businesses now operate in, enormous swaths of information are generated every single day and those businesses which have the greatest capability to leverage the maximum values from it are the ones which will see the biggest returns in their bottom line.

This brings us to the role of the chief data officer. For what is in fact a relatively new concept in the world of business, the role of chief data officer has evolved at an alarming rate to become one of the most important positions in any contemporary organization.

COVID-19

If any event has shone a light on the need for an evolved position for the chief data officer, it’s the COVID-19 pandemic. As businesses were put under increasing strain from large scale shutdowns, lockdown restrictions, and supply chain disruptions, the need for quality data became essential to survival for many organizations.

The chief data officer became the point of reference who could help guide business decisions during this time and their insight and advice was essential to developing the kind of fast and agile process which empowered companies – and not just those operating in directly related fields such as healthcare – to respond to a rapidly shifting landscape and maintain some form of continuity.

"I wrote directly to Congress about the need for valid, reliable data to help us fight the pandemic in a much more thoughtful, data-driven way,” said Informatica CEO, Amit Walia. "We also worked very closely with one of the hardest hit states in the early days of the pandemic. They struggled because they didn’t have the necessary technology. They needed to get the right data quality to analyze health issues and figure out where the virus was spreading. We helped them leverage our technology to understand how to bring the right equipment – PPE, ventilators – to the right hospitals to the right patients at the right time.”

Chief Data Officer

While the COVID-19 crisis had a significant impact on the chief data officer role, all it really did was accelerate a process which was already in motion – the evolution of the position from a steward and marshal to a key business strategist responsible for supporting critical brand objectives including:

  • Growing and sustaining revenue
  • Selling the right solution to the right customer and maximizing profits
  • Enhancing operational efficiency and reducing associated costs
  • Enhancing risk management
  • Reducing fraud
  • Improving regulatory compliance
  • Enabling new business strategies and innovation

It’s not surprising therefore that over a quarter of Fortune 500 companies maintain a chief data officer role. These people are now key players who are responsible for the instigation of innovation, the maximization of value, increasing business agility, and enhancing operational control and efficiency.

"In the United States, the CDO role originated to help inventory and improve the quality and availability of data assets,” says Deloitte. "Over the past few years, however, US based FIs–especially the largest banks and securities firms–have shifted the CDO’s focus toward enabling business strategy by leveraging Big Data to drive actionable, analytical insight-generation.”

However, the chief data officer can only reach the ultimate stage of its evolution with adequate support from the rest of the organization. If they lack adequate budget, personnel, or authority, the business will suffer in the long term as the full potential of any data strategy remains locked inside the information.

Stakeholders, especially those in the C-suite and members of the board, need to be educated on the importance of the chief data officer role and convinced to provided them with the organizational support they need to reach their ultimate effectiveness in the role.

"From board members to department heads to external financial analysts, stakeholders typically underestimate the massive effort and lengthy timeline required to whip their organization’s data assets into shape,” continues Deloitte. "Many stakeholders also assume that once on board, the CDO (with limited staff assistance) will single-handedly fix the problem when, in reality, the CDO’s first job is to define a path forward and convince others to help get the work done.”

Final Thoughts

The evolution of the chief data officer role has been meteoric, and the position is now a key determiner of organizational success. However, there remains a great deal of ignorance in the higher levels of business when it comes to the importance of this role and education must be prioritized if the chief data officer is to receive the support the role fundamentally requires.

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