Why successful Chief Data Officers address different Data Voices
This article represents our private opinions and views and does not represent the opinions and views of our employers.
The role of the Chief Data Officer (CDO) is younger, unclearer, and less stable compared to other C-suite roles such as Chief Marketing Officer and Chief Technology Officer. It is subject to constant change in its scope and mandate both shaped by internal company strategy and priorities and wider data trends (for example, regulatory driven data governance, big data, artificial intelligence, data monetization, and, most recently, data mesh). The aim of this article is to shape realistic expectations towards CDOs and it allows CDOs to remain relevant in a dynamic environment.
Given the adaptive environment and extended engagement with data voices and local data teams, what is determining the success of CDOs in the future? Let us start by stating what it is not.
- Do it all yourself CDO: Maximizing the number of innovative pilots and AI models you build and run as CDO (maybe rather how many you support). This model simply does not scale.
- Defense only CDO: Only focusing on controls and restrictions preventing business from driving data innovation is not a good place to be in. Legal and regulatory requirements need to be fulfilled, however, business departments expect more help to fulfill them in a way that allows them to innovate.
- CDO as entrepreneur: Running a data monetization business as this will be a business line on its own with a general manager. Maybe this is a good career move for CDOs but not their main job, once they become GM. The company should refill the CDO position with a new leader to avoid conflict of interests.
- CDO as Data Infrastructure Leader: Some CDOs settle with just taking care of data infrastructure and do not feel accountable for the data value creation in the company. This creates a strategic gap, as there is no one to own and drive company wide data strategy.
So, if it is not one of the four mentioned above models, what’s the best approach for a CDO?
We have observed that successful CDOs and mature central data teams are able to understand, listen to and address a diverse set of different data voices in the organization that all need special attention. Some business functions have typically been numbers driven and have a strong data voice (e.g. performance management, sales, marketing) with which CDOs and central data teams have typically formed a strategic partnership. Today we see more and more business functions actively seeking to become more data driven (e.g. sustainability, corporate governance) and thus needing to engage with the data team to help them deliver value. These business functions and their respective leaders represent an opportunity for CDOs to engage in strategic conversations bringing in the data perspective to the table.
As a consequence, data teams now have many more stakeholders to interact with. These diverse stakeholder engagements provide an opportunity for CDOs to increase the level of influence to drive their strategy objectives across the organization (with a risk to become a bottleneck). For example, CDOs will have an increased opportunity to accelerate their agenda around data literacy and data culture. Another consequence is to drive the adoption of the central data infrastructure and improve synergies.
At the same time, CDOs need to realize that their primary job is to enable the business. If we find ourselves being in the way of the business, we are doing something wrong. The data voices can support the extension of capabilities into their local organizations and functional areas. Scalability can be only achieved when CDOs actively support the creation of local data teams as spokes that collaborate with each other and with support of a central hub. The focus of local data teams is to build data, analytics and machine learning products while utilizing the common data infrastructure. Central data teams can empower the local data teams and help them to ramp up while providing some services during the ramp up phase. Afterwards, these central resources can help the next team to be ramped up; a train-the-trainer approach has proven to be successful in accelerating the ramp up process.
In summary, we believe that success is found by having a seat at the table to strategically shape where the company is moving through trusted partnerships with all business units. Successful CDOs are seen as strategic partners who add business value. They provide standards and capabilities to ease collaboration across the organization and the data platform to produce, share and consume data products. And CDOs should lead the efforts to promote a data driven culture and skills that fully utilize the data platform to drive value. One way to accelerate that is through building repeatable accelerators for driving data value across units. This definition of a CDO’s role can be really fulfilling and provide more stability to the position.