In the digital age, the value of data has increased exponentially, causing most legacy businesses to appoint Data Czars (Often called Chief Data Officers) to help organize information and unlock the enterprise value of this emerging asset.
But while the appointment of a CDO is a great step, most candidates lack the superhuman powers that would be required to deliver information alignment on their own. In reality, because data is a shared asset, this transformation must be owned by the entire company; no amount of individual genius can change that.
Data has never held more latent value; a reality that is reflected in the acceleration of salaries for top chief data officers. But what separates the top CDO’s, now making millions and reporting into the executive committees and presenting to boards, from their peers?
In the absence of actual superpowers, the top CDOs are evangelists, focused on influencing and educating stakeholders both up the business value chain and in the grassroots of the business, to multiply the impact of their insights and efforts and activate the company at large. While team sizes and delivery resources vary widely across top CDOs, the common attribute they share is an ability to leverage the entire organization to drive change and execution, as opposed to just those in their direct line.
“As a Chief Data Officer builds her/his organization, think not just about acquiring good technical and subject matter experts, but about finding leaders who can evangelize the mission, working directly with partners to show them value at the grassroots level. Organizations need to be retrained to leverage data; the CDO cannot wave a wand and create this value on her/his own,” explains Charlie Stack, Consultant at Spencer Stuart.
Focusing solely on the arduous tasks of complying with regulatory requirements and delivering ‘clean data’ is not sufficient; the business impact of these activities is hard to measure and harder still to market internally when asking for investment and buy-in. If the CDO wants time and attention from the business, he must go beyond reactive data management to deliver data-driven growth and innovation, seizing opportunities to drive revenue growth, engage more effectively with customers and optimize processes.
“When it comes to transforming an organization into a data-driven enterprise, Chief Data Officers play the single most important role.” states Thomas Bodenski, Partner at Element22. “Priorities for a CDO may vary based on an organization’s business objectives, but there is broad agreement on one overarching top priority: leveraging enterprise data to drive business value. It’s actually the single most important priority.” continues Bodenski. “The good news is that many top CDOs have found that only incremental additional investment is necessary to generate significant business value from regulatory response-driven activities,” adds Stack.
The ideal Chief Data Officer is a business leader who creates and executes data and analytics strategies to drive business value. The role is responsible for defining and implementing the strategy and methods by which the organization acquires, manages, analyzes and governs data. It also carries the strategic responsibility to drive the identification of new business opportunities through more effective and creative use of data.
Every CDO should be driven to find answers for the following questions:
- How can we do more with the data we have?
- How can we augment our data, by supplementing and complementing it with data from external sources?
- How can we derive knowledge and insights from our data?
- How can we leverage insights to improve our performance?
- How can we generate business value from the investment we’ve made in meeting regulatory requirements?
As the world around us becomes more connected, the threats facing established businesses will increasingly come from new, data-driven companies. In order to compete in this new ecosystem, these businesses will need CDOs who can fix not just the quality and consistency of legacy data, but the operating practices of the enterprise, yielding shared material gains.
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The opinions expressed are as of November 2015 and may change as subsequent conditions vary