A Chief Digital Officer (CDO) is a person in charge of driving company growth by making organizations less analog and more digital. His or her job is to oversee digital operations like social media, mobile applications, and virtual goods.
The CDO isn’t involved with the “how” of data movement, but is more concerned with the ways data is used.
The CDO monitors how digital technology leaves its fingerprints on purchase, delivery, service, advertising, and business processes in general. The precise job definition for the CDO is still evolving. Some see the CDO as someone who bridges the (often big) gap between the marketing and technology sides of the house. She has to have both digital and management skills, and is often responsible for the adoption of digital technologies throughout the business.
One-quarter of large global organizations will have CDOs by 2015, according to Gartner. In a press release earlier this year, Gartner said that there are more than 100 CDOs in large organizations today – more than twice as many as there were in 2012.
How the CDO Differs from the CIO
CDOs don’t necessarily have a background in IT. Peter Hinssen, CEO of Across, writes in Business Insider that, “Many Chief Digital Officers in companies do NOT have an IT background. They come from such well-reputed corporate regions as marketing, business development, or sales. From anywhere but IT, actually.”
Hinssen goes on to argue that IT and business don’t get along, and the situation has become worse in recent years. That’s because, he says, everyone’s at ease with digital technology, and the IT department’s “natural knowledge advantage” is slipping. Not everyone is so outspokenly anti-CIO, however.
The CDO-CIO-CMO Triangle
An increasingly common vision among organizational experts is that CIOs are as necessary as they ever were, but tensions among C-level executives are driving the trend toward bringing in CDOs. An Accenture survey reports that CMOs think CIOs deliberately keep them out of the loop, while CIOs think CMOs are tech-impaired and tend to go to ad agencies and outside vendors rather than first determining if internal solutions exist.
But CMOs and CIOs are each starting to accept that that they don’t have all the answers. CIOs are concerned with the how of data movement, while CMOs are mostly involved with branding and advertising. The CDO, in some cases, is seen as a bridge between the tech-focused CIO and the brand-focused CMO due to his more complete view of the customer experience that includes technology and branding.
Does Every Company Need a CDO?
Belief in the necessity of having a CDO is remarkably entrenched considering that it’s a relatively new position. But even those who say that a CDO isn’t a necessity say that it’s only because the CIO’s job will eventually morph into that of the CDO. Among those who say that the CDO has a place on the executive floor along with the CIO and the CMO say that once a CDO is brought in, the CIO should focus on tech, the CMO should focus on marketing, and the CDO should know how tech and marketing can reinforce each other.
Right now, banking, government, and insurance are the main industries to have embraced the role of the CDO. But Gartner says other industries are following, with the advertising industry rapidly warming up to the idea of having a CDO. The ideal CDO has one foot planted in the technology camp, and the other foot planted in the business management camp, and this combination isn’t easy to find. That’s why big companies are scrambling to find them.
Not all companies need CDOs, at least at the moment, but every organization can benefit from at least investigating the role, and how the addition of a CDO might benefit the organization.
About Oz Merchant
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