By Russ Banham, Contributor
Today, the current pace of data production is estimated to be 2.5 quintillion bytes per day. To get a sense of this expanse, 2.5 quintillion pennies would cover the Earth’s surface - five times - if laid out flat. This figure is only set to surge with developments in IoT. A 2017 IDC report predicted a ten-fold increase by 2025 - 30 per cent of which will need real-time processing.
All of this data equals untapped business value, with innovations that make company operations more efficient, online interactions more seamless, and recruitment and hiring more aligned with business strategy. Yet given this exponential increase in business data, experts say it is wise for companies to hire for specific roles to manage its development and application.
“If you look at the meteoric rise in data from a business strategy perspective, you need to develop ways to collect data, cleanse and archive it, and apply analytics to it to extract insightful information,” said Jim Johnson, Senior Vice President of Technology Staffing Services at Robert Half, a global job search and staffing firm. “This isn’t just `bits and bytes.’ You need people with the right skill sets who understand the data and digital transformation strategy to bring it to fruition.”
‘Jobs of Great Importance’
Entrusted to garner these benefits are CDOs - yet, here is where things amplify. The acronym comprises of two types executive leadership roles - chief data officers and chief digital officers - each unique, yet both focused on data oversight, and in high demand as companies transform operations to understand, analyse, and monetise it for business purposes.
“They are both focused on data, realising its core value as a business asset,” Johnson said. “But fundamentally they have different corporate missions.”
This explains the recent hiring spree for both types of CDOs. According to a 2018 Forrester survey, more than half of companies have appointed a chief data officer, and 18 per cent are preparing to do so in the future. (Another survey by NewVantage Partners pegs the hiring per centage higher, with nearly two-thirds of companies hiring for the role - a considerable leap from the 12 per cent that employed such executives in the firm’s 2012 survey.) Similarly, a PWC study indicated that 60 per cent of chief digital officers were hired between 2015 and mid-2017.
“Every company is going through a digital and data transformation or darn well should be,” said Johnson, who helps companies hire for both types of CDOs. “This compels them to find people to lead these initiatives.”
The question is, what do these roles look like? (And does your organisation need one?)
Chief Digital Officers: A Business-Savvy Bunch
In essence, chief digital officers own customer-related analytics and metrics. What’s more, they are responsible for harnessing these insights across the organisation, developing digital approaches to solve business problems. An example in a manufacturing context is analysing supplier data to determine ways to enhance supply chain efficiencies.
Chief digital officers typically have backgrounds in sales, marketing, or customer service, as well as knowledge of how to use innovative technologies to enhance business functions. These leaders generally partner with sales and marketing executives to streamline and improve the customer experience across mobile and digital channels, and at times will guide the development of marketing and advertising strategies.
These responsibilities, however, are evolving. “Chief digital officers are now being asked to take on the additional role of business information analyst,” Johnson said. “Given these newer job tasks, the best chief digital officers need to have significant strategic, financial, operational, and interpersonal communications skill sets, in addition to technological chops.”
Chief Data Officers: Data Science to Boot
By contrast, the chief data officer is charged with managing the access, analysis, and dissemination of data to effect better business outcomes. To do that requires transforming the enterprise around data to identify new product opportunities, enhance customer experience, improve regulatory compliance, spot competitive challenges earlier, and make operations leaner and more efficient.
“Anything that involves data can have an impact on financial performance,” Johnson explained. “We’re now at the point where technology is beginning to catch up to the massive volumes of structured and unstructured data being generated. What used to be stored in a database is now stored in the cloud, where it can be sliced and diced into insightful bits of knowledge.”
Given the focus on data and analytics, these CDOs often have backgrounds in mathematics, computer modelling, and data science. Typically, they lead the Data and Analytics department that is focused on achieving the corporate vision for enterprise-wide data access, use, and governance.
A recent Forbes Insights study shows this is no easy task - almost 80 per cent of executive survey respondents said 40 per cent or less of their organisation’s data is available for sharing across the company. “It’s up to the CDO to make data available for use by all parts of the organisation - to identify business opportunities and solve business problems,” said Johnson.
One example is the wide-ranging use of data in the insurance industry, where data drawn from image recognition software embedded into drones is improving the underwriting of homes and office structures, as well as data within claims filed by policyholders which can help customers mitigate potential losses.
An Evolving Role
The responsibilities of both CDOs are expected to become broader, as newer technologies like deep learning, blockchain, and the IoT burgeon. Business disruption is a constant today, requiring companies to stay on top of the latest digital and data trends - and the technologies that power them - to remain competitive.
This responsibility is the job of the CDO, both of them, albeit in different ways.
“Many CEOs perceive CDOs as `change agents’ - digital and data transformation specialists,” said Johnson. “Now and in the near future, it’s a job that holds great importance.”
Russ Banham is a Pulitzer-nominated financial journalist and best-selling author writing frequently about the intersection of business and technology.