Is the role of Chief Data Officer still hot or not?
The role of Chief Data Officer evolved a lot since being first introduced twenty years ago. Given the paradigm shift to the Data Mesh, some experts argue that the CDO’s responsibilities might once again drastically change. Leading to the discussion whether the role is still necessary or not.
In 2002, Catherine Doss stepped up as Chief Data Officer of Capital One. Back then, the position of a CDO and the challenges it came with were very different from how it is viewed today. Since I have been advising CDO’s for many years now, I was able to follow the evolution closely.
Lately though I couldn’t help but notice that several of the CDO’s I’ve had the honor of serving and advising as consultant throughout my career, increasingly took up new challenges, oftentimes not being replaced by a C-suite role or not being replaced at all. Combined with the everpresent talks on data-mesh at modern-day data & analytics conferences, I wondered whether this was in fact a trend rather than a coincidence.
To tap into hands-on experience I interviewed Jo Coutuer (until recently CDO of BNP Paribas Fortis Belgium - tenure 6 years), Sudaman Thoppan (until recently CDO of Allianz Benelux - tenure 5 years) and Inès Herbosch (CDO of FOD Justitie - tenure 2 years). In addition, I had the huge opportunity to pick the brain of futurologist and business philosopher Rik Vera on the matter.
Their insights helped me better understand what forces are at play, where the role might be going and what that means for new CDOs and young data professionals.
Setting the scene
First things first, to avoid any confusion, when I speak about a CDO, I’m referring to a Chief Data Officer, not to be confused with the equally recent Chief Digital Officer with whom it shares the acronym. A CDO is the c-suite role responsible for both defensively ensuring data governance and compliance and offensively ensuring data assetization, i.e turning data into value generating solutions and in some cases even new revenue streams.
The role originated and grew its first 10-12 years as a mostly defensive role, oftentimes even appointed specifically for regulatory compliance reasons. The last 8-10 years the responsibilities associated with this role have grown increasingly vast, some even say too vast.
Jo Coutuer - having served 6 years as CDO - expressed this journey eloquently:
“I was sent on a mission for (data) El-Dorado. First, as captain of the ship, I had to steer the team and company across various (regulatory) storms and currents; a serious challenge for many CDOs. When we finally made it safely across the ocean, having been thrown off-course, as a CDO you need to reorient yourself and lead the way through the jungle in search of the golden city, the promise. On our journey we came across various treasures but although valuable they did not compare to the El-Dorado which the homefront hoped.”
Steady Captain, Compass Steady Explorer and Creative Adventurer are just some of the many hats expected of a CDO to master. Indeed, CDOs are expected to be both business and tech savvy transformation agents who take ownership for data & analytics teams, programs and compliance with the increasingly stringent regulation. Taking the above into account it is no surprise the average tenure of a CDO is only 2-3 years. Will expectations stabilize or continue to grow beyond what one person can deliver?
CDO future (re)volution
Thinking about where this evolving role would evolve to next, made me wonder.
Over the past decade I had the chance to witness several data offices rise to success and then fall victim to that same success - often unable to cope with the surge in demand resulting from their hard work selling the value of data. Hence, when Zhamak Dehghani pitched her “Data Mesh” it really resonated as a logical next step.
Indeed, centralization of data governance, data management and analytics makes sense if the current state is chaotic and there is a need to take back control of the data estate. When this data estate is back in check and business has been made more data savvy it seemed almost logical that data offices would reduce back to a competence center. Business teams take back ownership of the backlog of “their'' data products and the data office coordinates data governance, manages large transversal data assets and serves as a back-up pool of data & analytics resources; almost where the role began back in 2002, a perfect circle.
This is much in line with the image Rik Vera painted of future companies who he claims should operate more like an octopus, who’s brain is distributed across its body, only some 20% of decisions are taken by the central brain, everything else is handled in a distributed way, this allows an octopus to be more adaptive; best illustrated by its ability to take on complex color patterns. Data Mesh is actually this concept applied to data & analytics.
In this same perfect-circle perspective though, a successful CDO and Data Office would be one that ultimately makes itself obsolete through change, education and IT and Business enablement, the definition of a transitory role or a transformation office.
It is with this idea in mind that I reached out to my network to try and confirm or challenge this idea and challenged it was.
Interestingly, in a small poll launched on LinkedIn 65% of participants still considered the role mostly permanent. Curiously though, filtering the result on the (ex-)CDOs or CDO equivalent roles actually indicated a 50/50 ratio.
The set of interviews also painted a very nuanced picture, some clearly considering the role transitory and others permanent.
Sudaman Thoppan explained how - in his case - the role was deliberately defined as transitional. This transitory definition was - in his case - the definition of success and a crucial element to encourage "business" to step up, because if the CDO was permanent, the business would not plan to make it their responsibility. For Jo Coutuer and Inès Herbosch the role was clearly more permanent but with an evolving set of responsibilities.
What this means is that it is of course not as clear cut as my epiphany might have suggested. Of course, the need for a CDO very much depends on the type of organization, maturity and strategic focus of the company. Moreover, as a detailed retrospective on 20 years of CDOship would indicate, the expectations of the role have become increasingly broad, finding a white raven capable of fulfilling all expectations is hardly realistic. Instead, depending on the current situation and main ambitions for data at a company, either a transitory Chief Data Officer or a permanent one might be more appropriate; there might be a need for a transformational CDO or rather a stabilizing one as suggested by one of the poll participants.
1. The Transitory or Transformational CDO (Adventurous Explorer)
This type of CDO is a strategist and a change agent, capable of convincing the company of the importance of data and analytics. Given the transformational expectation put on this type of CDO, impacting potentially all lines of business as well as IT, this type of CDO really needs to be at the C-suite table and preferably report to the CEO.
2. The Permanent or Stabilizing CDO (Steady Captain)
This type of CDO is a manager and operator who keeps the lights on, keeps business in check and advises the company as new trends in the field emerge. The field is only starting to really pick up. There are many more challenges to come. Typically, this type of CDO doesn’t need to be at the C-suite table but needs to report into a COO or CFO.
Recommendations for current CDOs and people with CDO ambition
Finally, the discussions also yielded valuable insights for both current and future CDOs to extend the tenure and avoid some pitfalls but more importantly, it also resulted in some valuable career advice and insights for all the young data professionals out there.
Firstly for current or future CDOs, the recommendations from the CDO interviews were:
- As a CDO, a major challenge is to take ownership of a business action. The CFO is by design responsible for monthly and annual closings, the COO for the operational execution, CMO for the campaigns, CPO for the product, the CHRO for hiring and retiring of staff, the CRO for risk management. Many CDOs however, position themselves as an enabler of the business teams, providing data and insights in support but without taking ownership for a business action of their own.
Recommendation: To have a permanent seat at the CxO table, you need to try and take accountability for a clear business action; Sudaman Thoppan even recommended to have this formalized in the CDO target letter and to dare take an asset management approach. As Jo Coutuer expressed nicely: “You do nobody a favor by putting yourself in the enabler position."
- To counter the continuous challenges voiced by your peers, it is a common mistake to overcompensate and overpromise, taking on too much and setting yourself up for failure. Ironically though, more established C-suite members are never asked for their business case. Results yes, KPIs yes but a business case and ROI?
Recommendation: Instead, Inès Herbosch recommends to identify 3 use-cases with a very clear ROI early on in your tenure and deliver these results with sufficient marketing. They will reduce the amount of defending you need to do and it will buy you precious time to initiate projects that will take a longer time to complete.
- A lot of CDOs evolve to this role from a data or technical background. This results in a lot of emphasis on the what and the how and too little on the why. “We are too interested in our own product and content”. (Jo Coutuer) Both Jo Coutuer and Inès Herbosch noticed we are today gradually seeing the pendulum swing the other way with CDOs coming from business into data, bringing a fresh perspective.
Recommendation: The data and analytics world has more need for business talk, more data-driven business people who are able to understand business needs and translate them into data solutions and then sell them using business terms. Rik Vera called for more (analytics) translators who can help bridge this gap and bring business and data teams closer together.
This last point is actually the perfect segway to the final recommendation, career advice for the many ambitious young data professionals out there, what skills should you develop to be most future proof? Ironically though, when many of the CDOs started building their career, CDOs didn’t exist. When many of the current data professionals grow up to become CDO, the role will have significantly evolved as it continues to be a moving target.
For the future cohort of potential CDOs, the interviews were unanimous,
Put in the effort to become more of a generalist. If you are more business oriented, be curious about the technical and analytical side of things, if you are technical, make sure that you thoroughly develop your business acumen. Rik Vera was clear that this is not easy as you need to find energy to go outside of your comfort zone but he sees a bright future ahead for those who do, the creative generalists.
In summary, contrary to my intuition, a head of data is still largely considered as a necessary and important role for the years to come, whether or not as part of the C-suite depends on the transformational ambition for data.