Chief Data Officers: Navigating a Disruptive, Data-Intensive World

Data is ubiquitous; it underpins every transaction, operation and interaction within today’s organizations. Data needs to be governed, architected and analyzed. Data needs an infrastructure robust enough to offer security, yet agile enough to support a lively set of requirements. In today’s dynamic marketplace, organizations need to consider whether they can continue to compete effectively without a chief data officer (CDO).

Dynamic stewardship of data

The CDO is increasingly the C-suite’s solution to navigating today’s disruptive, dynamic, data-intensive world. It’s a bespoke role that needs to be tailored to the requirements and culture of the business. At the same time, the CDO is responsible for enabling the organization with a core set of capabilities engineered for sensing and responding to changing demands.

In general, the CDO is responsible for the enterprisewide management and use of data as an organizational, often strategic, asset. This role is often tasked with acquiring and managing the capabilities necessary to drive enterprise innovation, transformation and market-facing competitive advantage through the use of data and analytics.

The research for The IBM Institute for Business Value’s 2015 annual analytics report identified 422 of 1,225 organizations having the CDO role, statistically 34 percent of the market. Adoption in 2016 has been brisk, with an almost weekly cadence of new appointments in the first quarter across industries—from banking and healthcare to travel and beyond.

Persuasive data for CDOs

The case for appointing a CDO is compelling; our research revealed that two-thirds of respondents who reported their organization is outperforming its competitors have appointed one. Moreover, organizations with a CDO are business driven, analytically mature and capable of outperforming competitors:

Business driven

9 times more likely to have business-driven data and analytics governance
7 times more likely to have a big data and analytics strategy

Analytically mature

8 times more likely to use big data and analytics technologies pervasively across their organization
5 times more likely to have an Apache Hadoop and Apache Spark platform in place

Outperforming

3 times more likely to outperform peers
5 times more likely to use data and analytics to stay ahead of competitors

Given these differentiators, we expect more organizations to embrace the CDO role. Yet, market observations indicate that many organizations fail to define the role clearly; the rate of turnover among CDOs is unusually high with few candidates retaining the role for more than 24 months.

One factor we believe underpins such a high turnover is that the CDO’s role is as multifaceted as it is amorphous: A room of 50 CDOs likely results in 50 very different job descriptions, candidate qualifications and implementation approaches. Organizations are developing and defining the role to fit their unique cultural and organizational objectives.

Organizational motivations for hiring a CDO

With our IBM Institute for Business Value report, The Chief Data Officer playbook – Creating a game plan to sharpen your digital edge, we aim to reduce this predicted failure rate by examining the various motivations for appointing a CDO and outlining the key questions an organization needs to answer as it goes about defining the role of this newest member of the C-suite.

Through our research, we have identified key patterns for consideration, both before initially appointing a CDO and after the CDO’s appointment to manage the role as capabilities evolve. Leveraging these patterns, we believe executives can make better decisions than ever about the goals, structures and priorities of the CDO role.

In the CDO Playbook report, we use quantitative and qualitative data to answer the key questions in regard to expectations, structure and priorities that every organization needs to consider when creating, or recreating, the CDO role: