The rise of the Chief Data Officer and what it means for business
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Special report: The average C-suite has a CEO, COO, CFO, and CMO. Depending on the business, there might also be a CTO (Chief Technology Officer) or a CSO (Chief Science Officer).
But research from global research firm Gartner predicts that 90 per cent of large organisations will have another by 2019: a Chief Data Officer.
“Business leaders are starting to grasp the huge potential of digital business, and demanding a better return on their organizations’ information assets and use of analytics,” the report states. “It’s a logical step to create an executive position — the CDO — to handle the many opportunities and responsibilities that arise from industrial-scale collection and harnessing of data.”
Sean Smith, the CEO of Wangle Technologies (ASX: WGL), says his company is already involved in data insight generation. Wangle has developed network-optimising technologies in conjunction with real-time big data analysis to create unique solutions to societal issues.
We sat down with Sean to discuss the rise of the CDO and what it means for business.
What is a Chief Data Officer?
The CDO is responsible for developing and leading a company data strategy, and for maintaining the overall governance required of a company’s data activities.
Why would a company appoint a Chief Data Officer?
Almost every business is awash in data-driven opportunities and challenges due to a number of fast-moving changes in the world. Cheap large-scale data storage, increasing numbers of data capture methods, the rise of machine learning capabilities, cross-territory data movement and the constantly changing legal frameworks of data governance make this role critical for companies hoping to compete in the world of tomorrow.
Couldn’t that be done by another member of the organisation? Is it just a fancy name for an already existing role? Or is it a necessary adaptation?
In the past, the components of data management and governance have been split across multiple areas of most organisations. So for example, technology teams would manage disaster recovery methods via data warehouses, marketing teams would manage segmentation and data-driven marketing execution, finance teams would manage transactional data analysis, dedicated analytics teams would manage customer or product insight generation, and legal teams would manage privacy and governance issues.
For most organisations, it’s largely impossible to create a comprehensive data strategy and governance framework when ownership is split across so many areas of the business. Therefore, a new leadership role is very necessary to get group alignment to company data strategies.
And not only that, but the creation of a company CDO signals to the business, the industry, and to potential employees that the company is serious about the importance of data for its future.
Given how ubiquitous data is becoming then, how does a company and a CDO tackle the issue of privacy?
The level of data commercialisation today is staggering and vastly more advanced than the general public realise. The recent backlash to the Australian’s government’s public launch of the My Health Record gives an indication of public feelings on the matter.
The public have a deep mistrust of uncontrolled corporate access and use of their personal data, with legislators and organisations both needing to take the public’s concerns seriously.
Organisations have traditionally addressed these concerns with dedicated Privacy Officer positions or legal reviews of data handling practices. Now that data strategy encompasses so much more than just permissions, it is critical to have a single point of presence who is dedicated to the broader challenges and opportunities.
The CDO offers that singular focus—in a way that balances governance with commercial needs—and can direct the relevant teams on how best to manage and ultimately commercialise their developing data assets.