The chief digital officer – threat or boon?
- 23 December, 2013 09:00
Several recent reports have suggested that CIOs are starting to feel the heat from the growing popularity of the chief digital officer (CDO), coined to replace them as top technology dog.
Gartner recently predicted that about one quarter of all companies in the world will have created a shiny new CDO seat at the senior executive table by 2015, thanks to companies increasingly looking to digitise their operations, products and services. Although Gartner believes these newly created roles are likely to coexist with more traditional ones in the short term, what will become of them further down the track?
Some say the role of the CIO and the CDO will become indistinguishable, meaning CIOs need to adapt to more external business functions to fulfill digital expectations, or face being usurped by tech-savvy CDOs. Others believe the CDO will become superfluous once digital becomes the default culture of most businesses.
But will these predictions come to fruition, or should CIOs and CDOs co-exist harmoniously in the great fabric of the company? Some say yes, but others stick to a purely highlander perspective – there can be only one.
Read on as three top CIOs share their opinion on the emerging CDO role, and what it will mean for business.
Dave Rumsey, CIO, Tourism Australia
I see the CDO as an important strategic role that acts as like the lens of the business, if you like … and that takes it from traditional methods of strategic planning and puts that digital view on top of it.
To me they are separate roles; I see the CDO working closely with the CIO and the marketing, data and PR guys, but in doing that really pulling all that together when looking at digital business opportunities that might exist, and really being that person that says ‘are we considering everything through that practical lens?’
Over the long term, I’m not sure if there will be a chief digital officer. In my mind it’s more of a change agent in an organisation that brings all those people together with an innovative mentality.
There’ll probably be some overlap between digital and IT but I don’t think it’s necessarily a bad thing.
The CDO just needs to have that real digital business view, which is more than just the tech or content side of things. Soon every company will be a technology company, so those three roles – the CIO, CMO and CDO, really need to be in each other’s hip pockets.
It’s possible that the CDO is the next incarnation of the CIO… but my experience with digital leaders is that they’re not very interested in the engine room. The results of data and what they can get out of it is very much a focus, but the platform that supports that isn’t, so the question is - with moving to the cloud and on-demand services and those types of things - will that really matter? Or will you still need people that have that particular focus like CIOs? I think so.
This is the most interesting time ever to be in the technology business, and the CIO has a real opportunity to become a technology leader in an organisation. I don’t think there should be any threat with the CDO, it’s a role that can co-exist and add huge value to any business, and you don’t have to cancel one out to make room for the other, there’s room for both.
Andrew Walduck, CIO, Australia Post
Many organisations are undergoing digital disruptions, but Australia Post has a great strategy for digitising our entire organisation.
There is a particular approach with the relationship that I have with our CMO, and he and I work really closely together. For example I might lead the digital strategy work and our CMO is leading the work around evolving our customer strategies and it’s a great symbiotic relationship.
CDOs are the champions of pushing a digital strategy, giving advice to the CEO and the board about how exactly to deliver on that strategy, and we already have all of those things running inside of our organisation.
We have a very deliberate enterprise approach, where digitisation is the responsibility of every leader, and that is woven through our corporate strategy. It’s the collective power of all the roles that comes together to really enable the digitisation of our strategy and change the culture of our business.
The CDO role is really one that needs to do a great job of connecting with customers and how we look to expose our products via digital channels. But then making sure they have a good understanding of enabling technology in an online and mobile context, and the expertise to deal with all the physical channels, the transport networks and all of the retail systems and all those sorts of things. So the role of CIO and CDO are fairly complementary of each other.
The way I see it, digitisation is more about the relationships and the capability that all these different roles bring and making sure that, as an enterprise, you can connect all those things together.
When you look at what the CDO role does, when you peel it back, it’s all about strategic advice, the digitisation of products and services for your customers, and how you make sure that you connect your customers to your mobile and social channels. If as a CIO you’re fulfilling this intrinsic part of how organisations should be run, then you’re already ticking the boxes on those capabilities, so I’m not sure it’s appropriate to say that it’s one role over the other.
Steve Coles, CIO, Allianz
If as an organisation, there’s a big gap between your current capability and where you need to be in terms of exploiting digital, I can understand the merits of establishing a dedicated CDO role to take some ownership and really drive through rapid change.
At Allianz, we’ve always tried to embed digital across all aspects of our business. I work very closely with my CMO, we collaborate on a whole host of initiatives across the business, and we both share a responsibility around driving innovation. I don’t think we would have that need for a dedicated CDO sitting between us but I wouldn’t rule it out in future.
Today, you can cope with running the main components of the CIO role, which includes managing the business and maintaining the status quo; looking for IT enabled change, and then executing that change to deliver all the big projects and programs, but over time that will become more challenging.
So at that stage you can conceivably imagine separating the running of IT to working collaboratively to influence the use of IT. Now I couldn’t say whether that’s a CDO role that will emerge, or rather someone that focuses on business transformation, of which digital is one lever that can be pulled.
IT functions have to get closer to the business to influence strategy and how to derive benefits from using technology, and some are growing parts of their organisation to be better at doing that. So in the future I can see there being a shift away from what might be considered the traditional management of IT. So the CIO role may change, but again I don’t see it as purely a digital thing.
If I joined a new organisation today, and the CMO and CDO were already in place, I would see that as potentially marginalising the role of technology within the organisation, which I think is a risk. I wouldn’t make sure we established a framework that was right for the company, and that we were building up capability to make sure that we responded to the opportunities presented through technology, but I don’t personally believe that would be the right structure for the business.
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