While you may have initially hired your Chief Data Officer (CDO) to protect your company’s critical data and to establish governance processes for how to use and store that data, if you have limited them to that scope your organization is missing out. Today’s CDOs have emerged as key drivers of strategy and commercial success, who are able to seamlessly integrate risk management with forward-thinking strategies. They bring commercial expertise, strategic thinking, and predictive analytics to the role.
There are four main leadership archetypes in data and analytics, and the needs of your organization will drive which CDO is your best fit.
Based on our work with companies across Europe, we’ve found there are five key steps C-suite leaders can take to unleash the full power and potential of their CDOs.
- Be thoughtful about whom your CDO reports to and make adjustments as needed. The reporting structure of CDOs varies, but there is a growing trend of CDOs reporting directly to CEOs and who have access to the board. In the banking sector, for example, CDOs often have strong relationships with the board as directors seek a deeper understanding of data's potential. CDOs can build these board relationships to advocate for their companies within the C-suite. Alternatively, if your CDO is more commercially oriented, the best person for them to report to may be the COO or even the CIO.
To attract CDOs from other regions, be prepared to adjust compensation levels. Compensation for CDOs varies widely across regions. In the United States and in Singapore, CDOs typically receive higher compensation than in Europe, which makes attracting U.S. candidates to European positions near impossible. Given the rising power of data, increasing the compensation package to attract the CDO who can guide your organization is often more cost-effective to do at the outset than to lose out on competitive business advantages or expending additional resources to adjust and recalibrate a data strategy that didn’t pan out because your CDO didn’t have the expanded skills that your business requires.
Look for influencing ability when hiring a new CDO. Influential CDOs who can collaborate without being perceived as aloof or arrogant stand out in the field. Balancing visionary thinking with practical implementation strategies is vital, and CDOs who instill purpose and forward-looking excitement within their teams create a culture of innovation and continuous improvement. These qualities are essential for unlocking the full potential of data leadership.
Position your CDO for future board service. With boards needing more depth of tech knowledge to oversee strategy, CDOs can be valuable directors. CDOs who can demonstrate experience in making data core to the company’s strategy or informing a transformational pivot for the business would bring a high amount of value to boardroom discussions. The opportunity to understand and see risks and opportunities through a board member’s eyes is an invaluable experience for a CDO, which not only helps the CDO to prepare for future board service but also gives your board members additional education about the future of data and what it can bring to your organization.
Connect your CDO and Chief Artificial Intelligence Officer (CAIO). As more organizations are adding a CAIO to their leadership teams, it’s important to ensure that data and AI are not being siloed off. There is strength in deep end-to-end ownership of data for both the tech and commercial sides of the business. For both of these roles, a key responsibility is to educate the organization on the power of data, which includes employees, the board and their customers, and guide them through tech transformation. Together, the CDO and CAIO can have a much more influential impact in driving these changes. Treating these roles as more of a tech partnership also keeps the path for growth for the CDO open; if your data leader is being kept away from the commercial side of the business it limits their capacity to influence the organization and potentially even their own development.
By following these steps, organizations can unleash the true power of their CDOs and position themselves for success in this data-driven era. Embracing the expanded role of the CDO, from protector of data to strategic visionary, is the key to unlocking commercial success and propelling organizations to thrive in an evolving landscape where data-driven decision-making reigns supreme. The time has come to unleash the transformative potential of CDOs and revolutionize the way businesses harness the power of data.