Just a few years ago, few were familiar with the formal title of Chief Data Officer, or CDO. Yet here we are, living in a business world where CDOs are among the most important and influential hires a cutting-edge organization can make.
Most companies are asking this question: Do we need to hire a CDO? (And the answer is yes, by the way.)
But perhaps the real question business leaders should be asking is: Should we outsource the CDO role? (And in many cases the answer is also yes.)
But where to start? How to search? And what do you do when you find an outsourced CDO?
You’ll find all of that (and more) neatly tucked away in this article.
A chief data officer is basically a senior executive who has the responsibility of managing, governing, and exploiting any and all information that can be used to enhance the company’s profitability, security, and/or innovation.
A CDO’s data management responsibilities play out in a variety of ways, including through systems and services like advanced analytics, business intelligence, machine learning, data mining, and artificial intelligence.
It’s the CDO’s job to be privy of what’s happening in the larger marketplace and track with industry trends. However, it’s even more important that the CDO zeroes in on the organization he’s responsible for and discovers new opportunities for leveraging data in ways that move the needle on revenue and profitability.
“Data” can mean a lot of things – and a CDO has to be willing to embrace multiple roles.
Data can mean customer data – harvested from the internet – sensor data, business intelligence data, or even macro data gathered from a third-party source that provides clarity on larger industry trends.
If that all sounds a bit vague…it’s because it kind of is.
Businesses are drowning in data. It comes from inside and outside – and somebody has to make sense of it all.
That’s the CDO.
And as data demands have increased over the years, so has the demand for CDOs to manage, govern, and exploit it in a positive capacity.
Capital One is often recognized as the first company to appoint a CDO back in 2002. For many years, there was much confusion about what a CDO does, who the CDO reports to, what metrics can be used to measure success, etc. But the hope is that times are changing.
According to a survey of large organizations, just 12 percent of respondents had a CDO in 2012. By 2018, the most recent year in which data is available, 68 percent had hired one.
However, despite this steep rise, only 28 percent of organizations say the role is “successful and established.”
In other words, there’s still a lot of progress that needs to be made in order to fully clarify and maximize the CDOs role in modern business.
Any title with the word “chief” at the beginning is important – we know that much. But what makes a chief data officer, in particular, so integral to an organization’s success?
Well, it comes back to what we mentioned directly above this section.
Data is often billed as being the most important asset a company has – the crown jewel of the operation, if you will – but it’s rarely treated as such.
Very few businesses manage their information in an efficient, secure, and directional capacity.
The CDO’s job is to fix this.
He (or she) is tasked with coming in and helping organizations figure out precisely what needs to be done to make sense of all the data they’re swimming in.
A CDO usually takes on a variety of responsibilities and roles. (Many overlap with no clear separation between them). These may include any or all of the following:
If that sounds like a lot of responsibilities for one person, you’d be correct.
It’s nearly impossible for a CDO to perform all of these roles well. And that’s why it’s imperative that organizations take the hiring process seriously.
When hiring a CDO, you need a plan.
This plan should be as thorough and intentional as possible.
Will your CDO primarily play the role of Chief Data and Analytics Officer, or will he be a Data Defender and Architect?
These might sound like nuances at first, but they’re important distinctions.
As you search for a CDO, here are some things to keep in mind:
By no means is this a comprehensive list. But, at the very least, it should give you some additional factors to consider as you move forward.
According to a survey by NewVantage Partners, 34 percent of Fortune 1000 executives believe a successful CDO has to be an “external change agent” with fresh insights and perspectives.
Interestingly enough, 32 percent say a CDO needs to be a company veteran who possesses a firm and accurate understanding of the company’s culture, history, and goals.
How’s that for disagreement?
While there are valid points to be made on both sides of the issue, here are a few reasons why we believe outsourcing the CDO role is a smart idea:
Again, this is an abbreviated list. However, it gives you an idea of what makes outsourcing a CDO such a powerful decision. And as you consider onboarding a CDO, we believe it’s the best path forward.
You’ve decided to outsource the role. Now the question becomes, where do you find an outsourced CDO? And how do you onboard one in a smooth and efficient manner?
Here’s a look at some considerations:
There’s no specific model for what you can and can’t do. As you search for an outsourced CDO, take the time to carefully consider what it is you want and where you can find people who align with these desires. It may take time, but you’ll eventually stumble upon the right fit.
Even outsourcing a CDO can be an expensive endeavor, so you want to make sure it works out. Assuming you’ve carefully vetted your new CDO, success is highly predicated on proper management (on your behalf) and disciplined execution (on the CDO’s behalf).
Here are some ways you can manage your outsourced CDO and get the most out of your new hire:
Your CDO needs to feel like he can do his job. And the only way he can do his job is if he understands everything about the business, his role, and how they two collide together.
Take the time to empower your CDO by helping him understand your company’s history and culture, future goals, strengths, weaknesses, opportunities, and threats. It may take days or weeks to fully immerse him in your company – and that’s fine! Be patient and let it happen. You’re laying a strong foundation for future growth.
In addition to empowering through education, you also need to set specific expectations at the very beginning. This means creating definitive goals and objectives. They should be quantifiable and measurable so that everyone is on the same page as to what constitutes success or failure.
It’s also necessary to get clear on what happens if goals are not met or objectives can’t be met. Not to strike fear into the CDO, but to establish clear processes and accountability. The CDO should know that his job is secure, but understand that results matter.
It’s tempting to treat your outsourced CDO like someone who is on the outside looking in. And while they are (to a degree), you can’t approach it from this angle. Yes, your CDO has a different pay structure, but that’s where the differences stop. Treat him just like you would any employee and you’ll build trust faster.
Communication is so vitally important when you’re working with an outsourced professional. It doesn’t matter if the outsourced role is for a copywriting or a C-suite executive, you have to treat it all the same.
Clear lines of communication should be established early on and maintained throughout the relationship. You should feel like you can effectively communicate to the CDO, just as the CDO should feel like he can easily communicate back. It’s a two-way street (and there should be minimal friction in either direction).
The good thing about working with a CDO is that they understand the importance of numbers, key performance indicators (KPIs), and analytics. Now make sure you’re tracking numbers that show you what is and isn’t working.
You and your CDO must work together to continually measure, analyze, and optimize. This is the only way to continually improve. And in an industry where rapid change is the norm, you have to do it on a regular, ongoing basis. Quarterly and annual reports are futile. You need real-time analysis!
Nobody ever means to undercut an outsourced worker, but it happens all the time. It’s imperative that you remain cognizant of this fact and do everything you can to support your CDO so that he’s able to be efficient, effective, and productive.
The best thing you can do is openly ask your CDO for specific ways you can support and empower him. Do this every few weeks, as his needs will change over time.
While you might be hesitant to do this – fearful that he asks for something that you don’t have the resources to provide – you’ll find that the “asks” are generally fairly low.
For example, your CDO might ask to stop holding meetings before 10 a.m. so that he can be more productive. Or he might need you to upgrade a specific piece of software so that he can have greater functionality. These are things that make his job easier and simultaneously produce better results. That’s a win for everyone!
At Dev.co, we take pride in our big data development services, which include data architecture analysis, cleaning and processing data, transforming data into different formats, big data model development, data pipeline development, etc.
If you’re looking for a big data developer and/or a skilled professional who can develop an effective business intelligence platform for your organization, you’re in the right place.
Contact us today and we’d be happy to discuss and strategize!
Ryan is the VP of Operations for DEV.co. He brings over a decade of experience in managing custom website and software development projects for clients small and large, managing internal and external teams on meeting and exceeding client expectations–delivering projects on-time and within budget requirements. Ryan is based in El Paso, Texas.