Data has become more than just a buzzword — it is now the blood that runs through the veins of every organization, big or small. Raw data describes the facts and figures that a company processes every day. It includes everything your company had done, is doing and (with a bit of analysis) will do. Filtering out Raw data enables us to gain valuable information that can be then referenced and acted upon.
The ability to analyze and act on data is becoming increasingly important to the businesses. The fast-paced business environment demands that companies be equipped to react quickly to the ever-changing market dynamics. However, these quick reactions need to be given sufficient thought and backed up by relevant data points to have any positive impact.
Decisions based on gut feelings are no longer a viable option because even if you are not, your competitors are making their decisions based on a solid facts & figures.
With Data management, data protection, and analytical competency playing an integral part in the success of a company’s operations, CEOs and other members of the executive board are actively taking measures to find a person who can sort their data and make sense out of it. We refer this person as Chief Data Officer or CDO.
Who is a CDO? Why Are They Needed Exactly?
Yes, we know that the CDO does stuff with Data to help his company. But what exactly?
As Mark Gambill, CMO of MicroStrategy, a leading worldwide provider of enterprise analytics, mobility and security software solutions answered in an interview with Forbes:
You have to go back in time to understand where the need for the CDO came from. Technology became pervasive with the advent of the internet. When that occurred, everybody had information about everything, and information grew exponentially. While information offers a lot of benefits, it can be challenging, frustrating, and expensive. You have to build the right infrastructure to capture data. You need the ability to access and extract data. And then you have to convert it into insight. Extracting insights from data used to be the domain of the IT department. IT would control when a project occurred, what you got and when you got it with respect to information.
The CDO was born as an attempt to create a bridge between functional leaders who need information in real time and the IT department. In a perfect world, functional business leaders (Sales Ops, HR, marketing) want to be the masters of their information. The CDO would investigate platforms and security, and would then create an environment to allow for each individual functional user to access the information that they need. CDO’s are most effective if you have a software system that allows the end user to perform analysis off of the system. The role exists, then, to find the right BI platform so that you can have data discovery. I call this the democratization of data.
With this need recognized, most bigger companies already have a CDO in place to help them oversee data governance, management, and distribution. However, they too are quickly transforming the role of the CDO into one which focuses on creating data as a Strategic Asset that will directly impact a company’s revenue stream.
What Benefits do CDOs bring to the table?
With the digitization of business and consumerism, the volume, as well as variety of data, has increased manifold. It has changed the business needs at its very core. An IBM Global Business Services Executive Report very rightly says that where data was once used to “sense and respond” to various business activities it is now being used to “ predict and act”, thus transforming the organization into one that adapts in the present to bring out the best in the future. This transformation towards a data driven, forward thinking approach has made the CDO’s role all the more crucial.
The following are five ways a CDO’s presence benefits the company’s innovation and growth:
1. Data Leverage: This involves identifying “low-hanging” opportunities from currently existing data assets that will help in the furthering the cause of the organization. Seven out of twelve CDOs interviewed by IBM said they were able to create “low-hanging fruit” successes by deriving meaningful information and viable insights from data that already existed within their organization.
2. Data Enrichment: This involves augmentation of company’s existing data sets through a combination of fragmented internal data sources, the addition of external data sources (free ones like Government Resources & Social Media as well as paid ones maintained by data agencies) and also the integration of data from their business partners.
3. Data Monetization: An extension of data leverage, Data Monetization involves finding new avenues of earnings and revenue opportunities outside existing processes and functions — very often with direct impact on existing business models and organizational strategy.
4. Data Upkeep: This involves taking care of the health of the data under governance. In order to ensure that data quality is top notch, the CDO handles multiple aspects of data maintenance like data integrity, veracity, value, semantics and overall health.
5. Data Protection: It is a special aspect of data upkeep. It is of paramount importance to any organization given the high risks associated with failure to protect data as an asset.
Have Other Companies Started Using a CDO?
Yup, plenty of them.
With the increasing dependency on data, larger businesses have already onboarded Data Heads to create actionable points that when acted on, directly impact the organization’s performance. Gartner forecasts that almost 90% of all big organizations around the globe are going to have themselves a CDO by 2019.
The biggest name in literally every field, McDonald’s, The Guardian, Renault, L’oreal, The Harvard University, and even the Government of the United Kingdom, as well as that of the City of New York — all have a CDO to guide them through a successful Data journey.
Data is now the king of business. But to make sure your King is doing its duty right, you need a guy who can understand that data, play with it and put it in a place where it gets used in the most efficient manner. The CDO ensures that the company focuses more on doing stuff with the insight they have provided than trying to crack open up the tangled up puzzle of data.
Your data needs a leader, go get him!