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I recently read a great article by Ashley Friedlein, ‘Why a Chief Digital Officer is a bad idea’. While I completely respect his opinion, I do disagree.
Ashley Friedlein is the CEO and Co-founder of Econsultancy. He is a great author, highly successful entrepreneur and digital catalyst.
I have enjoyed much of his ideas, knowledge and rhetoric. I was prompted to be a signatory on his ‘Modern Marketing Manifesto’, and I encourage all digital enthusiasts to do the same.
The beauty of blogs and platforms like Econsultancy, is the opportunity that Web 2.0 brought us, self-expression.
After having a healthy discussion with Ashley, I have decided to elaborate on my position, which is that, for many organisations, the Chief Digital Officer is a necessity. This post provides me with the opportunity to propel the conversation and obtain more feedback and opinion.
The role of the Chief Digital Officer
The role of the CDO is not to bandaid any business problems but to solve many serious underlying problems within a business, a business that is trying and wanting to adapt with haste.
As with any department, digital teams need to be properly empowered within the organization and they need to be collaborative with other business units. Someone needs to drive this and many current employees don’t have the time, knowledge, skill-set and experience to do so.
Technology progression has occurred way too fast and a plethora of businesses have failed to keep up, in many cases they risk becoming a casualty of the digital revolution, not necessarily as a result of poor management.
Most C-level executives don’t understand digital, not this generation of them anyway. The CDO may not be needed in 15 years’ time, but companies need them now if they want to adapt and remain competitive.
All executives need to learn digital, yes, but digital experts themselves, struggle to keep abreast of the future and they are the ones that live and breathe it.
Many organisations do not have senior management experience with digital and while some staff may progress up the ranks rapidly, most will lack the skills in identifying opportunities for businesses to refine their existing operations and to open up new revenue streams through the measured application of appropriate technologies.
Whether this involves generating growth by adopting new technologies and platforms or is the result of converting and streamlining traditional analogue processes through a transition to digital systems.
The skills needed for a CDO
A CDO needs to contribute a lot more than marketing; they need to bring skills that many traditional CIOs and CMOs do not possess in business today.
Technology automation, customer relationship management, knowledge management, enterprise social, collaboration tools, digital marketing and ecommerce; they are all parts of the digital pie that need to be considered in a company’s digital transformation to grow and retain market share.
There is a lot at stake when transforming the culture of a business through visionary leadership, partnering with executives, colleagues and staff to identify and execute on the projects that will set them up for success. If this change is managed well, with a clear understanding of the business outcomes and matched by a strong vision for the future, then wild success is possible.
But if you get it wrong, then it can be a disaster. Knowing how to change is just as important as knowing when to change. Just ask AOL, Yahoo, MySpace or any number of companies who’ve struggled to make the shift.
Perhaps the greatest challenge is ensuring that brand integrity is maintained and that the business is comfortable with each step it takes through the process of change. One of the great dangers is of transformation being too complete and the company losing what intangible elements made it unique in the first place.
This is the delicate balance between all the promise of technological innovation and the core of brand values. Finding that balance point involves the courage to walk right out to the edge, and the discipline to stop short of falling over the edge. It’s not for the faint of heart, and it’s also not for the reckless cowboys.
We may look back and chuckle at the need for CDOs but many corporations need them now, otherwise we will be looking back and chuckling at the business that once was.
Businesses failing to understand the need
All of which points to a clear need for a CDO, but I believe that many businesses are failing to understand the need due to the lack of a clear definition of the role and its responsibilities.
Rather than an intrusion into the traditional roles of CIO and CMO as demonstrated by the Venn diagram, the role of a CDO encompasses much more and should really be understood as a reliever (rather than a generator) of friction.
The CDO should work with all the business units, as well as many of the possible technologies and future technology opportunities available to the organisation at large.
The CDO should work with the CIO on customer facing platforms and internal productivity solutions, helping to support innovation within the company while reducing the stress on ICT to solve every technological challenge directly.
The CDO should also work with the CMO on marketing initiatives that need any level of technology integration.
While I agree there is a massive trend heading this way, I don’t believe in Gartner’s prediction that by 2017, the CMO will spend more on IT than the CIO. In most businesses the infrastructure, hardware and software enabling costs will outweigh marketing-technology spend for another decade to come.
In saying that, I have to acknowledge that there are so many innovative tools, application, channels, platforms and tactics to benchmark and consider and these fall somewhere between the purview of a CIO or CMO.
The tasks of a CDO
A CDO needs to assist with these decsions and support growth plans and counter risks associated with digital disruption, help an organisation build online sales, create jobs and new market opportunities, and counter new competitors.
The CMO and CIO need to carry on and do what they do best, but they need to work more closely together (easier said that done as there are massive siloed problems in many organisations between these two departments).
The CDO can help bridge this relationship with their T style profile. (Ability to apply broad knowledge across situations with deep functional disciplinary skills.)
The CDO needs to educate the C Suite and the rest of the business as part of their role, so that each executive is up-skilled with digital knowledge. The CDO should report to the CEO and be granted much autonomy to work across all levels of senior and board management.
The CDO needs to work on a two to five year plan, ensure the digital plan is inline with the marketing and business plan by reviewing internal capabilities and infrastructure, talking with customers, educating stakeholders, creating a roadmap and measure outcomes. Once they have achieved their goals of transformation, then they should move on, conducting another project in an organisation needing help with digital change.
The CDO role could well become obsolete in due time. If this is the case, ex-CDOs will become GMs, many will become bigger and better CMOs or CIOs (depending on their natural inclinations, and with all the contemporary skills needed in business), or even CEOs
Digital’s battle for respect in the boardroom is still in a laggard state for many organisations and changing the culture is part of this inherent problem. Hopefully your organisation has the internal skills to adapt with agility and may not need the position of a CDO, but for many organisations, the Chief Digital Officer is an urgent necessity.