The CDO/CIO Dynamic: The Business-Of-Data Meets The Technology-Of-Data – Forbes

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Data is a business asset. Companies should recognize this and operate accordingly.In his 2017 study on the business of information, Infonomics, author and thinker Doug Laney, writes, Many senior executives talk about information as one of their most important assets, but few behave as if it is.Laney continues, They spend more money tracking their companys office furniture and PCs than their information assets.Perhaps this is so because managing physical assets is easy in comparison.Data is an asset that flows through and across organizations. As anyone who has been responsible for corporate data initiatives knows, managing and governing data is hard work.

The business of information continues to challenge leading companies.The ongoing struggle is reflected in the results of NewVantage Partners annual executive survey on data and AI leadership, published earlier this month. The good news is that 91.7% of organizations report that investment in Data and AI initiatives is increasing. Also, 92.1% of organizations report that they are realizing measurable business results from their investments in data.This is where the good news end. Far fewer companies are competing on data and analytics (47.4%) and are effective at managing data as a business asset (39.7%). Even fewer have created a data-driven organization (25.5%) or established a data culture (19.3%).

These findings reflect the ongoing challenge that companies face in the quest to deliver business value from data investments.Part of this gap can be explained by the relative immaturity of data leadership roles. Organizations with a Chief Data and Analytics Officer (CDAO) has risen from just 12.0% in 2012, a decade ago, to 73.7% in 2022. However, 59.8% report that the CDAO role is nascent and evolving. Given the newness of this leadership function, it should not come as any surprise that there is much work to be done.This should be seen as good news for data professionals, where demand can be expected to remain high.The demand for data professionals will only continue to grow.

As companies think about how to manage data as a business asset, they should reflect on two fundamental and complementary dynamics of responsibility the business of data, and the technology of data. Organizations that are effective, harmonize their efforts to blur this distinction. Understanding what is meant by the business of data and the technology of data is prerequisite to managing this dynamic and achieving positive business outcomes.

The Business of Data

Companies are increasingly focused on driving business results from data.The mandate of the CDAO is to bring responsibility for data closer to business leaders and business decision makers. These line executives bear ultimate responsibility for making informed business decisions. Not surprisingly, introduction of a new C-suite executive role has not been universally well-received.Change is rarely welcome.

In a recently published article, CIOs Warm to the Chief Data Officer, Myles Suer, writes, It's taken some time, but CIOs and CDOs (chief data officers) now understand the need for a strong working relationship. Data has become the driver behind digital transformation and better business decision-making. For CDOs and CIOs to succeed, they must succeed together. It hasnt been a smooth evolution for many organizations.Suer continues, CIOs have historically viewed CDOs as an additional bureaucrat who would gum up the works. CIOs also claimed CDOs would not be accountable for a total solution, but instead would leave it to the CIOs and architects to do all the work. However, this attitude has changed as the twin force of self-service business intelligence and digital transformation have brought data to the forefront of the enterprise agenda.

My colleague John Ahrendt, who served for 16 years as head of consumer data and analytics at Wells Fargo Bank, has seen how ownership for the business side of data has become the primary responsibility of the CDAO, with a focus on analytics and business results.The technology side of data has been the historic domain of the CIO, with a focus on data extraction, data transformation, data management, data cataloging, and delivery of data for analysis on platforms such as data lakes and through the Cloud. Sometimes the delineation of responsibilities become fuzzy.

The Technology of Data

For organizations to succeed, the business and technology dynamic must work in tandem.Suer nicely elucidates the mindset and thinking that is required if companies hope to make their data initiatives successful.Suer notes, CIOs believe they should provide the infrastructure, the data stores, and the operations and support for data-centric IT. CIOs should be custodians of the data. CIOs believe a CDO's prime directives should include governance, citizen data science, cloud data management, DataOps, data quality, data security and data science.Given the complexity of capabilities and specialized expertise required to manage data, it should not be surprising that companies struggle to demarcate clear lines of ownership and responsibility.Suer concludes, CIOs want CDOs to have a broad mandate across organizations and functions to identify, gather and help place value on data.

Regardless of the lines of demarcation, and the division of responsibility between CDOs and CIOs, a few things are clear. A year ago, in a Forbes article, Why CIOs Have A Big Stake In Data Success, I wrote, Today, very few executives tell me that they view technology limitations as the principal barrier to becoming a data-driven organization. Rather, they describe ongoing challenges relating to organizational alignment, business collaboration, and common language and meaning.Not surprisingly, for the 4th consecutive year, over 90% of executives (91.9%) identified cultural factors as the greatest impediment to becoming data driven. Only 8.1% of executives pointed to limitations of technology.

Writing last year, I concluded, Although CIOs may no longer manage all aspects of corporate data programs, they will continue to have an enormous stake in the successful outcome of data transformation efforts.Suer echoes this sentiment, summarizing his perspective CIOs today have a big agenda in digitizing and integrating their companies. Having an expert data leader to take on the data agenda allows the CIO to become a critical change agent for digitalization. Appreciating the dynamic of managing both the business of data and the technology of data will be fundamental to realizing business success.

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The CDO/CIO Dynamic: The Business-Of-Data Meets The Technology-Of-Data - Forbes