I just got back from the Chief Data Officer Summit in NYC. I’ve been exploring the evolution of the Chief Information Officer role within large enterprises, which led me to this immersive event and a further understanding of the many ways business are adapting to the massive change reshaping their enterprise IT departments. (It was also great to hear the validation of analytics best practices we’ve been following at Sonian on our own data sciences journey.)
1. The Chief Information Officer (CIO) is morphing into the Chief Data Officer (CDO)
Clearly, over the past 10 years, the traditional CIO role has been changing (some might say it’s under assault) as line of business managers went around IT and purchased their own IT, often in the form of SaaS, such as salesforce.com or Zendesk.
The CIO and CDO will jointly own the comprehensive data strategy. But as analytics becomes more important, the CDO will assume more responsibility and ultimately assert more control.
A simple but effective way to see this change is to analyze the Google search results for “CDO” and “CIO.” Searches for CDO are growing 100% CAGR, while people seeking CIO information is declining by significant percentages. Searches across open job aggregation sites reveal an increase in “Chief Data Officer” open positions, while CIOs are flat or declining.
For a CDO to be successful, they will need to empower the “citizen” analyst within their organizations to help business users consume, prepare and analyze the data available in all the systems of record. This is new thinking for the IT department and perhaps “legacy-minded” CIOs will not be able to make the transition to this new “analytical” world.
2. CDOs have significant challenges but big opportunities
The CDO opportunity is to deliver exponential IT value to their business leader counterparts. The CDO challenge is to help their technical colleagues realize that IT needs to understand the business context. IT as a standalone, existing in a vacuum of supporting file and print servers, isn’t where value is created these days.
“There’s gold in them thar hills!” is a famous call to action of a prior gold rush. Today’s equivalent is to find the “tons of treasure and pile of gold” in enterprise data “while slaying the dragons protecting the stockpile.” The dragons are legacy-thinking, outdated integration technology and IT staff with poor training in analytics.
CIOs and CDOs have overlapping responsibilities and share a need to provide innovation in the form of analytics. But the most important requirement for data sciences is to know the business context. In this case, the CDO is better positioned to connect business needs to IT capabilities and to understand the value proposition chain of their respective organizations. The value chain is the virtuous cycle that weaves together what the company sells with why customers buy it.
3. Organizing enterprise data for analytics is difficult
On average, today companies use only 12% of their data to get insights. The CDO opportunity is to go from a measly 12% to a much higher number. When more data can be harnessed, more insights can be gleaned. But a hurdle is that most of an enterprise’s valuable data is in an unstructured format. Some estimate that as much as 80% is in this hard-to-process format.
Fortunately, cloud computing, open-source technologies and newly-trained data scientists make it possible to mine the data buried deep inside databases, email, files and communications.
As CDOs plan their analytics projects, they need to focus on “quick wins” while tracking toward a long term vision. “The pursuit of perfection shouldn’t interfere with the art of the possible.” These days, IT needs to demonstrate business impact more quickly than in the past.
IT of 2015 and beyond needs to transition into enforcing the “guardrails” of compliance, information governance and security, while ensuring vendors meet their committed service level agreements. The transition of the CIO to the CDO is part of this change.
— Greg Arnette is the founder and CTO of Sonian. Follow Greg on Twitter for more information about email, collaboration, big data management, cloud computing, start-ups and more.
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