CDOs’ biggest problem? Getting colleagues to understand their role

Chief data officers have a lot to think about these days. Chief among them, they must ensure responsible, compliant use of their organizations’ data in the face of increasingly complex regulatory environments across the globe.

Now, CDOs find themselves under additional pressure to make sure organizational data is accurate and complete, as companies launch AI projects hungry for clean and easy-to-access data.

On top of all that, CDOs may be undergoing a bit of an identity crisis. It seems that many coworkers don’t understand what they do. In the alphabet soup of traditional and new C-suite jobs — CAIO, CXO, CHRO, CTIO, CPO, and several others among them — about three-quarters of CDOs believe their jobs are less understood than other C-level jobs within their organizations.

That’s according to a recent report based on a survey of CDOs by AWS in conjunction with the Chief Data Officer and Information Quality (CDOIQ) Symposium. One reason the role may be misunderstood, the report says, is because it’s relatively new. The CDO position first gained momentum around 2008, to ensure data quality and transparency to comply with regulations following the housing credit crisis of that era.

The CDO role also lacks a standard list of responsibilities, potentially adding to the confusion, note the report’s authors Thomas H. Davenport, Randy Bean, and Richard Wang. One possible definition of the CDO is the organization’s leader responsible for data governance and use, including data analysis, mining, and processing. In many cases, CDOs focus on business objectives, but in other cases, they have equal business and technology remits, according to the authors.

The survey responses aren’t a surprise to Jack Berkowitz, CDO of Securiti.AI, a data management and security firm. In many organizations, data has resided in silos, with internal teams such as sales and HR each claiming ownership of the data they work with, and customer data often considered separate from other internal data, he says.

“At the end of the day, it’s all the company’s data or the consumer’s data,” he adds.

Those dreaded silos

Part of the CDO’s job is to break down silos and change the practice of data hoarding in individual company units, Berkowitz says. “This notion of data in combination as opposed to a silo is something different for companies,” he adds. “This notion that the data is within their power to mine it for business advantage is different. It’s a new way of thinking.”

Many organizations are just beginning to embrace the concept of data as a huge business asset, adds Chetna Mahajan, chief digital and information officer at Amplitude, a data analytics firm.

“There’s more and more focus on being data-driven,” says Mahajan, who leads the Amplitude data strategy efforts, in addition to her digital and technology roles. “It really drives sustainability and is a growth engine that helps develop a competitive advantage.”

Until organizations realize the value of their data, the CDO role will be misunderstood, she adds. CDOs may not be valued until the “realization that the data is, if not as important, actually even more important than the technology, because data is where the company decisions are made,” she says.

Company data can drive its go-to-market strategy, she adds. With the right data, a company can tell if it is marketing its products to the right segment of the market, she says. For example, one company she’s worked with had targeted its product to the SMB market, but after examining its data, it realized that the large enterprise market was its future.

AI eats data for breakfast

Mahajan notes that, today, ensuring data quality — and adequate volume — has become paramount, as more organizations experiment or launch AI projects. Part of the challenge is to capture the right amount of data needed to train large language models for specialized tasks at each organization, she says.

When internal AI tools struggle with accuracy, it’s often because they don’t have enough data, Mahajan says. “Companies definitely need a playbook to be ready for the AI explosion,” she adds.

A recent Gartner survey of CDOs and people in similar roles found that 61% of organizations are rethinking their data strategies because of the disruptive force that is AI. Gartner called on CDOs, chief analytics officers, and chief data and analytics officers to work on expanding their influence within their organizations or face the prospect of being assimilated into internal technology teams.

Part of expanding influence is helping coworkers and executives to understand the role. Some of the misunderstanding about CDOs may come from the multiple reporting structures that the CDO position can fall into. In some cases, the CDO reports to the CEO, and in other cases, reports to the CIO, chief product offer, or to the chief legal officer, Berkowitz says.

In addition, the scope and responsibilities of the role vary widely across companies, says Todd James, chief data and technology officer for 84.51°, a retail data science, insights, and media company.

“The role runs the gamut from being a very traditional IT-focused role that is oriented to the management of data, to one that resides in the business and is focused on the application of data to create value,” he says. “I anticipate that we will see the role solidify over the coming years, with a bias to value creation.”

CDOs at some organizations may even be considered transitional roles to help navigate a “once-in-a-lifetime” restructuring focused on data management, he adds. After the transition, the CDO may be absorbed into the AI side of the company, and the strategic parts of the role may be moved to data-capable business leaders, he suggests.

Another source of confusion is because an organization’s data strategy leader may not be called a CDO. The data leader is sometimes called the chief data and analytics officer or simply chief analytics officer, and there can be overlap or the merger of the role with the chief AI officer, the CTO, the CIO, or other positions. The CDO tends to become a separate role when companies hit about a $1 billion in annual sales, Mahajan says.

Technology is not data

While CIOs and CDOs should work closely together, CIOs are typically more focused on technology, while CDOs are focused on data strategies, Mahajan says. “A lot of times, companies think they’re data-driven, but they’re not,” she says. “The focus has mostly been around technology and digital transformation.”

In the early history of the position, CDOs often were part of the legal department and focused on avoiding fines for the misuse of customer data, she notes. Many early CDOs appeared in the finance industry as lenders faced fines related to the 2007-08 housing credit crisis.

But the position has evolved in recent years in recognition of the value of company data and the importance of its accuracy and availability, Berkowitz adds. Still, with some data, like consumer information, needing special treatment, CDOs must have close relationships with chief privacy officers, CTOs, and CISOs, he says.

Berkowitz sees part of the job as bringing together significantly different cultures that can develop between technology teams and business teams. CDOs need to think of themselves both as business leaders and as technology leaders, he says.

 “Companies’ data needs to be protected, and companies need to be able to take advantage of the data that they have,” he says. “Those bridges need to be built.”