Is the CDO Necessary for Digital Transformation or Just Another Ingredient in Alphabet Soup?

September 6, 2017 | Posted by Lisa Carolan

digital transformation.jpgDigital transformation offers many new opportunities for companies to expand their reach, engage with their customers and streamline their business processes. However, a digital transformation is not without challenges. Business goals must be interwoven with technologies that provide a seamless experience across a variety of channels. The demands of making a successful transformation to a digital enterprise have led many companies to add a chief digital officer to their C-suite. However, despite the increased hiring of CDOs, there are some who wonder whether the position is necessary. 

 

The Role of a CDO

Traditionally, marketing responsibilities included handling the company's limited online presence. This was often little more than a website, email campaigns, banner ads and landing pages, so most CMOs were comfortable juggling online and offline responsibilities. The

n came a surge of new digital technologies, including smartphones, social media, the Internet of Things, artificial intelligence and big data. At the same time, customers were feeling increasingly empowered and began demanding personalized experiences, relevant content and seamless integration across offline and online channels.

The variety of innovative technologies usually required the CMO to rely on the CIO for assistance in deploying a technology and using it effectively. The CMO understood the expectations and demands of the customer far better than the CIO, but the CIO usually understood the limitations and benefits of each new technology better than the CMO.

Enter the chief digital officer, the driving force behind an organization's digital strategy. A CDO is someone who combines elements of the CMO with elements of the CIO. CDOs possess digital acumen, but they also possess a keen understanding of how to please their customers. A CDO is active in the areas that drive revenue and interface with the customer — in short, the areas that determine whether the company meets its business goals. 

 

Where Does This Leave CIOs and CMOs?

The rise of the CDO has left many CIOs feeling uncomfortable, according to an article published by CIO.com. Many CDOs come from areas other than IT, including sales, marketing or business development. The position is often created by a CEO who is serious about achieving a true digital transformation. If the CEO does not believe that the CIO is committed to a digital transformation or lacks the ability to understand all aspects of the business, the CEO will likely hire a CDO — who will typically answer only to the CEO. 

The autonomy of a CDO who reports to the CEO could also leave the CMO feeling left out. After all, the primary role of the CMO is to gain an understanding of the company's customers and find engaging ways to connect with them. If the responsibility for digital is taken from the CMO, what duties are left? However, if the company has not yet created the CDO position, CMOs could launch a preemptive strike and hire their own CDO, incorporating the position inside the marketing department.

However, regardless of whether CIOs and CMOs feel slighted, companies undergoing a digital transformation need the skills that a CDO can provide. A CEO has enough on his or her plate without trying to understand the digital world. CDOs help CEOs pull together all of the organization's disparate pieces to help smooth the journey. After all, the ultimate goal is to achieve alignment between all departments as well as between the physical and digital worlds. Integrating people, things and business models can help companies find or remain on the path to success. Whether one, two or three C-level executives are needed to accomplish the company's goals matters less than having the right people in the right positions to ensure that the enterprise will thrive in the digital world. 

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Topics: Digital Transformation

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