The rise of the chief digital officer

With digital on the rise, more and more companies are appointing chief digital officers. agendaNi looks at how the role is evolving.

The challenges and opportunities in the digital age are enormous no matter what sector you are in. Many organisations are looking to move more of their processes into the digital space, ranging from back office operations to customer engagement channels that are migrating increasingly online. As companies forged strategies to focus their digital efforts, the word digital started creeping into people’s job titles. 2015 saw the advent of the chief digital officer, trumpeting the arrival of digital in the board room.

Some companies in the technology sectors don’t have a CDO. Google and Facebook don’t need a CDO as they are already digital. On the contrary, it has been argued that appointing a CDO is crucial for the implementation of any digital strategy. Without any change to existing structures any strategy will be ignored. As with any change programme having a board room champion will only help its successful implementation.

So what’s different about the chief digital officer role? Firstly, it goes beyond the remit of technology. Digital strategies go beyond the technology aspects that fall under the remit of the IT function to encompass many business process, particularly those that extend beyond the boundaries of the organisation. Many see the role as a ‘business’ role rather than solely an IT role. In many organisation it is closer to the marketing function and the technology function.

However, there is a potential for conflict. Many of the new digital tools are in the realm of IT professionals. There is a risk that the newly appointed CDO will look to invest in a raft of digital tools. These need to be compatible with the organisation’s IT infrastructure.
Some see the CDO as a transformational job, a catalyst, with a limited shelf-life as digital becomes more mainstream. Marketing is increasingly becoming enmeshed with technology. Accenture points out that by 2017 the marketing department is projected to spend more money on information technology and analytics than the CIO. Technology analysts Gartner have gone further and said that, because of the digitisation of businesses, the servicing of clients and the creation of new digital revenue streams, means that every budget is becoming an IT budget. Gartner has predicted that 25 per cent of businesses will have a CDO by the end of this year.

The Chief Digital Officer needs to be familiar with web, mobile and social media. They must also be technically literate. They need not only to have a good handle on the technology but also be a seasoned general manager, particularly if they are going to survive at board level. As the role develops it will be interesting to see if the job title is seen as a passing fad or something that will become fundamental to running an organisation into the future.