Do You Need a Chief Data Officer?

The city of Philadelphia recently hired Mark Headd as their Chief Data Officer, and he’s not the first to hold such a title—it’s begun to crop up with greater frequency in companies large and small. Why should your organization have a Chief Data Officer, and how does that role differ from that of the CIO, CFO or CTO?

Headd is an interesting choice. He comes from Code for America and ran several open data projects in his career; moreover, he’s a big supporter of numerous civic hackathons and using technology to open up government data to the public.

He is “making sure agencies aren’t reinventing the wheel, running into the same problems,” Headd recently told the NewsWorks blog. “You get someone who can take a holistic view across city government and be strategic about the city’s use of data.”

“Over 60 percent of firms surveyed are actively working towards creating specialized data stewards, and eventually Chief Data Officers, for their enterprise,” according to a recent survey by GoldenSource Corporation cited in Information Management Magazine. Some organizations have begun identifying CDOs on their Websites, raising the profile of the position.

But Deepak Bhaskar, the Senior Data Governance Manager at Digital River, suggested in a recent presentation that simply plugging a “data guru” into an existing hierarchy isn’t necessarily an easy task: managing data across the entire enterprise can take on many dimensions (see chart above).

Consulting firm Cap Gemini (among others) believes that, in an ideal world, one person should be focused on the quality, management, governance and the availability of data. It is about treating data as a strategic asset. But most organizations don’t give data the same kind of attention as other corporate assets, Rich Cohen and Ara Gopal wrote in Analytics Magazine last year.

That’s somewhat ironic: as IT departments move towards Bring-Your-Own-Devices (BYOD) and cloud-based computing, they should focus more on their data. As one corporate IT manager from a large manufacturing firm said: “Nowadays we don’t own the devices, we don’t own the servers, we don’t own the networks that connect them, and we don’t own any of our apps that run on these devices. All that we have left to derive value from is our data.”

Why consider a CDO now? Several reasons.Enterprise data is no longer black and white,” suggest Cohen and Gopal—meaning that data can be found anywhere and everywhere.

In some cases, IT departments can’t even figure out where their data actually lives. Chris Wolf, an analyst at Gartner, spoke about one firm that he interviewed that made a recent upgrade of its Microsoft Office suite from 2003 to 2010 version. In the course of that upgrade, it lost support for an aging Access 2003 database used by dozens of employees for mission-critical data—and yet the IT department had no idea it existed. Whoops.

Just think about all your customer interactions today. You can have a collection of text messages, blog entries, social network posts, mobile applications, customer-generated videos, Tweets, emails, and even Instant Messages. How can you track all of this data? Ultimately, one person needs to be in charge and see the entire data landscape.

Another reason is that “recent regulatory reforms have placed an even higher emphasis on data accuracy and the risks associated with the lack of end-to-end visibility,” added Cohen and Gopal.

What is The Role of the CDO?

Brett Stupakevich, writing in a blog on Smart Data Collective, believes that CDOs should have three primary responsibilities:

  • Data stewardship, or being the chief owner of all enterprise data;
  • Data aggregation, or being responsible for “building bridges between business units and creating an enterprise focus for the data”;
  • Communicate data schemas and eliminate any semantic differences among enterprise data.

Cohen and Gopal added that the CDO should “develop capabilities to measure and predict risk and influence enterprise risk appetite at the executive table.” The CDO should also be watching the top-line revenue numbers as well as the bottom line.

“The one skill that helps me a lot in my current job is to interact well with people, so I lead my team efforts to better serve the business needs of my C-Level peers,” Brazilan CDO Mario Faria wrote on a LinkedIn forum. “Technical and business skills are necessary however not sufficient for this job.”

To Whom Should the CDO Report?

Cohen and Gopal asked a very good question: “Does the CIO report to the CEO or to the CFO; in other words, is the IT organization seen as an integral part of the corporate strategy or it is seen as a cost center that enables day-to-day business operations?”

But there’s a larger issue, namely, does the entire C-suite buy into the CDO as another peer? Depending on your own organization, a CIO with enough revenue authority—or a CFO with enough IT authority—might be called a CDO. But what matters it isn’t so much the title as the role’s actual responsibilities, as well as how much visibility into a corporation’s data footprint they actually have. Right?

Not so fast, according to many members of the CDO LinkedIn group who responded to this very question. “Each role (CIO and CDO) has its purpose and everything can not be under control thanks to a single function. And even more in big company,” wrote one poster.

It seems that CDO has yet to find its way to corporations involved in Big Data. Chief Scientist for Hilary Mason said: “I don’t know that many people with the specific title of Chief Data Officer. It seems like that would be a title found at larger corporations, but I like that it implies that whoever controls the data actually reports directly to the CEO.”