The rise and fall of the Chief Digital Officer?

by John Reiners

I was interested by an FT article (paywall) by Andrew Hill earlier this week on the changing role of the Chief Digital Officer (CDO). He quotes a CIO survey from recruitment firm Harvey Nash, showing that the number of CDO’s has almost doubled in a year – with 20% of CIOs now working with a CDO. Yet after discussing with a number of CDOs, he concludes that the role may become redundant.

The reason is that Digital is increasingly becoming just part of doing business, as I discussed in an earlier blog on the digital economy. Digital skills now feature strongly in job descriptions across the C-suite. So for the CMO, optimising online channels, online advertising, the digital customer experience and mining insights from customer data are often central to the job, requiring skills in big data, analysis and digital strategy more than the verbal and persuasive skills traditionally associated with the CMO. COO’s are adapting to a world of automated factories and managing a stream of information generated from connected, intelligent devices (the IOT). CIO’s are managing the transition from legacy enterprise systems to the latest digital capabilities (e.g. mobile apps). The CFO’s role is changing too, as the demand and supply of performance information shifts in a digital age. For the CEO, strategies and major initiatives increasingly need to be based on an appreciation of digital opportunities and threats.

The job description of the CDO is for a time when other members of the C-suite do not have these responsibilities and need specialist expertise to introduce digital initiatives, across the enterprise. CDO’s often report to but sit apart from the CIO, who remains responsible for business as usual. The CDO, typically working with a small team of data scientists, software engineers etc., works on transformation initiatives. As that migration completes to a more digital way of doing business, CDOs may ultimately make their own role obsolete. As one of the CDOs quoted in the article comments, “Who goes to Amazon and asks who their Chief Digital Officer is?”

My view though is that the CDO role will be around for quite some time. It will be several years before the C suite builds the skills needed to manage business as usual in the digital age. Besides, most businesses and public sector organizations have many years of transformation ahead of them.

John Reiners is Oxford Economics’ Managing Editor, EMEA. He manages research programs on a wide range of topics, including the digital economy and international trade. He also follows emerging trends, like the changing C-Suite. He can be contacted at jreiners@oxfordeconomics.com