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What is a chief data officer? A leader who creates value from all things data

What is a chief data officer? A leader who creates value from all things data

A chief data officer oversees a range of data-related functions to ensure your organization is getting the most from what could be its most valuable asset.

Of the new crop of tech-related CXO titles, chief data officer seems likeliest to stick. In most organizations that have one, the chief data officer oversees a range of data-related functions that may include data management, ensuring data quality and creating data strategy. He or she may also be responsible for data analytics and business intelligence, the process of drawing valuable insights from data. Or some data management functions may fall to IT, and analytics may belong to a chief analytics officer, a title that some say is interchangeable with chief data officer.

Whatever their responsibilities, in a recent report on the new title, Gartner called it a “strategic planning assumption” that 90 percent of large organizations will have a chief data officer by 2019. It’s easy to see why. Not only do many companies fear (or have suffered) a negative data event such as a breach, most are struggling with the fundamental dilemma that data presents.

“Imagine I’m a traditional CIO and one of the things I manage is fixed-cost allocation,” says Anthony Scriffignano, chief data scientist at Dun & Bradstreet. “And someone says we have to capture all of this stream of data and never throw it away because it’s so valuable. You’ve just made my head explode.”

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Old methods of capturing all the data available and then doing analysis to tease out value don’t work in today’s world, he says. “Some data, we just need to bring it in and store it. Other data, we need to know where it lives and how it’s changing. Other data, we just need to keep it for a short time.”

The chief data officer role and responsibilities

Most chief data officers have (or are building) a department or team separate from IT. In a Gartner survey last year of chief data officers, chief analytics officers, and others with similar titles, most reported leading their own dedicated group, usually a lot smaller than IT. Their budgets on average were 21 percent of their organization’s IT budget. Budgets and head counts can grow significantly, though, once a chief data officer has proved the function’s value.

Although some CIOs and CTOs see creation of a chief data officer as encroachment on their turf, most are grateful to hand off the data dilemma to someone else, says Andrew White, research vice president and distinguished analyst at Gartner. “The majority of CIOs and CTOs said, ‘We don’t have the time to focus on the structure of data,’” he says. “So the chief data officer role became legitimized.”

Two-thirds or more of the data executives in the Gartner survey said their responsibilities included such items as data quality, data governance, and master data management, but also information strategy, data science, and business analytics. But to truly focus on adding value, chief data officers shouldn’t spread themselves too thin. “Chief data officers who say they’re adding value to their businesses don’t have responsibility for managing data. That stays firmly with the technologists,” White says. “They tend to focus on strategy and prioritization and business cases. They act on behalf of other business leads.”

On the other hand, he says, “Some chief data officers manage the data as well and they tell us they’re not making much progress because they get dragged into the technology conversation.”

Chief data officer vs. chief analytics officer

Even though chief data officer and chief analytics officer are two distinct roles, they should both reside in the same person, argues Guy Gomis, partner at the recruiting company BrainWorks.

“I’m finding the best in class are combining the two,” he says. “Most leaders in analytics want to own the data strategy and how the company treats data and they want to own analytics.” It makes sense if you think about it. Analytics is how data provides value, so that’s an essential function. At the same time, you need a good data strategy and good data management or you won’t get quality data to analyze. Thus, Gomis says, “Best practice is having a chief data strategy and analytics officer who owns both data and analytics and works closely with the CIO.”

To whom should the chief data officer report?

Gomis believes the chief data officer should report to the CEO or COO, and be on a par with the CIO and CMO. But, according to the Gartner survey, that’s not how it is at most companies. Only 40 percent of respondents said they reported to the CEO or COO. Sixteen percent reported to the CIO, 11 percent reported to a senior vice president or VP outside the C-suite. Five percent report to the CFO, and another 5 percent report to the CTO, with the rest spread among various tech titles.

Scriffignano, who himself reports to Dun & Bradstreet’s CEO, says there’s no single answer to the question of where a chief data officer should report. “I’ve seen the role in finance, IT, marketing, R&D, it could even be product development,” he says. “Often it’s a new role, perhaps created by a person who was overwhelmed with the demands of their own role, so you’ll often find it in that part of the organization because that’s who created it. But that doesn’t necessarily mean that’s where it should stay.”

What to look for in a chief data officer

What kind of background makes an effective chief data officer? “Right now, 70 percent are math people and 30 percent grew up in engineering,” says Mike Doonan, partner at the high-tech recruiting firm SPMB in San Francisco. “I think that’s going to turn into 70 percent engineering because, in general, the math people are often experimenting. They’re almost scientists trying to prove a point with data, versus creating an infrastructure to use data properly and help the business make decisions.”

Gomis says he’s also seen chief data officers come from marketing backgrounds, and that some are MBAs who have never worked in data analytics before. “Most of them have failed, but the companies that hired them felt that the influencer skill set was more important than the data analytics skill set.”

Good people skills certainly could be useful for getting out of the bind many new chief data officers find themselves in. “One of the biggest mistakes is not understanding what it will take to succeed, in terms of expectations,” Gomis says. “If you look at a lot of the people who have had the title of chief data officers and chief analytics officer over the last three years, there’s a tremendous amount of turnover.” When you talk to them and their former employers, “It turns out that the expectation of the company and the candidates were not aligned,” he adds.

Often, the problem is unrealistic expectations from an employer. “The biggest mistake companies make is to expect that because they’ve hired someone the problem is solved,” says Justin Cerilli, who heads the data and analytics practice for consultancy Russell Reynolds Associates. “Actually, you’re just starting to solve the problem — the tough decisions are still to come. That’s when you start asking who our people are, what our processes are, and how do we change our culture. CEOs tell chief data officers to change everything to get the end results they want, but don’t want to change the way they do anything.”

Chief data officer salary

According to compensation analysis from PayScale, the median chief data officer salary is $184,335 per year, with total pay, including bonuses and profit share, ranging from $122,818 to $304,834 annually.

Chief data officer jobs

A recent search for chief data officer jobs on Indeed.com and LinkedIn showed positions available in a range of industries, including retail, media, financial services, higher education and government.

A sampling of chief data officer job descriptions shows key area of responsibilities such as: evangelizing and communicating a data vision a critical part of growth strategy; creating strategic data access policies; developing and executing a central data strategy to drive revenue; overseeing data governance, data investment and partnerships; and strategizing with C-level colleagues.

Companies are looking for, for example, highly motivated, experienced innovators who have produced tangible results, as well as senior-level leadership over data and/or analytics departments for seven or more years.

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