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Chief Data Officers are a growing tribe, but higher strategic focus is required: Gartner survey

Only 8% of CDOs are directly measuring the financial value of Data Analytics; poor data literacy is the No. 1 roadblock to creating a data-driven culture and realizing the business benefits of data

Data is gaining more importance in the organisation and there have even been discussions on whether the value of data should be considered when doing the valuation of companies for M&A and IPOs. The role of the Chief Data Officer (CDO) is also gaining in importance. However, a survey by Gartner reveals that while CDOs and their Data Analytics (DA) teams are focusing on the right priorities, they are yet to achieve the best balance of their various responsibilities to deliver superior organisational performance.

The survey shows that 30% CDOs report to the CEO, 17% report to CIOs, and 15% report to the COO. Just 5% of CDOs report to the CTO and 4% to the CFO.

Chief Data Officer, Gartner
SOURCE: Gartner

Addressing the media at the Gartner Data & Analytics Summit in Mumbai (June 10), Debra Logan, VP & Gartner Fellow, Research & Advisory Services said, “In 2012 we managed to find a 100 odd CDOs by a conservative estimate. Today there are over 10,000 CDO profiles on Linkedin. We know that there are a lot more people who are managing data for an organisation. So it was becoming obvious that there is this unmanaged asset, data. About 40% of CDOs are in N. America and 60% outside the U.S. —  mainly in Europe and the Asia Pacific. We think there are 10% in India.”

Gartner’s fourth annual CDO survey was conducted online from September through December 2018, among 257 CDOs, chief analytics officers and other high-level data and analytics leaders from across the world. The survey found that while the creation of a data-driven culture was ranked the No. 1 critical factor to the DA team there were conflicting rankings for technical and non-technical activities (data integration and data skills training), and strategic and tactical activities (enterprise information management [EIM] program and architecting a DA platform.

While the implementation of a DA strategy was ranked the No. 3 most-critical success factor by 28% of CDOs, another strategic activity – creating a data literacy program – was ranked only 12th. This was despite the fact that, in the same survey, “poor data literacy” was ranked the No. 1 roadblock to creating a data driven culture and realizing the business benefits. Only 8% of CDOs are directly measuring the financial value of Data Analytics.

“A majority of CDOs are not measuring the effect of data on business KPIs. They are measuring data quality, which is important. But how does that affect customer churn? How does that affect product development?” said Logan.

She said CDOs should focus on business KPIs and show the relationship between data and business outcomes. CDOs should be talking to the head of sales, product development and heads of other business units — the people who are responsible for the business KPIs.

“CDOs are generally focused upon the right things, but they do not have the “right mix of activities,” said Logan. “The right mix of activities means how much are you focussed on new value helping businesses to get revenue? The other part is data governance and making sure that the data is correct so that you are drawing the conclusions on the right data.”

Logan said many CDOs come from the business than from the technical side (60:40).

“We have people from marketing, finance, and then others coming from a technical background. They work with the CIO to get the technology they need. They understand the business that they are in and that’s what makes them successful. They are mid-career people and you rarely get them younger than 30 years of age. They have a deep understanding of how the financial services industry works or how manufacturing works (strong domain expertise), she said.

Globally, Financial Services is No. 1 (24%) and Government is No. 2.

“There are lot of CDOs emerging in Government. Financial Services has always been the biggest consumer of IT. The ones that focus on data governance, which needs to be done, a lot of the push in financial services came from banking regulation, since the 2008 financial crisis,” added Logan.

Organisations have focussed on governance and risk since the financial crisis, but now the focus has shifted to services.

Chief Data Officer, Gartner
SOURCE: Gartner

“The low ranking of strategic activities can be explained because the majority of organisations are at maturity level 3 or higher for EIM (Enterprise Information Management) and business intelligence and analytics,” said Logan. “While the survey shows that information governance is important, especially MDM (Master Data Management), CDOs should never lose sight of the business outcomes they are trying to achieve. Focusing exclusively on governance, even MDM, is not enough to succeed as a CDO,” concluded Logan.


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Brian Pereira

Brian Pereira is an Indian journalist and editor based in Mumbai. He is Editor-in-Chief of Digital Creed, which he founded in 2015. A technology buff, former computer instructor, and software developer, Brian has 27 years of journalism experience (since 1994). He is sound and confident about his knowledge of business technology concepts. And he is a believer in continual education/learning. Brian is the former Editor of CHIP and InformationWeek magazines (India). He has written hundreds of technology articles for India's leading newspaper groups such as The Times of India and Indian Express Newspapers (among others). And he has conducted more than 300 industry interviews during his journalism career. Brian also writes on Aviation, cybersecurity, startups, and topics directed at small and medium businesses. He achieved certifications from the EC-Council (Certified Secure Computer User) and from IBM (Basics of Cloud Computing). Apart from those, he has successfully completed many courses on Content Marketing and Business Writing. Follow Brian on Twitter (@creed_digital) and LinkedIn.

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