Chief Digital Officer – To have or not to have

April 30, 2018
3 mins

Digital transformation is real, today, and here to stay; there is no debate about that. However, organizations across industries vary significantly in the transformation process they adopt. Of the few common practices, the one that’s highly debated is the position of a Chief Digital Officer. The argument is that if Digital is the only way forward, shouldn’t that be the KRA of CEO or COO? Why do we need another C level position for that?

So, do we need a CDO?

Today, companies are trying to deal with huge amounts of data, lots of tech advances, and disruptive business models in a highly competitive environment, and the thought cloud has just about burst! Neither the CEO nor the COO is equipped to deal with all these elements. However, a skilled CTO(Chief Digital Transformation officer) / CDO (Chief Digital Officer) with great leadership skills can be that maestro conductor inspiring an amazing orchestra.

Innovation Strategy Playbook

Enable digital transformation the right way

We have companies such as Disney, Amazon, L’Oréal, GE, Harvard University, McDonald’s, The Guardian, and Renault who have chief digital officers (CDO) to effect digital transformation. That’s some serious validation there. For example, Patrick Hoffstetter joined Renault in 2010 to direct its digital strategy and ops; as head of the digital factory, he got Renault (Dacia & RSM) to make car apps after partnering with Apple and Google, transformed the sales experience by providing PC tablets that had product and customer information to garages and dealerships, launched an enterprise social network for employees, and acquired millions of followers on social media with a mobile marketing initiative. And these were only some of his achievements as the CDO.

The authors of a September 2017 post on Reddal describe a 3C framework to explain why you need a CTO/CDO:

  • “Continuity” in large-scale transformations
  • “Consistency” in aligning all operating model elements to the target state
  • “Control” of the journey by implementing proactive risk management, deciding on interventions,   and engaging in people management

I think this makes a lot of sense.

The necessity for a Chief Digital Officer

Source: Deloitte

Not a foolproof approach to deal with omnipresent digitization unless…

The role has been around in several large enterprises for the last decade. Despite success stories, there have been some unfortunate instances as well. Why has it sometimes failed?

Reasons why the Chief Digital Officer role fails

Source: Arthur D Little

So what is the right recipe then..

With the right scorecard, budget, and a clear digital roadmap, the CTO/CDO, who needs to be smart and charismatic, can make change happen—spreading the vision, empowering employees, breaking down silos, implementing high-growth projects, optimizing processes, building networks, and creating an agile environment. This role needs the support of the top management and the front-line staff to drive the digital agenda.

With guidance from the board and the CEO, he or she can make a decisive shift around the digital strategy and innovation. The CTO/CDO can connect strategy and implementation better than anyone else. And the companies who are invested in it, realize that this is for the long haul because it is just not some strategy on paper but requires active involvement from people across the board. Only then does it ensure the blooming of the right culture, which encourages tech advancement faster than ever.

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About the Author

Dhanya Menon
Dhanya Menon is an editor and academic writer. This is her first stint in content marketing, having spent over 5 years in e-learning. Her interests are varied. She likes to lose track of time reading anything from chemistry to Allende, from statistics to Thurber cartoons, from Ruth Rendell to listening to her son's unique take on life.

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