The rise and fall of the Chief Digital Officer

by Trenton Moss on 14 January 2019

Digital transformation started gathering momentum (before its more recent decline) in the early 2010s and the Chief Digital Officer (CDO) role started popping up across more and more businesses.

Digital is all about culture, processes and ways of working. And generally the purpose of the CDO - to 'do' digital transformation - is to get the business to emulate the culture, processes and ways of working of companies born in the digital age. No simple task.

Yet it does feel (albeit anecdotally) that the number of CDO roles out there is slowly declining.

Here are a few reasons why this might be happening.

1. No one really understands what you do

For a CDO, explaining what you actually do to busy senior colleagues who think you're there to run the website can be challenging. In reality, you're responsible for:

  • Redefining how your business delivers products and services to your customers
  • Improving business operations and modernising ways of working
  • Using technology and automation (where appropriate) to achieve amazing customer experiences

So the job title should probably be Chief Target Operating Model Officer (catchy, right?), but then...

  • Don't operating models traditionally fall under the remit of the COO?
  • Shouldn't the people in charge of both HR and facilities take ownership on the ways of working piece?
  • The CMO will for sure have something to say as what you're doing is going to impact comms to potential/existing customers (and the CMO is in charge of this)
  • Much of this is about using technology as an enabler so the CTO/CIO definitely has ownership over a lot of this

In any role, your chances of success are increased if you have clearly defined roles and responsibilities. This isn't the case at all for a CDO, so you're going to need lots of CEO-support to get things done!

 

No matter how much a CEO loves your vision for a digital future, getting the CEO to sign-off budget is much harder.

2. You're often ignored & can't secure budget

CEOs tend to be super-enthusiastic when appointing CDOs for the first time ("We need to be digital! We need to be disruptive! We need to be the Uber of our industry!") but when the silver bullet of overnight change doesn't materialise, the focus tends to go back to day-to-day fire-fighting and business-as-usual.

Competing for budget is no new thing, but for a CDO - in charge of transitioning to a future operating model - it's particularly tough when:

  • The CIO says that £50m is needed to stop your core IT from failing and that without this money the business will cease to operate
  • The business has traditionally spent £millions on TV advertising and the CMO keeps scaring the CEO/CFO with horror stories of what would happen if this changes
  • The COO is being targeted with cost cutting activities directly at odds with what the CDO is trying to do

(These are all real life scenarios I've heard from CDOs.)

No matter how much a CEO loves your vision for a digital future, getting the CEO to sign-off budget and instruct other C-suite execs to play ball (when doing so doesn't support them hitting their targets) is much harder.

The term ‘digital’ will likely die out over the next few years as ‘digital’ operating models basically just become the business operating model.

3. It's a temporary role anyway

The term 'digital' will likely die out over the next few years as 'digital' operating models basically just become the business operating model. And once this happens the Chief Digital Officer (who's really the Chief Target Operating Model Officer, remember) won't have much to do. Modern companies born in the digital era don't have anyone 'owning' digital after all.

If you're doing a role where you need to drive change into a business, then that role no longer exists once you've succeeded. So what will all our Chief Digital Officers end up doing? Gradually, CDOs seem to be moving to roles such as:

  • Chief Product Officer (CPO) - Once an evolved operating model is up and running (typically with product-focused teams) then someone needs to run this
  • Chief Experience Officer (CXO) - You're responsible for all customer touchpoints, typically covering marketing through to product/retention
  • CEO in a different company - Your role as CDO touches far more areas of the business than with other C-suite roles so equips you well to sit in the hot seat
  • And occasionally... a CDO at another company, hoping that driving through change will be a bit easier than the last job (it often isn't)

4. It's a bit embarrassing to still be recruiting a CDO

So a Chief Digital Officer role is a temporary one, driving through change so that the business takes on the culture, processes and ways of working of the companies born in the digital age. And once the change has happened - or at least the business is heading in the right direction - you may no longer need the role.

To be recruiting a CDO in 2019 is almost an admission to the world that:

  • Your business is so far behind the curve that you're not even heading in the right direction
  • Senior management still don't get what's needed to survive and thrive long-term in our digital world

Rather than recruit a CDO, your business may be better off educating senior managers as to digital operating models and ways of working. (We can help with this.)

Are you a CDO?

If you're a Chief Digital Officer then hang on in there! More and more businesses do seem to be making progress and it feels like there's more momentum than ever to make change happen.

Oh, and do come along to our CDO roundtables which we run every 1-2 months - you'll get to share challenges and discuss potential solutions with a bunch of other CDOs and Digital Directors.

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