Chief digital officers (CDOs) deal with disruption daily. So, it would be hubris for them to assume that their own roles will not meet the same fate of legacy systems.
Some see their current roles as short tenures. Get into the business, effect the necessary transformation, move onto the next role, and have the same impact.
One argument is that once digitization becomes ingrained in the organization, having a C suite executive responsible specifically for this area becomes redundant.
With the rise of the CDO, some degree of corporate backlash was inevitable. After all, change can be painful. It can bring down longstanding empires within the organization.
CDOs need to understand that they are not there to win popularity contests. They are there as change agents. Meanwhile, the majority of people in the organization want stability and to hang on to their jobs.
The Proactive CIOs
At a top leadership level, there is also the question of the organization’s appetite for the kind of change CDOs can bring.
Forrester’s prediction that 2018 would see the demise of the CDO was well publicized. But like most predictions of its kind, it's an impossible one to measure. Other analyst firms see the role peaking by 2020 but petering out by 2025. They see digital becoming a smaller part of the organization, like an innovation lab.
The point of the Forrester prediction is more worthy of analysis. Ultimately, the chief information officer (CIO) is the one who will need to step up. He or she needs to reclaim many of the CDO's transformational responsibilities.
So what does this mean for people in CDO roles? Do they transition back into CIOs, find organizations which still believe in the CDO mission, or do they go and found their own companies as CEOs of start-ups?
Abstract Thinking Unwelcomed
I recently spent some time with the chief executive officer (CEO) of a large Australian IT outsourcing company. He had some very definite views on this subject. He asked for anonymity but here’s some of what he had to say, directly from the transcript.
“The CDO role should properly be part of the remit of the CIO,” he said.
“Businesses which recognize that and restore those responsibilities to the CIO are ones which will be better placed to effect more effective transformations.”
Many of the people appointed to these CDO roles are non-traditional IT people, he said.
They tend to be abstract thinkers who are future-oriented and well researched on trends. They know about blockchain before everyone else. They also know which technology platforms are coming over the horizon.
“The reality, however, is that it is very risky hiring someone with this profile to drive what is the most uncertain part of the business,” the CEO said.
“Many of the strategic ideas which come from the CDO tend not to be taken seriously by the CEO and the board. They end up withering on the vine due to the corporate inertia struggle. The CDO is often a smart person with very creative ideas, but in many large organizations, there is a weight of history and corporate baggage, which can squash some of the best ideas.”
Will CDOs Fade Away?
Over time, the CEO said, the most favorable outcome will be for the CDO role to fade into the background and for the CIO role to be correctly redefined. It is because the CIO is the one who should be entrusted with driving digital change.
“Right now, many organizations are creating CDO roles and telling the CIO to just worry about the laptops, networks and making sure the security it up to scratch,” he said.
"That creates big gaps in the business and the executive team between those who are thinking about digital transformation and those who are keeping things ticking day-to-day, and that includes fixing the laptops.”
Businesses which do this are running the risk of making IT non-strategic. Exiling IT from the strategy is likely to create significant future challenges as the organization struggles to transform and adapt.
A better approach, he said, is for the CIO role to step up, to stop reporting to the CFO and go direct to the CEO and the Board.
All this puts CDOs in a dilemma as their roles transform as fast as the business itself.
Time to Fight Back
My own feeling, after covering this area for many years and talking to many digital leaders is that CDOs need to fight for their rights and get themselves in front of the board. And tell the CIO to focus on fixing laptops.
The idea that digitization is a finite project is, in my view, nonsense. Today, change is permanent, and any business which stops changing is heading for extinction.
So, the skills and the perspective that the CDO brings is permanent and necessary, no matter what you call the role.