The Modern CDO Role Extends Beyond Data
- By Sheila Lam
- October 13, 2022
While data is the foundation for innovation, it can also be highly complex. Companies need to overcome the challenges of massive volumes, diverse formats, and different processing platforms to drive innovation with data.
An increasingly complex data landscape also restricts the use of data, limits the shareability for analysis, and depreciates the value of data rapidly. Google’s latest study found that 68% of companies were unable to realize tangible and measurable value from data.
Is the CDO the solution?
“Closing the data value gap is often a technical challenge, but it is also an organizational issue,” said William Tsoi, customer engineer and data analytics specialist at Google Cloud.
Tsoi explained that organizations often handle these problems by hiring a chief data officer (CDO). A NewVantage Partners study pointed to the 74% of companies that appointed chief data or analytics officers in 2022, as compared to only 12% in 2012, shows that companies are beginning to appreciate the CDO’s role.
However, employing a CDO does not miraculously solve a company’s data problem. Tsoi explained that only half of the CDOs in the Google study felt that they could drive innovation using data.
74% of companies have appointed chief data or analytics officers in 2022 as compared to only 12% in 2012
“As a CDO, you need to know that you’re an equal partner in driving the business forward, not just a hired gun that’s been brought in for your technical expertise,” said Tsoi, quoting Grace Lee, senior vice president and chief data and analytics officer at Scotiabank.
“Data and analytics isn’t a side project. Until we [as CDOs] understand that the entire business runs on data, we are going to be consistently challenged with and limited by the project-based mindset around the CDO role,” she continued.
This project-based mindset, according to Google Cloud’s Tsoi, creates organizational and data silos. He explained that working with data was a multi-disciplinary affair that required cross-functional collaboration. You will need IT infrastructure experts, data engineering experts, and business domain experts to constantly work together and identify innovation strategies, while prioritizing investment for data exploration.
Not all silos are made equal
When CDOs get involved in the execution of a project, instead of strategic planning, it becomes difficult to use the project fund to build an analytics platform capability. It inhibits organization-wide data innovation and exploration.
“Enabling data exploration requires investment in the ingestion and modeling of data, which requires a leap of faith,” said Tsoi.
He explained that data is generated by multiple applications that different business units own. Data modeling — which aims to consolidate data into a single repository and explore its potential for analysis — is not typically part of the development process for digital services. Instead, data is a by-product of digital services instead.
However, this data is critical for identifying future innovation opportunities. Tsoi pointed out that the ROI for the data depends on the organization’s ability to collaborate and create a data-driven culture.
“The more business units that are involved in the analysis and sharing of data, the more opportunities and value an organization can derive from data exploration,” he added.
Carrefour: Shopping for data culture
There are clear examples from around the world that demonstrate the value in breaking data silos and powering data consolidation with a data-driven culture.
One example is French retailer and groceries stores operator Carrefour. It saw value in nurturing a data-driven culture and so partnered with Google to create the Carrefour-Google Lab.
Google supported Carrefour with technologies for building a common data platform and common code repository. More importantly, it helped Carrefour create a data and AI community by promoting a data culture across the organization.
By gathering data internally with insights from Google Ads, Carrefour is developing more targeted advertising and increasing its return on advertising spend by 300% to 500%
Through this lab, Carrefour identified 70 qualified AI use cases across different business units. The units included product assortment, pricing and promotion, supply chain, store operations, marketing, and e-commerce. Eight of these cases are now in production.
Google Cloud’s Tsoi said that one use case empowered Carrefour to calculate and predict the lifetime value of customers by consolidating and analyzing financial transactional data, product data from the supply chain, customer behavioral data at the store, and CRM data. When combined with insights from Google Ads, the data helped Carrefour develop more targeted advertising and increase its return on advertising spend by 300% to 500%.
Hyper-personalization at HKT
In Hong Kong, HKT also drove a data-driven culture by partnering with Google. The collaboration allowed HKT’s loyalty program and digital ventures arm, The Club, to create a hyper-personalization platform named Copernicus by integrating its digital ecosystem with HKT’s different business pillars.
According to HKT, Copernicus helped The Club understand each member’s purchasing behavior and interests more precisely and quickly using a single unified platform. The Club is currently using this platform as the foundation for more targeted marketing strategies across multiple touchpoints and more personalization for its members.
All these examples indicate that driving value and innovation from data is not only a CDO’s job. It is a collective effort that includes the IT infrastructure team, data engineering team, data science team, all business domains, and external technology partners.
Besides offering technical advice on the data platform and engineering, the CDO also has to understand the business and drive collaboration across different stakeholders to build a data-driven ecosystem.
“You [as a CDO] have to choose where to start, and people always say start small and get some runs on the board. You need these runs to initiate and drive culture change to get everyone to buy in,” Google Cloud’s Tsoi concluded.
Sheila Lam is the contributing editor of CDOTrends. Covering IT for 20 years as a journalist, she has witnessed the emergence, hype, and maturity of different technologies but is always excited about what's next. You can reach her at [email protected].
Image credit: iStockphoto/gorodenkoff