New kid on the block
As rapidly evolving digital technologies continue to alter the business landscape, a new and important executive is moving into the C-suite neighbourhood: the Chief Digital Officer (CDO). In 2015, it really is all about digital. Whether it’s personal banking, shopping, everyday workplace functions or complex business transactions, digital technology is profoundly reshaping the way we live and do business. Here are just a few stats that show how all-encompassing digital is becoming:
100 billion connected devices expected by 2025, leading towards a trillion sensor ecosystem1Peter Diamandis' “The World in 2025: 8 Predictions for the Next 10 Years”
In the last two years, we’ve seen 9 times more data created than in the entire history of humanity2Salim Ismail's “Exponential organizations: Why new organizations are ten times better, faster, and cheaper than yours (and what to do about it)”
1 billion digital natives will join the workforce in the next 7 years3Peter Diamandis' “Abundance: The Future Is Better Than You Think”
The rising tide of the CDO
From a workplace perspective, the rising number of millennials and digital natives will have its innate benefits as well as challenges. To thrive in this constantly evolving digital world, it’s crucial to attract and retain that top digital talent – but it can be a struggle to adapt an old-school office environment to fit the needs of these digital superstars, whose ideal work environment may differ somewhat from a “traditional” workplace. Navigating these waters can be tricky but it is essential to surviving in the new digital economy.
In light of all these massive changes, it’s no surprise the role of CDO – the executive in charge of all things digital – is becoming increasingly common and increasingly vital for many major organizations. That said, while the CDO role is becoming more commonplace, it hasn’t become so pervasive that it’s fully considered “part of the club” – yet. We see this shift to be imminent, however.
Digital strategy IS corporate strategy
As the seismic shift toward a more digital world continues to take hold, a company’s digital strategy and its overall corporate strategy are quickly becoming one and the same. Digital technology is no longer just another tool in the marketing toolbox; it’s becoming the foundation for entirely new ways of doing business – and for the creation of entirely new types of businesses.
2000 – Director, eCommerce
2008 – Director, Digital
2015 – Chief Digital Officer
2020 – No more CDO
The CDO’s superpower
Because digital strategy has an impact on practically every area of a business today, the role of CDO has the power to complement the mandates of every other member of the C-suite team, uniting them “as one.” Each C-suite executive can gain strength and value from the CDO in different ways:
CEOCDO can be the catalyst for the transformation and innovation agenda of the CEO.
TD Bank Group’s CDO shares thoughts on his role
How does the CDO role complement other C-suite roles at TD - particularly the CMO and CIO?
“All three of us sit at the same table and report to the same person, which is a great start in focusing us on collaboration, partnerships and using our expertise to drive what’s right for the customer. There is some overlap, but we all share the same objectives, so that helps resolve issues and move things forward.”
What are your views on the future of the CDO role?
“I see the impact of the role growing, if not the role itself, because our customer-centric strategies have to evolve and include digital to deliver our promise of service and convenience. Digital is prominent in our plans, it impacts our investment strategy and must be considered in everything we do by the entire organization.”
Allies at the gate
Once your organization decides to add a CDO to the C-suite, there are three possible “gateways” for doing so. As you go down the list, each option represents a progressively greater degree of transformation. Decide which gateway fits best with your organization’s situation.
Gateway 1:Elevate a non-executive digital role
- Recognizes digital as a prominent part of the organization
- Declares to everyone that decisions on strategic priorities, market moves and product plays will now include digital
Moderate degree of transformation
- Low degree of disruption
- Makes a statement that digital should be elevated in importance
- Measures would become tighter with greater visibility
Gateway 2:Centralize fragmented capabilities
- Centralizes digital resources to operate in a more coordinated and singularly-minded way
High degree of transformation
- Positions digital as highly important
- Places accountability in a single individual
- Allows digital to operate within existing structures
Gateway 3:Create something new
- Forming a new entity that delivers business outcomes exclusively through digital channels
- Building a challenger brand that operates as a competitor to the legacy business
- Creating an autonomous team internally that supports lines of business but also has some semblance of a profit and loss
Very high degree of transformation
- Breaks monolithic structures
- Sharpens the innovative edge of the parent business
- Creates a new revenue model
Your organization has taken the plunge and hired a talented new CDO – now what? A newly appointed CDO should be ready to hit the ground running and generate momentum right away, using a 90-day action plan.
00Before Day 1:Prep work
Before appointing a cdo, the board and ceo must decide what kind of cdo the organization needs and must establish the appropriate “gateway.”
30Days 1-30:Set the vision
The cdo gains an understanding of the business goals and objectives of all stakeholders, learns where digital capability exists in the organization, and develops a hypothesis for the digital vision.
60By Day 60:Develop the program
After fully assessing the capabilities of the company’s digital resources, the cdo now possesses a deep understanding of the organization’s digital maturity. By day 60, the structure for the new operating model should be established.
90By Day 90:Lock program and execute
The cdo will now have a fully integrated portfolio of digital projects approved and in-flight across the organization. The transition for adopting the new operating model will be in full swing.
A CDO allows you to be “proactively reactive”
Digital technology and its applications are in constant evolution. In this rapidly changing environment, it’s nearly impossible to be completely proactive: trends are increasingly being dictated to organizations, not by them. But reacting isn’t necessarily a bad thing — especially if the organization has invested in a foundation that permits it to act nimbly and quickly.
Being “proactively reactive” requires the organization to have the right leadership, operating model, governance, people and technology. Welcoming a Chief Digital Officer into your C-suite team can help smooth the transition to an exciting and prosperous digital future.