The Rise and Rise of the Chief Data Officer
Everyone nods deferentially when that old adage is uttered about people being the most valuable asset in the business. Being one myself, I’d like to agree. The problem is I don’t think it’s the case anymore. In many recent conversations with business leaders, there’s growing agreement that ‘people’ have been knocked off the ‘number one importance’ pedestal – the most valuable asset any business has is now its data. The Chief Data Officer (CDO) is in the ascendant.
The rise of the CDO highlights the ever-sharpening focus that organisations, particularly in the Financial Services sector, are placing on their data. CDOs are on the increase. There is wide recognition that data is indeed an asset. CDOs are redefining ways in which the organisation drives itself, its relationships with the outside world, its products, services and future success. A recent Capgemini Report[i] suggests that ‘FS firms need to become information-centric enterprises’ not just because of proliferating regulatory reporting demands, but also due to ‘unparalleled competition for customer assets and allegiance.’
Given that data is an asset, it must be treated like one. It has to be protected, maintained, and sustained. Adhering to these disciplines will increase its value and produce the return for the business that well curated and managed data is eminently capable of doing. The only challenge then to be overcome is how quickly the business can unlock the return. The CDO has control of the most valuable asset in the business. At Informatica we believe that he or she will only be in control if a governance and management ecosystem is built on three fundamental pillars:
- Securing the data: This is about more than simply the value of the information asset, and the statutes and legal responsibilities that surround it – it’s about the immeasurable damage to an organisation that can come about if its data is accessed by outsiders;
- Knowing where the data is: It sounds like an obvious requirement but I encounter many organisations that cannot locate all their data, all the time. It has often been accumulated by different departments in numerous locations and divergent formats. It is often widely dispersed with no central view or control because it has grown organically. As a result it is under-utilised. Retrieving it wastes time and money and creates inefficiencies;
- Refining it: Data needs careful and diligent attention to ensure it is always up-to-date and relevant. It needs always to tell the full story. Users must have confidence and trust in the data – knowing they can simply draw down on it and put it to profitable use, in the knowledge that it is optimal, constantly. Like many other assets, data is a raw material which must be refined to be of value.
In a world where technology simplification is the right of passage for kings, how will CDOs rise above the status quo and seize this opportunity with a firm grasp? The question is, how evolved are your foundational pillars?
I mentioned that the CDO is in the ascendancy. Watch this space. I predict the rise in significance of the role within firms is going to be stratospheric. It will rise above all others as organisations recognise that they are data-driven, data-defined, data-centric and ultimately data-dependant. I see no valid reason why CDOs will not only be at the top table but will get the comfiest seat alongside their CEO.
In my last blog, The New Insurance Model, I argued the case for a new design point for company systems and capabilities, where IT architecture should be wrapped around Data First principles. I suggest now that this approach needs to go further, deeper, and wider. The winning FS firm of the future will be one that adopts a Data First Business Architecture – full recognition that the business thrives on the basis of its data. The CDO has arrived, and long may he or she reign.
[i] The Role of the Chief Data Officer in Financial Services