The Real Power of a Chief Digital Officer

Only some months ago no one really knew or had ever heard of the job function Chief Digital Officer or “CDO”, at least in Europe this job function is quite rare. Nowadays more and more enterprise companies are starting to hire candidates for this position. What do you need to take care of when searching for a perfect fit? What to take into account when it comes to reporting and team building? Here’s some advice to get an integrated and recognized CDO into place.

Profile – What does this person need to be?

• We have seen a lot of new hires for this Chief Digital Officer position – so let us first have a look at the current candidates who took over this task.
  • McDonald´s the CDO role is filled by a former General Manager of Kindle/Amazon
  • At Axa Insurance the CDO was a former Global Business Development Manager at Colgate
  • New York State hired a CDO who worked as CEO of a citizen journalism platform.

Only three random examples already show that there is no clear CV structure for a role such as the CDO. So, what is it all about? Let me tell you: Digital Understanding and Management Skills. That is all – and yet that is so hard to get. We could break down those two main aspects into more detailed functions like responsibility for digital marketing campaigns, digital consumer experience, social media expertise, managing the online team etc. but with the two strong arguments of Digital Understanding and Management Skills all is said.

Decisions – What are their responsibilities?

• So, what are the responsibilities? Even if we were not able to define it, we can all agree it will be a growing responsibility for sure. Tomorrow, in the next year, in 5 years the spectrum will grow. The team will grow, the relevance of the digital channel will grow (further). He/she has to have the full power of all communication channels and marketing channels. If you compare this responsibility to the tasks of the “normal” Marketing Director or CMO, the CDO is surely more advanced and on a higher hierarchy level.

Reporting – Who does the CDO report to? Who reports to them?

• Well, the CMO should definitely report to the CDO. Although not all aspects are relevant for the CDO´s task (such as Event Management, classic PR, Sponsoring) the CDO has to know them all and include them in the digital channels and digital landscape. The CDO should – per C-Level definition – report to the CEO directly, not to the CTO, not to the CIO.

Team – Who are the main team members to support success?

• The CDO’s main team members are:
  • Head  of Analytics
  • Head of Communication/PR
  • Head of Online Marketing
  • Head of eCommerce

And the Head of Analytics should report directly to the CDO, not to the Head of Online Marketing or CMO. This is the only chance to get real time figures and enable real time decisions in the digital atmosphere and to create a data-driven culture in a company: From the CEO down to every hierarchical level.

The Chief Digital Officer needs to be one of the most visionary characters in the company and in the Executive Team. Yes, the CEO should have that ability to, but less so the CIO or CFO. The CDO needs to be two steps ahead in his/her vision and the targets for the company and department.

A Definition attempt

According to Russell Reynolds the CDO “oversees the full range of digital strategies and drive change across the organization”. According to Gartner the CDO is “an individual who helps a company drive growth by converting “analog” businesses to digital ones, and oversees operations in the rapidly changing digital sectors as well as “wild” web-based information management and marketing”.

Both not 100% complete or correct in my point of view. Why would the CDO need to drive change across the organization? Yes, the digital channels are new and most of the employees around the CDO are not familiar with it, but this will change over a certain period of time, so there is no strong need to drive change. The second definition states that the CDO helps a company. No, the CDO should help his or her company, not a company – because this role needs to be embedded in the Executive level and  therefore can not be an external consultant. And does the CDO have to convert analog business in digital business? Again no: some analog business can only exist in the analog channel and is very well positioned in there. Like Events or congresses etc.

Let me try:

“The Chief Digital Officer is an Executive Team Member who manages the company`s digital touchpoints and educates about digital developments as well as actively influences the digital and analog future of the company.”