Analyst firm International Data Corp (IDC) certainly think so. IDC predicts that, by 2020, 60 per cent of CIOs in global organisations will be replaced by CDOs for the delivery of IT-enabled products and digital services. As this transition occurs, CIOs will be devoting a considerable proportion of their time to creating new revenue streams through digital services.
Why are organisations creating the position of CDO?
Boards at progressive organisations are creating the position of CDO to manage and profit from the impact of cloud, mobility and digital technologies on traditional business models. These groundbreaking technologies and resulting changes are transforming every function within businesses, and opening up a wealth of new marketing and sales opportunities.
So why not make the CIO responsible for digital development? The responsibilities of most CIOs already encompass technology policy, procurement, governance, disaster management, budgeting and more. This gives them little time to deliver the technological knowledge and capability to help C-suite colleagues such as the chief executive officer (CEO) and chief marketing officer (CMO) as they navigate these changes.
In addition, CIOs themselves are concerned about the scope and scale of digital transformation. Gartner found in a recent survey that 51 per cent of CIOs were concerned that the “digital torrent” was coming faster than they could cope with, and 42 per cent felt they didn’t possess the skills and capabilities to handle this future.
Are businesses in Australia embracing the CDO role?
In Australia, the CDO role continues to gain credibility and stature in some quarters. The National Commission of Audit this year recommended a CDO be appointed from an accomplished pool of private-sector candidates to promote e-government initiatives, and report directly to the Minister for Communications.
Yet many businesses in Australia and beyond seem hesitant to create a CDO role or provide a position description that unshackles an appointee to unleash the full potential of digital technologies. In a recent blog post, Kieran O’Hea, former CDO of the City of Brisbane, explained why he thought Gartner’s 2012 prediction that 25 per cent of organisations would have a CDO by 2015 was unlikely to come true.
O’Hea said that while some positions would effectively be a CDO by another name, or appointed internally, these would not bridge the gap between the five CDO roles advertised on LinkedIn and the Gartner estimate. Companies were not comfortable with a C-level appointment and were advertising top digital positions under other titles, or were uncertain about what the role should be and which position it should report to.
What are the implications for the CIO?
So where does this leave the CIO? While the more bullish predictions about the CDO’s emergence in the corporate world may not be correct, there is a strong chance they will become a reality in the longer term. Under this scenario, CIOs could find themselves becoming redundant as the executive component of their duties is absorbed by the CDO and other technology responsibilities are handed further down the managerial food chain.
One option for the CIO is to upgrade their skills and capabilities to assume the role of CDO. With a sound understanding of the role technology plays in the growth and development of their organisation, the CIO is better placed than most other C-suite executives to tackle the challenges of the new position. The CDO position also presents a unique opportunity to transform a business and position it to become competitive for years into the future.
