Why Do We Need a Chief Digital Officer?

Given the importance of digital technology and transformation, more enterprises are creating the position of chief digital officer (CDO) to tie together business and technology initiatives. But why do you need a CDO? Digital means technology, and technology is the purview of the CIO. By creating yet another “chief” position relating to technology, don’t you impede the influence of the CIO?

That’s a highly contentious question, with proponents on both sides. On the one hand, there are the advocates of the CIO. They would argue that CIOs have had to wage this battle before. Back in the early days of the web, there was a surge toward the idea of e-commerce officers. Suddenly they were the saviors of the online marketplace, bringing the company into the 21st century. But with time, as e-commerce became just another channel, the responsibility flowed back to realm of the CIO.

On the other hand, proponents of the CDO – in some cases, rightfully – argue that the CIO should focus on infrastructure, keeping the lights on and the machines running. There are many CIOs who, having come up through the IT ranks, are really good at this, but may not be really good at understanding the business.

If you’re in a company with a CIO who knows and loves infrastructure, and really isn’t interested or even capable of moving beyond that, then by all means, bring in a CDO. Many companies have digital initiatives but they work best when they are addressed holistically rather than departmentally. Furthermore, new kinds of data sources are being created every day (consider the Internet of Things). That’s where the CDO comes in.

As indicated by the “chief” designation, the CDO is a strategic position. In these days of digital transformation, the CDO is the transformer-in-chief. Not only that, but as technology becomes an integral part of the business, the right CDO also becomes a “translator-in-chief,” acting as the diplomatic courier between the old-school CIO and the other C-level executives, from the chief marketing officer to the chief financial officer.

The CDO fills the gap, ensuring that the company proactively embraces innovation, rather than letting a startup disrupt the company. Think about a company like General Electric, which is using technology and forward-thinking to recreate itself as a digital company, one that just doesn’t build equipment, but creates business models to digitally monitor and service that equipment. The CDO asks the question: what kind of company could disrupt us, and how do we become that company?

Interestingly, there’s a third argument to be made about the CDO. This one postulates that they, too, will follow the trail of the e-commerce officer and disappear within the lower ranks of the company. Why? Because digital technology will, before long, become the norm. Will there someday be no more of a need for a CDO than there would have been for a chief typewriter officer?

But in the meantime, there’s much work to be done. Perhaps job titles matter less than skills: change management, imagination, diplomacy, creativity, etc. Ultimately, no matter what the title, the role calls for someone who can lead a company through the digital transformation.