Digital transformation requires a Chief Digital Officer

26th May 2016

We’ve posted before about the need for organisations – both established businesses and high-growth firms – to have a Chief Customer Officer on the board. Customer experience is a senior-level conversation and without someone to make sure it is front of mind with the rest of the board, it can easily be neglected.

But without wishing to swamp the boardroom with additional members, I would also like to make the case for a Chief Digital Officer (CDO). If companies are serious about digital transformation (and if they aren’t, they need to ask why on earth not) then having a CDO either on the board or with a direct line to the board, is fast becoming essential. Here’s why.

Digital is everything

Digital is a massive part of almost everything that consumers do in 2016. People use digital tools to shop, bank, pay for items, communicate, when they are travelling – and more often than not, their behaviour is far in advance of a brand’s own ability to innovate.

This is certainly true of many more established firms, for who digital transformation is a bigger task than a high-growth firm that is much more rooted in digital, and understands the need to base their entire proposition and offering on digital. But regardless of a company’s maturity, digital should inform completely how a brand connects and interacts with a customer and also the type of customer experience they deliver.

In terms of the customer experience, this goes way beyond adding additional resource to the social media customer service team, it means using digital as the basis for offering a first-class and integrated customer experience, across all channels.

Yet digital transformation has barely started

That is the ideal, something that most smart companies will be aiming for. But digital transformation is a highly complex process and many organisations are not integrated digitally. The digital team (or teams) are often siloed and don’t always have input into the overall strategy or direction of a company or its products and services.

If a company has digital embedded in its very DNA, then there is no need for a CDO. But few companies are that advanced, so a CDO becomes one of the most important roles in the entire organisation. Instead of digital transformation falling under the remit of the CIO, CMO or even a COO, having a CDO in place means there is a focus on integrating digital throughout the business and it prevents digital becoming more isolated than it already might be.

The role of a CDO

While many CDOs come from a marketing or sales background, this is by no means universal. A CDO will oversee the digital transformation of many systems and functions, including sales and marketing, but also operations, HR and overall culture, as well as looking at products and services.

It is vital for a CDO to retain a strong customer-focus too. Consumers are invariably ahead of what organisations can deliver, so it is important to stay on top of the latest requirements. A recent study revealed that just 6% of the world’s top 1,500 companies had created the role of CDO or equivalent, but it also stated that it expected that number to increase dramatically over the next 18 months.

There is no blueprint for universal success in digital transformation. But without someone to work with the rest of the board, defining and delivering a digital vision for the company, and integrating digital across the entire organisation, then it is hard to imagine too many firms being successful. All hail the CDO – the next few years will see that role become one of the most influential in any company.

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