With data now easier to collect and analyze than ever before, companies are recognizing the business value of such information — and the need to tap into it quickly. Enter the chief data officer (CDO), the newest role in the C-suite that is responsible for defining and putting into place a data management strategy.

According to Gartner, it’s estimated that 90% of large global organizations will have a CDO by 2019, but only 50% will be considered a success. That gap can be explained by a plethora of roadblocks that arise when a company attempts to change its organizational and cultural landscape to make room for innovation. Here are the top five challenges your CDO is likely to face when newly minted into an organization.

1. Securing buy-in from the top.

Despite having a C-level title, CDOs unfortunately are not always given the same authority as other executives. Instead, they are often viewed as junior to their executive counterparts. This is a shame because without C-suite buy-in, it is basically impossible to move data and analytics away from a purely technical initiative and towards a business one. When all is said and done, an organization takes its direction from the top — only once the CEO is advocating for the role will a CDO have the momentum to create essential and strategic data management. In fact, of the companies currently seeing value from data science, only 4% have a lack of support from the executive team, according to Forrester.

2. Fighting resistance to change.

Any time an organizational shift is required, it may spark some internal resistance. This is especially true for the CDO. The third annual Gartner Chief Data Officer Survey named “cultural challenges to accepting change” as one of the top internal roadblocks to success. Departments understandably may have a hard time relinquishing control, or comprehending the benefits of doing so.

This is why it is important for the CDO to lead an entire internal marketing initiative to educate everyone in the company — from senior executives to frontline associates — on the value of internal data integration. He or she must incorporate this narrative into every aspect of the organization, from company culture to the business intelligence landscape, in order to lessen this uphill climb.

3. Avoiding technological distractions.

Since the role of CDO encompasses everything from data management to data science to business analytics, the CDO can easily get caught in the weeds of tactical work. This ultimately detracts from their main priorities of identifying opportunities to leverage and enrich existing data, tapping into new data sources, and monetizing data. Once a CDO starts having to manage data or systems, they are no longer focused on implementing these business-wide strategies as they should. As with any large undertaking, chief data officers shouldn’t spread themselves too thin and leave data functions strictly to the chief information officer (CIO)’s department.

4. Countering unrealistic expectations.

It’s a grand day when company leadership finally backs up the need for a designated data “parent,” but this milestone is just the beginning of the real work. Typically, due to high expectations and limited knowledge, business users underestimate the amount of effort and time it takes to build a data-centric or analytics-driven solution, and expect the CDO to turn things around single-handedly. In reality, the CDO’s first job is to provide the right direction for the business to move in, and this involves everyone’s commitment and participation.

5. Delivering measurable success. 

Currently, there is also a lack of meaningful metrics to measure the effectiveness of the CDO’s role. This makes sense since the linkage between data and revenue or impact in an organization isn’t always so direct. After all, organizations aren’t usually selling data itself, but products or goods that rely on this data. So when the return on investment of centralizing and organizing data is difficult to measure, stakeholders may be less willing to give it the wings it deserves. In order to stay a competitive advantage, CDOs must establish clear metrics against their goals from the very beginning of their role.

If handled correctly, the impact of a CDO on an organization can be significant and lasting. From creating business value and managing firm-wide risk to reducing cost and driving innovation, CDOs are crucial to data-driven transformation and organizations would be smart to know how to set them up for maximum success.

Joanne Chu
Joanne Chu

Content Specialist at DataScience.com

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