I recently revisited a whitepaper I wrote in 2011 where I looked at the transformation that would take place in customer hosting strategies with data becoming the pivot of all services. This emphasised the continued shift from infrastructure led technologies to a data centric focus for many organisations. I have never been enamoured with the phrase “Big Data” as it conveys no real meaning and covers such a multitude of disciplines. Data is the most important element, the size and shape is immaterial – it is what you do with it.
But this data transformation has many parts, the largest element associated with the cultural invention most organisations will need to undertake in terms of data leadership. When asked what a CTO does within and for a business, I often articulate this as enabling the business to do more through systems, applications and technologies. This involves the collection, collation, processing, security and integration of these systems, application and technology. However, understanding the data in the business, and outside the business is not a key role. Understanding data value and ensuring it provides accurate and useful analytic outputs combines understanding, science, mathematics and technology. The value held within that the right data will drive better decisions and enhancements to your customer experience as a key differentiator to your business. So what’s the plan?
At a recent business forum – I posed this question. The audience, many of whom were CIO’s across a wide spectrum of businesses, had a different perspective. We all agreed that it was difficult to generalise but all of our roles where there to add value to the business. CIO’s aren’t necessarily hands on in terms of IT resources but develop visions and strategies which are driven through policies and programmes that engage the business and empower people to deliver and contribute. Whilst there was a healthy discussion surrounding business value measurement of IT staff, there remained key areas of value creation associated with understand business data which lacked business ownership or leadership.
Figure 1 - The emerging role of the Chief Data Officer
The emergence of the Chief Data Officer (CDO) role in businesses large and scale is a reflection in part of this gap analysis. It isn’t just about monetisation but new engagement models which enable technology to add value in so many news ways. The questions become how does this come together and how do we measure success?
Let’s frame the challenge. Businesses have data and lots of it. And we are collecting more and more. Is there an owner for this data and value creation from the data within the business? Is all the data important and what metrics are being used to assess the data value?
What insights can we gain from analysing the data? How do these data insights inform and improve our customer influence and experience, investment decisions, attract new business opportunities and achieve differentiation further? If you can answer all these questions positively then you are in a great position but it is continual evolution. However, if you cannot, your not alone as the majority of CIO’s at our session responded that they were only addressing two of these questions positively.
What this gap analysis identifies is the role of data strategy and value creation is evolving and expanding within every business and there is not a clear custodian or owner to optimise the value from the data. People have and will always be the most important asset to the majority of businesses. Data is our next most valuable asset so we must consider the development investment in maximising the potential from data as seriously as we consider our people. Numerous surveys have identified that the customer buying decision lifecycle is increasingly informed by information, opinion, sentiment and analysis prior to any form of engagement.
The evolution and development of the CDO role has been most pronounced within more heavily regulated and insight focused sectors such as financial and legal services where data metrics are more mature. It will understandably take time to justify the value a dedicated senior data leadership role can have in an organisation at our on-boarding points within the journey are individual just like our objectives. But this is just one of the many opportunities for organisations around the globe.
Image the customer insight which could be harnessed from data contained within your SAP landscapes right now. The accelerated adoption of SAP HANA is no coincidence as companies seek to rapidly analyse and inform existing and new business strategies from existing data. As a technology enabler, HANA provides a platform on which to rapidly analyse and report on your business warehouse data. Establishing who owns the data in the warehouse, what metrics are used to assess which data sets are loaded into HANA and how insights will be analysed requires an updated business strategy. One which can be owned by a CDO. This is the true value of HANA – not just faster analytics per se but informing and focusing the organisations expertise and resources on the very best opportunities as well as areas of revenue growth and cost optimisation.
In my next blog we will explore these focal points in more detail. But what is clear is that we all want to add value but to maximise that value we have to leverage data differently. We are a sum of the equation in enabling, engaging and envisioning with the business. The power of insight and how this can be harnessed for each organisation needs data leadership. These are exciting times - Make me a CDO.
Matt Lovell – CTO @ Centiq