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The emergence of the Chief Digital Officer

Large companies employing ‘digital doctors’
 to conduct ‘digital triage’ in leading corporate change

The digital era is causing the C-suite to be disrupted as much as the companies led by these executives. Digital transformation is changing the composition of boards to reflect a new reality in how businesses are managed.  As many large companies undergo the equivalent of open heart surgery while running, it is also causing the emergence of a new role: The Chief Digital Officer (CDO).

In South Africa, a number of companies have recently appointed CDOs, from banks to telecoms to property companies; a reflection of the urgent need to respond to profound changes taking place in their respective markets. Virtually every industry is undergoing extraordinary change as part of what John Chambers, Executive Chairman of Cisco, refers to as the “biggest technology transition ever.”  As these massive changes take place, leadership is a core ingredient to navigating the digital landscape faced by organisations as they seek to reinvent positions, roles and business models.

The CDO should be considered an amalgam of the Chief Technology and Chief Information Officer roles who is in charge of assessing and affecting the digital health of an organisation. Information systems and “being digital” are now at the heart of most businesses, and as such, to understand the ‘digital circulatory system’ of an organisation, and all it components, is part of improving the health of any business. The Chief Digital Officer is not just a techie who keeps systems running, but a critical player in forming and executing on strategy that positively impacts business outcomes. In effect, they oversee the healthy functioning of critical organs of a business, including the board, the ability for the business to innovate, right through to the employees and technology systems of the business.

The CDO drives innovation as part of forming digital strategies and the development of new products. As organisations undergo digitization, it is a significantly more profound exercise than a ‘digital transfusion’.  In many cases, it involves evolving parts of a business in order to improve productivity, collaboration, communication and business processes across the organisation.

The Digital triage

Overseeing network systems, information services, software development, and digital communications, a CDO must touch on design, development, management and maintenance as they conduct ‘digital triage’ of their company’s strategic priorities. Dealing with big data, analytics and market segmentation, a CDO must address four drivers of profitability; namely: simplicity, security, scalability and agility.

  1. Simplicity; a CDO must find ways in which to run an organisation as efficiently as possible, balancing resources against strategic priorities.
  2. Security; a CDO must ensure that security systems are prepared and able to mitigate against an increasing threat landscape and the explosion of more points of infection (i.e. mobile devices and Internet of Things connections across a set of multiple contact points).
  3. Scalability refers to the pace with which an organisation can deploy innovation at scale. It involves the extent to which a business can build new business models (or at least react to newcomers disrupting theirs). This is one of the most critical aspects of a CDO’s job: getting big, fast and securely.
  4. Agility involves the development of new ecosystems, responding to new entrants and anticipating behavior shifts among customers. In so doing, CDOs must challenge assumptions made in the past, the ways a company delivers value, operations, and even the culture of an organisation.

Unprecedented pace of change

Consider thirteen-year-old Facebook that, less than five years after hitting the one billion mark, now has two billion monthly active users. This is the pace of change that is happening around us. But few companies are moving fast enough. According to a recent study by the Global Center for Digital Business Transformation which spoke to Executives in 13 countries:

  • 37% of incumbents will be displaced;
  • The horizon for disruption was considered to be within the next three years; but
  • Only 25% of them are actively responding by digitally disrupting their own business.

In the past, it took years to build, design and implement systems and products. Today, with the cloud, software and global teams and processes, deployment of new technologies and products can take months. It would seem that in this context, for CDOs, the proverbial aphorism carpe diem (“seize the day”) is being replaced by carpe discidium (“seize the disruption”).


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