GDPR is pushing the Chief Data Officer role center stage

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Gartner predicted that by 2020 90% of large organizations in regulated industries will have a Chief Data Officer role. With the recent heat around Facebook, Mark Zuckerberg, and the fast-approaching GDPR compliance deadline, it’s quite likely that 2018 will be the year of the Chief Data Officer.

This article was first published in October, 2017 and has been updated to keep up with the latest trends in GDPR.

In 2014 around 400 CEOs and top business execs were asked how they recognize data as a corporate asset. They responded with a mixed set of reactions and viewed the worth of data in their organization in varied ways. Now, in 2018 these reactions have drastically changed – more and more organizations have realized the importance of Data-as-an-Asset. More importantly, the European Union (EU) has made it mandatory that General Data Protection Regulation (GDPR) compliance be sought by the 25th of May, 2018.

The primary reason for creating the Chief Data Officer role was to connect the ends between functional management and IT teams in an organization. But now, it looks like the CDO will also be primarily focusing on setting up and driving GDPR compliance, to avoid a fine up to €20 million or 4% of the annual global turnover of the previous year, whichever is higher.

We’re going to spend a few minutes breaking down the Chief Data Officer role for you, revealing several interesting insights along the way. Let’s start with the obvious question.


What might the Chief Data Officer’s responsibilities be?

Like other C-suite execs, a Chief Data Officer is expected to have a well-blended mix of technical know-how and business acumen. Their role is very diverse and sometimes comes across as a pain to define the scope.

Here are some of the key responsibilities of a Chief Data Officer:

Data Policies and GDPR Compliance

Data security is one of the most important elements that any business must consider. It needs to comply with regulatory standards and requirements of the country where it operates. A Chief Data Officer is be responsible for ensuring the compliance of policies across all branches of business and the associated compliance requirement taxonomies, on a global level.

What is GDPR?

If you’re thinking there were no data protection laws before the General Data Protection Regulation 2016/679, that’s not true. The major difference, however, is that GDPR focuses more on customer data privacy and protection. GDPR requirements will change the way organizations store, process and protect their customers’ personal data. They will need solutions for assessing, implementing and maintaining GDPR compliance, and that’s where Chief Data Officers fit in.

Using data to gain a competitive edge

Chief Data Officers need to have sound knowledge of the business’ customers, markets where they operate, and strong analytical skills to leverage the right data, at the right time, at the right place. This would eventually give the business an edge over its competitors in the market. For example, a ferry service could use data to identify the rates that customers would be willing to pay at a certain time of the day.

Setting in motion the best practices of data governance

Organizations span across the globe these days and often employees from different parts of the world work on the same data. This can often result in data moving through unconnected systems, and ending up as inefficient or disjointed pieces of business information. A Chief Data Officer needs to ensure that this information is aggregated and maintained in such a way that clear information ownership across the organization is established.

Architecting future-proof data solutions

A Chief Data Officer often acts like a Data Architect. They will sometimes take on responsibility for planning, designing, and building Big Data systems and ensuring successful integration with other systems in an organization. Designing systems that can provide answers to the user’s problems now and in the future is vital. Chief Data Officers are often found asking themselves key questions like how to generate data with maximum reusability, while also making sure it’s as accurate and relevant as possible.

Defining Information Management tools

Different business units across the globe tend to use different tools, technologies, and systems to work on, store, and share information on an enterprise level. This greatly affects a company’s ability to access and leverage data for effective decision making and various other duties. A Chief Data Officer is responsible for establishing data-oriented standards across the business and for driving all arms of the business to comply with the standards and embrace change, to ensure the integrity of data.

Spotting new opportunities

A Chief Data Officer is responsible for spotting new opportunities where the business can venture into through careful analysis of data and past records. For example, a motor company would leverage certain sales information to make an informed decision on what age group to target with their new SUV in-the-making, to maximize sales.

These are just the tip of the iceberg when it comes to a Chief Data Officer’s responsibilities. Responsibilities go hand-in-hand with skill and traits required to execute those responsibilities. Below are some key capabilities sought after in a CDO.

Key Chief Data Officer Skills

The right person for the job is expected to possess impeccable leadership and C-Suite level communication skills, as well as strong business acumen. They are expected to have strong knowledge of GDPR software tools and solutions to enable the organizations hiring them to swiftly transform and adopt the new regulations.

They are also expected to possess knowledge of IT architecture, including a familiarity with leading architectural standards such as TOGAF or the Zachman framework. They need to be experienced in driving data governance as well as data quality and integrity, while also possessing a strong knowledge of data analytics, visualization, and storytelling. Familiar with Big Data solutions like Hadoop, MapReduce, and HBase is a plus.

How much do Chief Data Officers earn? 

Now, let’s take a look at what kind of compensation a Chief Data Officer is likely to be offered. To tell you the truth, the answer to this question is still a bit hazy, but it’s sure to pick up speed with the recent developments in the regulatory and legal areas related to data. About a year ago, a blog post from careeraddict revealed that the salary for a CDO in the US was around $112,000 annually. A job listing seen on Indeed quoted $200,000 as the annual salary. Indeed shows 7 jobs posted for a CDO in the last 15 days.

We took the estimated salaries of CDOs and compared them with those of CIOs and CTOs in the same company. It turns out that most were on par, with a few CDO compensations falling slightly short of the CIO and CTO salary. These are just basic salary figures. Bonuses add on the side, amounting up to 50% in some cases. However, please note that these salary figures vary heavily based on the type of organization and the industry.

Do businesses even need a Chief Data Officer?

One might argue that some of the skills expected of a Chief Data Officer would also be held by the CIO or the Chief Digital Officer of the organization or the Data Protection Officer (if they have one). Then, why have a Chief Data Officer at all and incur an extra significant cost to the company?

With the rapid change in tech and the rate at which data is generated, used, and discarded, most data pointers, point in the direction of having a separate Chief Data Officer, working alongside the CIO. It’s critical to have a clearly defined need for both roles to co-exist. Blurring the boundaries of the two roles can be detrimental and organizations must, therefore, be painstakingly mindful of the defined KRAs. The organisation should clearly define the two roles to keep the business structure running smoothly.

A Chief Data Officer’s main focus will be on the latest data-centric technological innovations, their compliance to the new standards while also boosting customer engagement, privacy and in turn, loyalty and the business’s competitive advantage. The CIO, on the other hand, focuses on improving the bottom line by owning business productivity metrics, cost-cutting initiatives, making IT investments etc. – i.e., an inward facing data-management and architecture role. The CIO is the person who is therefore responsible for leading digital initiatives at a board level.

In addition to managing data and governing information, if the CIO’s responsibilities were to also include implementing analytics in fresh ways to generate value for the business, it is going to be a tall order. To put it simply, it is more practical for the CIO to own the systems and the CDO to oversee all the bits and bytes that flow through these systems. Moreover, in several cases, the Chief Data Officer will act as a liaison between the business and IT. Thus, Chief Data Officers and CIOs both need to work together and support each other for a better functioning business.

The bottom line: a Chief Data Officer is essential

For an organization dealing with a lot of data, a Chief Data Officer is a must. Failure to have one on board can result in being fined €10 million euros or 2% of the organization’s worldwide turnover (depending on which is higher). Here are the criteria for an organization to have a dedicated personnel managing Data Protection.

The organization’s core activities should:

  1. Have data processing operations which require regular and systematic monitoring of data subjects on a large scale or monitoring of individuals
  2. Be processing a large scale of special categories of data (i.e. sensitive data such as health, religion, race, sexual orientation etc.)
  3. Have data processing carried out by a public authority or a body processing personal data, except for courts operating in their judicial capacity

Apart from this mandate, a Chief Data Officer can add immense value by aligning data-driven insights with its vision and goals. A CDO can bridge the gap between the CMO and the CIO, by focusing on meeting customer requirements through data-driven products. For those in data and insights centric roles such as data scientists, data engineers, data analysts and others, the CDO is a natural destination for their career progression journey. The Chief Data Officer role is highly attractive in terms of the scope of responsibilities, the capabilities and of course, the pay. Certification courses like this one are popping up to help individuals shape themselves for the role.

All-in-all, this new C-suite position in most organizations, is the perfect pivot between old and new, bridging silos, and making a future where data privacy is intact.

I'm a technology enthusiast who designs and creates learning content for IT professionals, in my role as a Category Manager at Packt. I also blog about what's trending in technology and IT. I'm a foodie, an adventure freak, a beard grower and a doggie lover.

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