As part of their digital roadmap, organizations are increasingly taking advantage of big data and making analytics a core aspect of their business. Many of these underline the strategic importance by adopting their organizational structure, with 43% of enterprises having reorganized or are currently reorganizing in order to harness big data opportunities. At the end of 2015, 25% of enterprises already had a Chief Data Officer (CDO) in place; this number is estimated to climb at a rapid pace, reaching 90% by 2019. One of the driving forces behind this growth is the rising spending on big data technology, with 54% of companies intending to increase their investments until 2018.
Big data is changing traditional industry boundaries and enabling new competitors to enter across a multitude of sectors. Most companies have therefore been experiencing a phase of disruption and transformation as the digital revolution progresses.
As a result, there will be a greater need for new information management roles as enterprises rush to capitalize on their big data efforts.
Data is often cited as a new currency and a critical asset for future revenues, being equally as valuable as existing products and services. Yet, with absent or lackluster leadership attention, many big data projects are foredoomed to fail.
The Chief Information Officer (CIO) is often caught in a bimodal tradeoff, having to deal with highly demanding business units, which are striving to exploit new data-driven opportunities on one hand, and fairly conservative units on the other hand, which are reluctant to change and heavily pushing back on transformation initiatives.
Today’s CIO has to balance these partially contradicting requirements and is, beyond operating the IT environment, often confronted with an overloaded agenda, including digital innovation, security, compliance, procurement, and change management programs. Hence, the CDO role will become a critical component to ensure effective data control and management as well as progression across the various data-related activities.
Analysts estimate that companies lose on average about US$13.5 million every year because of poor data quality. With rising dependency upon data and missing governance, the situation will not abate and is likely to get worse. Besides the need to adequately staff leadership positions and incorporate the CDO role into the boardroom, much ground work still needs to be done. The shortfall of data science and big data experts in the US alone is estimated to be anywhere from 140,000 to 190,000 by 2018.
Gartner has predicted that more than 50% of all companies will use state-of-the-art algorithms and analytics by 2018. To a great extent this trend is being driven by the emergence of the Internet of Things (IoT), a multitude of connected devices, and the power of cloud computing, which presents unprecedented opportunities to capture, process, refine, analyze, and monetize shiploads of raw data.
With almost infinite opportunities to collect data, gain insights and derive business value, the key challenges are how to exploit this rapidly expanding ecosystem, identify the right opportunities and eliminate possible roadblocks (budgets, governance, expertise, company culture, compliance, competition, etc.).
There’s little doubt that the trend of using and monetizing Big Data technology will only grow. In fact, by 2020, it’s projected that over 75% of companies will leverage analytics technology to make better decisions. Thus, a CDO will have an exclusive opportunity to transform a company by drafting a battle plan that will bridge the data science skills gap, building and enhancing the data infrastructure and analytics capabilities, and developing data-driven projects that yield economic value.
Many companies create a separate data and analytics team and hire a dedicated leader, as the rise of the CDO demonstrates. While rapid decision-making and faster execution are among the advantages when elevating data and analytics teams toward the boardroom, the co-existence comes along with a price tag; that is, the risk of operating in silos. For a company to be successful, the CDO and team must work alongside the rest of the organization to ensure that quick decisions are made without creating redundancies.
By Marc Wilczek
