Chief Digital Officer: Hot new tech title or flash in the pan?
- 29 July, 2013 11:01
There's a new C-level executive -- the Chief Digital Officer (CDO) -- in the boardroom, charged with ensuring that companies' massive stores of digital content are being used effectively to connect with customers and drive revenue growth.
At first blush, an executive title that includes the word "digital" would seem to encroach on IT's territory. Not so, observers say -- but that doesn't mean tech leaders don't need to be prepared to work closely with a CDO somwhere down the line.
Gartner last year reported that the number of CDOs is rising steadily, predicting that by 2015, some 25% of companies will have one managing their digital goals, according to analyst Mark P. McDonald. (See also CDOs by the numbers.)
While media companies are at the forefront of this movement, McDonald says, all kinds of organisations are starting to see value in their digital assets and in how those assets can help grow revenue.
"I think everybody's asking themselves whether they need [a CDO] or should become one," McDonald enthuses. "Organisations are looking for some kind of innovation or growth, and digital technologies are providing the first source of technology-intensive growth that we've had in a decade."
What CDOs bring to the table
While the CIO and the CDO are both concerned with digital information, their responsibilities diverge sharply.
"The role of IT in the past has been to procure and secure IT equipment for the company, lock [data] up and bolt it down," says Jason Brown, the CDO for trade show and event management company George Little Management. "Whereas with digital content, you want to get it out to the world so the rest of the world can see it and access it. I don't care about Exchange servers, Web servers or any of that stuff," continues Brown, who was hired in September 2011 as George Little's first-ever CDO, reporting to the company's CEO. (Previously he worked as a vice president of digital media for what is now events and media company UBM Canon.)
"I'm interested in building products that can be monetised," he says. "Companies need to look at their products and see areas where they can make money digitally."
Organisations including Sears, Starbucks, Harvard University, the City of New York and many others have hired CDOs, says David Mathison, founder of the Chief Digital Officer Club, where current and would-be CDOs can find training, job opportunities and more. Their goal? To improve efforts in digital content promotion, a motive shared by CDOs from Forbes, Columbia University and elsewhere, who described how they go about helping their companies take advantage of their large digital resources.
CDOs by the numbers
According to estimates from CDO Club founder David Mathison, the top three kinds of companies hiring CDOs today are advertising agencies, publishers and broadcasters, while the biggest growth is being seen in the non-profit sector and state and local governments.
"When I started tracking this two years ago, there were 75 CDOs worldwide in major organisations," says Mathison, who curated the first-ever CDO Summit last February. "Today there are hundreds -- more than 300 at most recent count."
Mathison started tracking CDOs in August 2011 while working at the search firm Chadick Ellig, and he has continued his analysis via conversations and interviews with corporate executives and by reviewing hundreds of resumes and online profiles.
That research, plus data from CDO Club members, indicates that salaries for a Chief Digital Officer range from US$89,000 to $600,000, depending on the business sector and location, with the median falling between $250,000 and $300,000, he says.
"A lot of company leaders really don't understand digital very well," observes Calkins Media CDO, Guy Tasaka, who has more than two decades of experience in advertising, strategy and planning, circulation and marketing for media and startup companies. Tasaka, who reports to his company's CEO, says chief digital officers "should have the future vision in mind and not be constrained by the technical or architectural limitations of the current company."
He elaborates, "CIOs and CTOs don't look at the core business. They look at the technology for technology's sake." As the CDO, Tasaka says, "My responsibility is public-facing technology, the mobiles, the online and everything that we are doing going forward. I won't do anything unless there is a revenue strategy and a sustainable revenue model. My job is to separate what will help Calkins strategically from what is just a shiny object that's cool."
Forbes Media: Building audience, increasing revenue
Michael Smith joined the Forbes Media Group 13 years ago and became its first CDO in 2010 when a new CEO came in and wanted to drive the importance of digital content. Smith, whose background was as a CTO, took on the task of looking at technologies inside the company and how they could be used to better promote its digital content, specifically to grow online readership at Forbes.com.
"As the CDO, I don't make technology decisions -- those are made throughout the organisation," says Smith, who reports to the CEO and president of Forbes Media. "It's the CDO's job to support the adoption of these selections. The focus I have now is on revenue growth. It's far more of a business role."
By tracking new content management applications, online publishing systems and other digital innovations that can be used to create and deliver Forbes' digital content, Smith has been able to help grow the company's online audiences threefold since 2010, to more than 45 million unique users a month. "That's a dramatic increase in users," he says. "This stuff helps the company."
Digital assets defined
All companies have digital data, but digital assets -- content that can be shared with the public or a select subset for profit, improved customer relationships or heightened brand awareness -- are a different beast, one that varies widely by business sector.
For an events firm like George Little, digital assets comprise materials such as audio and video from conferences, as well as other stored content from events; this is then repurposed and sold by the company, says CDO, Jason Brown.
For a print, online and broadcast media company like Calkins Media, digital revenue opportunities come from advertising to mobile users, targeting ads to online visitors and finding new opportunities that no one has considered before, according to CDO, Guy Tasaka.
For a healthcare provider, digital content could be general medical information about procedures and therapies for patients and prospective patients, ideally showcasing the expertise of the provider's in-house medical staff. And for a manufacturer, digital assets could encompass product catalogs, advertising, white papers and video and audio content aimed at enhancing customer satisfaction with current purchases and spurring new business as well.
Columbia: Changing delivery of digital assets
At Columbia University in New York City, Sree Sreenivasan, a journalism and media professor at the school, also held the title of CDO beginning July 2012, reporting to the school's chief academic officer. His main responsibilities? To "address digital needs to be sure that the school is adjusting and morphing with all the changes that are happening" in the digital marketplace, he says.
Sreenivasan has been cataloguing and placing online two decades worth of media initiatives at Columbia (they used to send VCR tapes of classes to long-distance students in the late 1980s, he reports) and helping faculty, departments and schools learn more about online learning, along with social and digital media.
Columbia has offered online courses for more than a decade and distance learning since 1986, but those efforts typically have been decentralised inside the various schools, Sreenivasan explains. The goal today is to build a single site where all the online material -- from individual courses to entire programs of study -- can be easily found.
"Education is changing," said Sreenivasan. "We need someone to be looking at it centrally. That's my role. We are now trying new things."
"Coursera is an example of a different approach -- we want to use it to learn how to improve the experience of our in-person classes, as well as reach out to the world," says Sreenivasan. "Our first three classes had more than 100,000 signups, and we have several ideas on how to take this further to improve the experience of our on-campus students as well as those in hybrid programs."
Doe-Anderson: Leading through digital disruption
At Doe-Anderson, the fourth-oldest advertising agency in the US, Joe Pierce has been the CDO since October 2009, reporting to the company's chief creative officer. In his job, he oversees whatever the company's clients want to do that's digital, including websites, banner ads, mobile apps and online advertising buys.
"Almost anyone you meet in the land of brand/digital marketing has a horror story they can tell you about the website that never worked, the app no one downloaded, the banners no one clicked on, and so on," says Pierce. "Usually, these horror stories stem from the simple fact that there wasn't a geek in the room who had the experience, wisdom, gravitas, mojo, trust, whatever you want to call it to steer the team away from risk and to keep the focus on the win."
To Pierce, this gets to the heart of what the CDO is all about. "You're a Sherpa. It's your job to get your client, or organisation, to the top of the digital mountain as quickly and safely as possible."
In making that journey, Pierce's IT background, as well as stints elsewhere as a CEO and COO, has come in handy, he says.
"You can't be a strategy guy unless you understand the technology that you have to implement to fulfill that strategy," says Pierce. "And you can't do business in the C-level suite now unless you've got that digital knowledge to talk business with a customer. Having someone in the room that has that experience can help. I call it being 'the nerd at the table.'"
Will the CDO title endure?
There's little doubt the nascent Chief Digital Officer role is in flux. This month, Sreenivasan is scheduled to leave Columbia to become the first-ever CDO at New York's Metropolitan Museum of Art, where he will report to the associate director for collections and administration. In his new job, Sreenivasan will explore new digital opportunities for the Met and lead its Digital Media Department, which is responsible for managing and producing digital content.
Smith too recently left Forbes, but not for another CDO title: He's now vice-president of revenue platforms and operations at Hearst Magazines Digital Media, where he reports to the company's president and is responsible for aligning technology, content creation and advertising.
It's perfectly natural to create a C-level role when the technology is new, but ... you can be a digital company without having a CDO. Mark McDonald, Gartner
Which leads to the question: will the CDO craze last, or is it simply an interim title useful in the short term for corporations undergoing digital transformation?
Sreenivasan says CDOs are new and needed today (and notes that Columbia plans to hire a replacement CDO to fill his position), but acknowledges that could certainly change in the future. "I imagine there was once a chief telephone officer at Columbia long ago, but that wasn't needed after people figured out how to use the phone. This job could go that way, that someday they won't need somebody with this title."
McDonald, the Gartner analyst, agrees. "It's perfectly natural to create a C-level role when the technology is new, but as the organisation builds an understanding of that technology, it works its way back into core operations. You can be a digital company without having a CDO."
Nigel Fenwick, an analyst with Forrester Research, said he certainly sees the role of a digital content leader, but not necessarily the CDO title, sticking around for enterprises.
"There's a need to put your arms around your digital business, absolutely," says Fenwick. "I completely believe that that is going to be a strategy for businesses going forward. This is partly why the executive level sometimes has to shake things up a bit to get things where they need to get to. [The CDO title] is one way of doing it."
Todd R. Weiss is an award-winning technology journalist and freelance writer who worked as a staff reporter for Computerworld.com from 2000 to 2008. Follow him on Twitter, where his handle is @TechManTalking, or email him at email@example.com.
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