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Forthcoming,MISQuarterlyExecutive,Leeetal.2014
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A Cubic Framework for the Chief Data Officer (CDO):
Succeeding in a World of Big Data
Yang Lee
Northeastern
University
y.lee@neu.edu
617-373-5052
Stuart Madnick
MIT
smadnick@mit.edu
617-253-6671
Richard Wang
MIT
rwang@mit.edu
Forea Wang
Stanford University
forea@stanford.edu
Hongyun Zhang
Xi'an
Jiaotong University
zhanghongyun@mail.
xjtu.edu.cn
ABSTRACT
A new breed of executive, the Chief Data Officer (CDO), has stepped onto the stage,
emerging as a key leader in the organization. To help readers understand this
development, we provide a three-dimensional framework that describes the role of the
CDO. The three dimensions include: (1) collaboration direction (inward vs. outward),
(2) data space (traditional data vs. big data), and (3) value impact (service vs. strategy).
We illustrate the framework with examples from early adopters and provide
recommendations to help organizations assess and strategize the establishment of their
own CDOs.
Keywords: chief data officer, CDO roles, big data, data management practice,
enterprise data strategy, extended-enterprise data strategy, data quality, data
architecture, data governance, business analytics
Forthcoming,MISQuarterlyExecutive,Leeetal.2014
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A Cubic Framework for the Chief Data Officer (CDO):
Succeeding in a World of Big Data
EMERGENCEOFCHIEFDATAOFFICERS
Increasingly, companies expect that “big data,” with its focus on volume,
velocity, variety, value, and veracity,
1
will be a powerful strategic resource for
uncovering unforeseen patterns and developing sharper insights about customers,
businesses, markets, and environments. For example, some hospitals are using
machine learning algorithms on patient data and insurance claims data to find
unforeseen patterns and insights. Mountains of patient satisfaction survey data, a kind
of unstructured big data, can now be text-mined for sensitivity analysis. As a result,
hospitals can now determine how to improve their patient satisfaction scores, which
are directly tied to the federal government’s reimbursement to the hospitals.
Who can manage providing this insight from data for organizations? Data
scientist roles have emerged to capitalize on the analytical opportunities of big data.
However, hiring data scientists into operational business units without leadership at
the corporate level might be insufficient for a corporation to harness the full value of
big data. A recent survey
2
of over 500 global executives reveals that most companies
are still learning how to manage big data at the enterprise level. The survey also
reveals that companies that have a top executive responsible for its data management
achieve higher financial performance than their peers.
Who is this top executive? In response to the influx of big data, leading
organizations have established a new breed of executive, the Chief Data Officer
(CDO). Wikipedia defines the CDO role as follows: “This role includes defining
strategic priorities for the company in the area of data systems, identifying new
business opportunities pertaining to data, optimizing revenue generation through data,
and generally representing data as a strategic business asset at the executive table.”
3
In
reality, some CDOs strive to exploit big data for business strategy, while others focus
solely on data preparation for external reports, overseeing compliance, and
establishing data governance.
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Almost everyone agrees that Big Data is important, but few can agree as to what defines Big
Data. In our research, we define Big Data to have five key characteristics, known as “the five
Vs”: Volume, Velocity, Variety, Veracity, and Value. Note Veracity and Value, which are
often omitted in Big Data definitions. Regarding veracity, it is not enough to have lots of high
speed diverse data if the data is of poor or uncertain quality.
2
A summary of current global practice with regard to big data can be found in “Big data:
Harnessing a game-changing asset” Economist, August, 2010. It explains in detail the current
practices of over 500 global companies with easy-to-understand tables and figures that are
based on a large sample survey.
3
The Wikipedia page on the Chief Data Officer is a good starting point for scanning the
industry’s current trends, but it does not provide a complete picture:
http://en.wikipedia.org/wiki/Chief_data_officer .
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WHYACHIEFDATAOFFICER?
Leading organizations have learned an important lesson – that seemingly-
tedious data problems are often fundamentally business problems. As such, data
problems can reflect weaknesses in business strategy and operations. Traditionally,
organizations have addressed data problems by assigning a small group within the IT
department to clean up data. As it has become evident that data problems, particularly
business problems rooted in data problems, cannot be solved by the IT group alone.
Organizations have appointed data managers with various data-related titles, such as
data quality managers, data quality analysts, and data stewards. Data governance
mechanisms, committees, councils, and workgroups have also been developed to
identify and solve data-related problems and resolve data-related conflicts. Finally,
enterprise architecture and data architecture have also been employed to align data,
IT, and business processes and strategies.
Despite these efforts, organizations have continued to face data issues, and
their ongoing concerns have led a growing number of organizations to establish an
enterprise-level, executive-rank CDO. Some might argue that traditional data-related
managers and data governance mechanisms can deliver the same results as a CDO.
However, there are critical differences between the efforts of low-level data managers
and those of executive-rank CDOs. The key contrast lies in organizationally-
sanctioned leadership and accountability appropriated to the executive level CDOs.
First, unlike data managers, the CDO can lead the effort to build an
organizational capability that can energize and sustain the entire organization and
extended enterprise. More importantly, CDOs are responsible for communicating and
collaborating with internal and external partners and stakeholders.
One representative case clearly speaks to the inherent challenges that data
managers face during such projects. While attempting to reexamine the business
processes that collect, store, and use customer data, one data quality manager (lacking
the authority of a CDO) in a major healthcare institution recalled receiving this
complaint from an executive: “You are digging in my backyard – Get out of my
backyard!” One data manager recalled the project as: “A huge responsibility without
authority.” As a result of these obstacles, the entire project was discontinued; the
group working on the project was dismantled; and some members left the company.
Indeed, working at the low data-manager level limits the reach of communication and
collaboration because managers are not in a position to dictate business process
changes to higher rank executives, let alone external sources.
The second critical difference between a CDO and traditional data managers or
data governance mechanisms is that the CDO can be held accountable for a failure of
leadership in resolving data problems. Data governance mechanisms, such as data
quality and governance councils, committees, and workgroups, can be useful for
continuous improvement of data policies or standards, conflict resolution, reconciling
and authorizing data sources. However, because members have their own
responsibilities outside of the committee or workgroup, they are usually not held
accountable for governance results.
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To be clear, the CDO does not replace the need for data managers or data
governance. Rather, the CDO leads data managers and enhances the effectiveness of
existing governance by putting data on the organization’s business agenda and in the
minds of other executives and officers. Under the leadership of a CDO, business
strategies reflect and exploit data, particularly big data, instead of treating data merely
as a by-product of running the business
4
.
TheHistoryoftheCDO
The first recognized CDO was established nearly a decade ago at Capital One
in 2003. Yahoo! and Microsoft Germany were also early adopters of the CDO position.
More recently, CDOs have been established at global investment banks, consumer
banks, consumer credit institutions, financial institutions, IT and data companies,
healthcare organizations, US federal and state governments, and US military
organizations. For example, the US Federal Communications Commission (FCC)
created in each of its Bureaus a Chief Data Officer with varying rank and scope, such
as a the CDO of Public Safety and Homeland Security; in total, the FCC created 11
CDOs. According to GoldenSource’s annual client survey, “over 60% of firms
surveyed are actively working towards creating specialized data stewards, and
eventually Chief Data Officers.”
5
Many organizations recognize that they need an executive who should lead
data management for the organization, but not necessarily a “CDO” by name. These
executives (a CDO equivalent) are assigned to take on full-time positions leading
enterprise-wide initiatives on data quality and analytics, data governance, data
architecture, and data strategy. We use “CDO” to refer to all executives who are
serving the CDO role at the enterprise level, even if they may not be formally assigned
the title “CDO” yet.
ReportingRelationship
As organizations attempt to use more advanced business analytics, often there
is a need to redirect the flow of information horizontally across the enterprise. Thus,
many of the CDOs and executives that we interviewed advocated for formal
organizational power to exert influence on company strategy. This power and
authority is often reflected in reporting relationships, membership on senior
management committees, and authority over budget and employment.
Of the CDOs that we interviewed in our study:
30 percent of the CDOs report directly to CEOs
20 percent to COO
18 percent to CFO
4
Company examples and discussions on managing information as product vs. by-product can
be found in Lee, Y., Pipino, L., Funk, J., and Wang. R., Journey to Date Quality, MIT Press,
2006.
5
Fernandez, T. “Chief Data Officers Becoming Crucial: Golden Source,” Securities
Technology Monitor, June 18, 2012.
http://www.securitiestechnologymonitor.com/news/GoldenSource-Chief-Data-Officers-30775-
1.html, accessed in December 8, 2012.
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Others report to the CIO, CTO, CMO (Chief Medical Officer), or CRMO (Chief Risk
Management Officer). Many CDOs are members of senior management committees
and have the authority to establish policies and strategies. Currently, the power and
authority of the CDO is evolving from data policy towards business strategy.
THETHREEDIMENSIONSOFTHECDO
In order to provide more structure and a better understanding of CDO roles, we
identified three key dimensions, as shown in Figure 1: (1) collaboration direction, (2)
data space, and (3) value impact. We describe each dimension below.
CDOROLES:
1Coordinator 2Reporter
3Architect 4Ambassador
5Analyst 6Marketer
7Developer 8Experimenter
Figure1:TheCDOCube RoleofChiefDataOfficer
Dimensions:CollaborationDirection(Inward/Outward),
DataSpace(TraditionalData/BigData),
ValueImpact(Service/Strategy)
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1CollaborationDirection:Inwardvs.Outward
The collaboration direction captures the focus of the CDO’s engagement, either
inside or outside of the organization. Collaborating inward means focusing on internal
business processes associated with internal business stakeholders. In contrast,
collaborating outward implies that the CDO’s focus is on stakeholders in the external
value chain and environment, such as customers, partners, suppliers, or non-profit
regulatory entities.
Initiatives led by internally-focused CDOs typically include developing data
quality assessment methods or mechanisms; cataloguing data products, sources, and
standards; creating processes for managing metadata or master data; engaging in
information product mapping; and establishing data governance structures. These
initiatives seek to deliver consistent data inside the organization and to address root
causes of various data quality issues. Streamlining the internal business process
associated with key data flows takes cross-functional cooperation, and it can yield
efficient and effective business operations. The CDO’s success in these initiatives
depends heavily on ability to effectively lead the relevant internal stakeholders and
map out the transformation journey.
In contrast, outwardly-focused CDOs strive to persuade and collaborate with
external partners. For example, an outwardly-focused CDO of a global manufacturing
company led a business process-embedded “global unique product identification”
initiative, geared towards improved collaboration with external global partners.
Outward CDOs may also focus on external report submission activities, particularly if
the company has experienced an external embarrassment or a sizable disaster, such as
being exposed by poor-quality reports.
2DataSpace:Traditionalvs.BigData
The data space that a CDO focuses on can either be transactional data,
typically in relational databases, or the newer and more diverse big data.
Many CDOs focus on traditional data, as it is the backbone of the
organization’s operation. Without a strong foundation in traditional data, an
organization’s most basic capabilities are hindered, and thus the need for a leader such
as a traditional data focused CDO arises.
In contrast, big data are usually not connected with the organization’s
transactional data or database systems, but offer innovative opportunities in further
improving operations or developing new business strategies based on new insights that
traditional data cannot provide. Big data CDOs provide the leadership to adapt to and
manage the analysis of this new, diverse type of data and the implementation of
insights from these analyses.
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3ValueImpact:Servicevs.Strategy
The CDO’s role can focus on improving services or on exploring new strategic
opportunities for an organization. This dimension reflects the impact desired from a
CDO. In many cases, the CDO role is a direct response to the on-going need for an
executive’s oversight and accountability to improve existing functions of the
organization. Increasingly, however, CDOs are sought who can add strategic value to
their organization by taking advantage of new tools such as data aggregators
6
or other
data products based on digital streaming data
7
. These CDOs are also exploring ways to
develop new market niches, or transform the company in order to develop smarter
products and services.
For example, one strategy-oriented CDO led an initiative to identify new
information products, advancing the company’s position in the financial industry. This
CDO led a cross-organizational collaboration initiative to create a strategic vision for
managing the new information products at the enterprise level. We have observed that
the CDOs who are positioned higher in terms of corporate rank are better suited for
taking on a strategy-oriented role.
CDOROLEPROFILES
We have identified eight different role profiles for a CDO based on the three
dimensions described above: collaboration direction, data space, and value impact.
These roles correspond to the eight corners of the CDO Cube depicted in Figure 1. For
convenience, we have assigned names to each of the corners, such as “Coordinator”
for the corner with Inward Collaboration Direction, Traditional Data space, and
Service Value Impact.
8
However, these names should not be taken too literally; they
are simply intended to be a short-hand notation for each of the corners. Each of the
eight roles is explained in more detail in the sections below.
It is important to note that, at any one time, a CDO may take on multiple roles.
However, a CDO inevitably has one primary role. Moreover, it is common for a CDO
to take on several different primary roles during his or her tenure as a CDO. Many
CDOs that we interviewed noted that their primary role evolutions were punctuated by
key initiatives or big changes in the environment or the broader marketplace.
6
Madnick, S. and Siegel, M., MISQE article, “Seizing the opportunity: exploiting web
aggregators”, MSQE, March 2002: 1,1pp 35-46 explains web aggregators and their strategic
business opportunities using publicly available internet data.
7
Picoli, G., and Pigni, F., “Harvesting External Data: The Potential of Digital Data Stream,”
MISQE, March 2013 (12:1), pp 53-64, explains new value-creating opportunities from digital
data streams. One of the five value archetypes is aggregation of digital data stream.
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Note that “Coordinator” is much shorter than saying “Inward Collaboration Direction,
Traditional Data space, and Service Value Impact.”
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1Coordinator:Inward/TraditionalData/Service:
The Coordinator CDO manages enterprise data resources and sets up a
framework that optimizes collaboration across internal business units (inward). This
allows for the delivery of high quality data to data consumers in the organization for
their business purposes, thereby improving business performance (service). The
Coordinator works with traditional data, such as customer information and other
transactional data (traditional data).
For example, the CDO at a US government agency identified common critical
data elements across the enterprise with which to set the foundation for data sharing
and integration at the agency level. The agency then led the identification of
authoritative sources for these critical data elements. This work on common data
elements set the stage for other data improvement initiatives. Part of this CDO’s
responsibility was to oversee the governance process for data management.
In another example, the CDO of a healthcare institution established data
governance councils and workgroups. She also led the group responsible for
enterprise-wide data quality assessment and improvement initiatives.
2.Reporter:Outward/TraditionalData/Service:
In heavily regulated industries, such as finance and healthcare, an emerging
trend in the CDO role is a focus on enterprise data to fulfill external reporting and
compliance requirements. Like the Coordinator, the Reporter CDO fulfills a business
obligation (service) through the delivery of consistent transactional data (traditional
data). However, the Reporter’s ultimate goal is high quality enterprise data service
delivery for external reporting purposes (outward).
For example, the CDO equivalent at a healthcare institution oversaw the
preparation of a selected set of data for regular reporting to the state government. She
worked closely with other corporate officers, such as the Chief Medical Officer and
Chief Financial Officer, as well as with external officials, to ensure that reports were
delivered in a timely manner and that they accurately and effectively represented the
activities of the institution.
Similarly, Reporter CDOs are often found in financial service organizations,
working with compliance or risk management groups to fulfill external reporting
requirements. Typically these CDOs are established when the company has
experienced difficulties in producing these reports, and often they play an important
role in integrating the data and information silos of recently merged companies, as is
required for external reporting purposes.
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3.Architect:Inward/TraditionalData/Strategy:
An Architect CDO’s direction and data space are the same as the Coordinator
CDO (inward, traditional), but the value impact is focused on using data or internal
business processes to develop new opportunities for the organization (strategy).
As an example, the CDO of a data company was responsible for establishing
an enterprise architecture that would yield value-added customer data products. Under
the CDO’s leadership, the company developed a blueprint that described the business
processes for delivering a new data product, the time required for each process, and the
individual responsible for each process. This blueprint, which we call their “map,”
9
was used to collaborate with the members of the organization on a daily basis. This
CDO recalled: “We made [the map] everybody’s map. Everyone knows their data role
in the company.” Suggestions for improvement to data products were also attached to
the “map.” This CDO reported that the “map” reduced time to market for new
products by 50%. In addition, the company produced better data products, and did so
before competitors could, thus gaining strategic advantage in the market.
4Ambassador:Outward/TraditionalData/Strategy:
An Ambassador CDO promotes the development of inter-enterprise data policy
for business strategy and external collaboration (outward, strategy) and focuses on
traditional data (traditional). For example, the CDO in a financial services institution
defined common datasets for risk management. He promoted a set of data standards
and data assessment measures for financial data exchange among peer financial
institutions.
As a second example, an international bank in South America went through a
strategic transformation that required significant process improvement and the
establishment of data governance mechanisms. During the transformation, the CDO,
reporting to the CFO, led a significant collaboration with other financial institutions to
improve data security for electronic international money transfer processes and
information exchange. This transformation was critical for the bank’s business strategy
and opened up opportunities to provide their customers with new services, which were
previously not possible due to data security weaknesses.
5Analyst:Inward/BigData/Service:
The Analyst CDO resembles the Coordinator, except that he or she focuses on
improving internal business performance by exploiting big data, thus requiring
different data management and data analysis capabilities. The need for an Analyst
CDO often emerges after an organization hires data analysts or data scientists but does
not designate an executive leader to provide an enterprise perspective to their efforts.
For example, a credit card company established a CDO who was responsible
for overseeing internal teams evaluating and analyzing big data, such as geo-tagged
data about credit card use and data from online customer surveys. This CDO
9
A pseudonym is used to denote the specific artifact at the request of the company.
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collaborated with the Chief Risk Management Officer, and provided the direction to
the data scientists. Subsequently, the company implemented enterprise-wide policies
to improve risk management and fraud detection.
6Marketer:Outward/BigData/Service:
The Marketer CDO develops relationships with external data partners and
stakeholders to improve externally provided data services using big data. CDOs in data
product companies are often Marketer CDOs. They develop working relationships
with retailers, financial institutions, and transportation companies that are purchasing
their company's data.
For example, the CDO of a data product company worked closely with the
company’s customers, in this case healthcare institutions, to help extract insights from
big data in the form of unstructured patient feedback data. The Marketer CDO led the
analysis of this data in order to identify ways to alleviate key weaknesses of the
healthcare institution. While few CDOs may currently claim this role, we observe that
the Marketer CDO is an emerging trend that is important for managing supply chain
partners and customers.
7Developer:Inward/BigData/Strategy:
The Developer CDO navigates and negotiates with internal enterprise divisions
in order to develop new opportunities for the organization to exploit big data.
For example, the CDO in a retail organization, acting as a Developer, worked
with the Chief Marketing Officer to find opportunities for new products and services
based on the mining of consumer behavior data from geo-tagging along with consumer
feedback data taken from social media sites. Using this vast source of information, the
Developer CDO developed a personalized marketing strategy for the company.
8Experimenter:Outward/BigData/Strategy:
The Experimenter CDO engages with external collaborators, such as suppliers
and industry peers, to explore new, unidentified markets and products based on
insights from big data. Through strong collaborative relationships across industries,
the Experimenter CDO maintains access to various sources of data and uses them for
creating new markets and identifying innovative strategies for organizational growth.
For example, the CDO of a financial institution experimented with developing
marketable information products for the broader financial industry and its prospective
clients. In preparation, the Experimenter CDO proposed the idea of creating new
information products by transforming, integrating, and reusing data from multiple
sources of consumer-generated data. More importantly, the CDO provided this new
product concept to the organization’s clients to gain their feedback. This Experimenter
CDO subsequently developed information products based on various data sources and
marketed them to client organizations. He argued: “We should be a revenue center, not
a cost center.” By taking advantage of insights from the organization's diverse data set
and guided by his knowledge of shared industry needs, this CDO expanded the
organization’s capability to conceive and experiment with new products, thus adding
strategic value.
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EVOLUTIONOFTHECDOROLE:AnExamplePath
Not all companies have the same needs and priorities, and thus the role of the
CDO differs from case to case. Furthermore, the role of the CDO can change as the
needs of the organization change.
Figure 2 depicts the role development of a healthcare CDO we studied for over
a decade. In this case, this CDO started with a focus on providing good service to
external recipients of traditional data. Gradually the CDO's role took on a more
strategic focus, both internally and externally, and presently she is concerned with
exploiting big data. Over a ten year period, this CDO’s role evolved from Reporter
(role #2), to Coordinator (role #1), to Architect (role #3), to Ambassador (role #4) and
now to Developer (role #7). Below, we briefly discuss the CDO’s role over time, and
explain: (1) what triggered or prompted the CDO to transition to a subsequent new
role; (2) why that role was chosen; and (3) what was accomplished by carrying out the
new role.
Figure2:ExampleRoleProfileandPath
1Coordinator2Reporter
3Architect4Ambassador
5Analyst6Marketer
7Developer8Experimenter
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Sequence of an Example CDO’s Primary Roles
Reporter CDO (Role #2): At the start of this journey, the CDO, acting as a
“Reporter,” oversaw the provision of data to state regulators, especially regarding
reimbursements since these were essential to the business. This was a challenge
because the data, generated internally from the hospital’s operations, often was not
ready for external reporting purposes. There were multiple sources of the same or
similar data, producing inconsistent results. Several data sources were not trusted
by internal data consumers, and thus some groups in the organization were
reluctant to release that data for external purposes without further review. Every
time there was a need for external reporting, the CDO had to go through all of the
data, cleaning it up and preparing it for external submission.
Coordinator CDO (Role #1): After being fined for submitting poor-quality data to
the state government, the hospital realized that, in order to report good quality data
externally, it needed to turn its attention to internal data quality. Given a mandate
from the CEO to improve the quality of organizational data, the CDO transitioned
from being just a “Reporter” to being a “Coordinator” as well. She established an
enterprise-wide data quality improvement framework, coordinating across
functional business units to systematically address the “cleaning up and preparing
the data for submission.” In addition, she developed procedures to assess data
quality techniques periodically and established enterprise-wide data problem
identification and resolution dashboards. Internal data consumers subsequently felt
they could trust their data sources, and the external reporting process was also
streamlined.
Architect CDO (Role #3): Having successfully improved organizational data both
for internal and external services, the CDO realized that there should be a
sustainable structure and capability for data practice. This realization triggered the
CDO to fill the gap of sustainability by strengthening the alignment of data
practices with business processes by people, changing focus from service to
strategy and assuming the role of “Architect”. In this role she established
governance for data quality as well as standards committees and working groups.
She also established and maintained an enterprise level data quality problem-
solving process and aligned business roles with data roles for all members of the
organization. She implemented a policy for each member of the organization to
have a specific data role, such as a data collector, data custodian, or a data
consumer, in addition to a business role, thus strengthening the business-data
alignment. In order to reinforce the importance of data roles, each member’s
contribution to the quality of enterprise data was factored into their annual bonus.
Ambassador CDO (Role #4): Increased pressure from insurance companies for
comparable measurements required that the CDO improve collaboration between
institutions. The CDO thus became an “Ambassador,” engaging in industry
benchmarking and the establishment of shared data practices through a consortium
and various forums. She participated in setting the industry's data roadmap,
organizing and training other data practitioners and collaborating with other
instutions to promote data quality across all other hospitals. Through these efforts,
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the CDO transformed standards setting for business processes and for various
healthcare industry indices.
Developer CDO (Role #7): The hospital eventually reached a plateau in
performance from the use of its internal data. Consequently, the CDO took on the
role of “Developer”, exploring the use of big data generated by patients in order to
improve hospital performance. In particular, she focused on developing various
methods for analyzing unstructured patient feedback data in order to identify
specific factors associated with poor performance. These analyses included data
mining techniques such as sensitivity analysis. In combination with analysis of
standard numerical assessments, such as the Hospital Consumer Assessment of
Healthcare Providers and Systems report, the methods that the CDO developed led
to actionable recommendations for doctors, nurses, and other units within the
hospital. In further pursuing such opportunities, the CDO is currently developing
new measurements to provide more tailored feedback to the clinical team for
improving patient care and safety.
MAKINGTHECDOCUBEACTIONABLE
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The Cubic Framework can be used to identify focused roles of a CDO, a key to
successful data practice. Below we provide a pragmatic three step guide, based on the
Cubic Framework. The three steps, listed below, are Assess, Determine, and Strategize.
We briefly list the steps here, followed by further elaboration.
1. Assess current status of your organization’s data-related business practices
(based on the three dimensions of the CDO Cube).
2. Determine the CDO role profile needed for your organization (based on the
eight roles described), and whether an executive-level CDO is required to
fulfill these needs.
3. Strategize the likely path for the CDO based on a projection of organizational
future needs
Step1:Assesscurrentstatusofyourorganization
Assessment of the current status of your organization will help to highlight
weaknesses your organization should focus on. The CDO Cube provides a framework
with which an organization can identify their current needs with respect to
collaboration direction (inward vs. outward), data space (traditional data vs. big data),
and value impact (service vs. strategy).
In Table 1, we provide twelve assessment questions based on the cubic
framework. Specifically, questions 1-4 deal with collaboration direction; questions 5-8
address data space; and questions 9-12 investigate value impact. To further
10
The authors benefited greatly from the advice, discussion and input from the MISQE
workshop in December 15, 2012, in Orlando, Florida.
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demonstrate the assessment process, we have also included sample responses in the
two rightmost columns.
Note that most organizations have needs that apply to every corner of the CDO
Cube; these assessment questions will help to prioritize which roles (e.g., corners of
cube) are most critical. These assessment questions are also an excellent opportunity to
engage many members of the organization from cross-functional business units on all
levels. The varied perspectives will strengthen CDO discussions, and in the case that a
CDO is established, it can be done so with organizational-wide endorsement.
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Table 1:
CollaborationDimension:Inwardvs.Outward
Highscorefor#1and#2impliesinwarddirection.
Highscorefor#3and#4impliesoutwarddirection.
Assessment
Score(17)
1Strongly
disagree
4Neutral
7Strongly
agree
Assessmentdiscussion
notes
Whysection:explain
reasonforAssessment
1. It is critical that our organization uses data
effectively for internal business operations.
3
We do this well, thus, not
critical at this point.
2. Our company has the opportunity to significantly
improve internal operations.
3
Maintain what we do well.
3. It is critical that our organization collaborates
with other value chain enterprises, such as
suppliers, customers, distributors, or competitors.
6
We need to know our
suppliers and customers
much better.
4. Our organization’s success is critically
interlocked with other companies, market
changes, external situations or environments.
7
Our procurement can be
vastly improved with better
understanding our suppliers.
DataSpaceDimension:TraditionalDatavs.BigData
Highscorefor#5and#6impliestraditionaldata;Highscorefor#7and#8impliesBigData.
5. Our organization’s transactional data should be
more effectively used to address the enterprise’s
needs
6
We need to know more about
aggregated amounts of
materials for different
suppliers.
6. It is critical for our organization to use the
transactional data in an integrated fashion across
different business areas.
7
To negotiate with our
suppliers, we need to get all
divisions to use the
information we have already
in a consistent way.
7. Our company needs to identify opportunities for
using big data and data analytics.
5
We may not be there yet to go
for this direction.
8. It is critical for our organization to understand
external sources of data, such as social media for
engaging customers.
6
Our customers might be
ready for new sources in the
future and we need to explore
and exploit social media.
ValueImpactDimension:Servicevs.Strategy
Highscorefor#9and#10impliesService;Highscorefor#11and#12impliesStrategy.
9. Our organization’s data efforts should be largely
initiated or requested by the enterprise’s business
units.
4
We do this well.
10. It is critical for our organization to improve the
efficiency of the data service for operation.
5
We can still improve, but we
do well on serving data for
the internal business units.
11. Our organization’s data efforts should be largely
initiated by the need for changes in the way we do
business.
6
We can use the data for
changing the way we do
procurement planning with
our global suppliers.
12. Our organization must achieve its strategic
business goals with better data.
7
We must figure out who our
best business customers are
and set different strategies for
different customers.
Forthcoming,MISQuarterlyExecutive,Leeetal.2014
16
Table 1 can be used both quantitatively and qualitatively. A simple
quantitative analysis can be accomplished by assigning a score (on a 7-point scale) for
each response. Comparing the sum of the first 2 scores and the last 2 scores for each
dimension will reveal a bias in each dimensional space. For example, question 1 and 2
(emphasizing inward) may have scores of 3 and 3, respectively, and question 3 and 4
(emphasizing outward) may have scores of 6 and 7. The sum of questions 1 and 2
(3+3=6) is less than the sum of questions 3 and 4 (6+7=13), suggesting that
collaborating inward is less critical than collaborating outward. This same process can
be repeated with questions 5-8 to determine a focus on traditional vs. big data, and
questions 9-12 to determine a focus on service vs. strategy. Taken together, these
computations will identify a single, most critical CDO role.
A qualitative analysis can be accomplished by explaining the “why” in the
“Assessment Discussion Notes” column for each of the questions . This helps to
determine the criticality of each dimensional direction. The examples shown in the
rightmost columns of Table 1 are very terse; more comprehensive notes could be used
to further elaborate.
Step 2: Determine whether a CDO is needed
Based on the initial assessment, an organization can then tackle Step 2, which is
to determine the CDO role profile needed and whether an executive-level CDO is
required to fulfill these needs. Note that it may take considerable discussion before an
organization can decide which roles are most important; the scores from Step 1 should
not be taken as an immediate solution. Rather, the assessment questions should be
used as a tool to initiate conversations among members of the organization on data
practice and the implications for the organization’s overall performance.
Establishing a new CDO requires serious consideration because it implicates a
change in resource allocation and reporting relationship. Therefore, before creating a
CDO position, an organization should review the effectiveness of other data practice
mechanisms, such as governance committees, workgroups, data and business process
conflict resolution mechanisms. On the other hand, often data practice initiatives alone,
without assigned accountability, do not yield effective results.
Additionally, in some cases, organizations may already have leaders who can
take on the role, or parts of the role, of a CDO. For example, the CFO may be able to
take on the work which Step 1 Assessment would assign to a Reporter CDO or
Coordinator CDO, in which case focus on traditional data and service may not be as
critical as the assessment numbers suggest. We have also seen cases where the CMO
has taken on the role of a Developer CDO or Experimenter CDO role. These are
instances of effective collaboration amongst senior executives, in which case
establishing a separate CDO may not be necessary. More often, however, such
collaboration efforts among executives can be short-lived and ad hoc. If so, there is
need for sustainable leadership made possible by a CDO..
Forthcoming,MISQuarterlyExecutive,Leeetal.2014
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Step 3: Strategize the CDO transitional path
The step of strategizing for future needs can be broken down into two
processes. First, the organization should create a projected timeline for addressing the
needs discussed in steps 1 and 2. For example, as illustrated in the right-most columns
of Table 1, during steps 1 and 2, an organization might determine that the most needed
CDO role profile is that of an Ambassador (outward, traditional, strategy). In this
situation, the organization may propose an 18-month plan to closely align data practice
with business processes.
Second, based on quantitative and qualitative measures, the organization can
determine how crucial other roles in the Cubic Framework are relative to the primary
role assigned. Alternatively, the organization may determine that there are no other
highly critical needs which must be addressed at this time. In either case, based on the
projected timeline the organization can either determine that the planned CDO will
need to transition from one role to another or it can decide to reassess organizational
needs by repeating steps 1 and 2 in the future.
In the example from Table 1, further analysis may suggest that big data
demands are almost as critical as the traditional data needs which the future
Ambassador CDO plans to address (e.g. summed score 13 vs. 11). The organization
could plan for the CDO to transition from Ambassador CDO to Experimenter CDO
(outward, big data, strategy) at the end of the 18 months in order to address external
needs.
An implicit, yet key strength of the three-step process is that it is a collective
endeavor which engages all cross-functional business units. Enterprise support and
approval for the establishment of a CDO lays the groundwork for the CDO to be an
effective leader.
CONCLUDINGCOMMENTS
As an organization's strategies for achieving success become increasingly
dependent on data, organizations must position themselves to harness the value of
data. To this end, establishing a CDO has been an emerging trend in industry and
government. Soon, more and more organizations will need to exploit the critical value
that the CDO can provide. We present the CDO Cube framework to provide a guide
for those organizations to help analyze the need for a CDO and the profile for the
CDO, along the three dimensions that we have identified.
