Hi and welcome to chapter 2 of the CDO blog post series.
In the first blog post of a series, I outlined the necessity of the chief digital officer. Digital technology is both – it can be a huge chance if you have the understanding of its power and possibilities. And it will be a threat to your company if you fail to run the transformation. This huge responsibility needs to be taken by a chief digital officer. In this blog post, I dig into the main tasks of his work and the key aspects of his personality. I also outline the necessary leadership capabilities of such a personality. Let´s go discovering the #CDO 😉
First, I´d like to start with the foundation. As the headline is “digization” of the business model, we build the CDO around this.
- Development of the digital vision and strategy aligned to current and future business models as well as the existing business vision and strategy.
- Definition of underlying principles of the digital transformation (such as “user experience” for example)
- Setup of a consistent approach of the digital transformation (e.g. learning-cycles, prototyping etc.)
- Creation and further development of the digital roadmap (may also contain “products”)
- Creation of internal organization of the transformation as well as an internal core-team dedicated to this whole stuff.
There are the following premises:
- Your CEO fully understood the need for change and is able/willing to go new ways.
- The entire C-suite is supporting the upcoming transformation and understands, that this will be a wild ride for 5-10 years.
Now let´s dive a little bit deeper into every point and understand the core tasks and challenges in there.
A vision is a kind of target-picture that is far away in the future. It is challenging, motivating and the source of all activity of the company. If the vision is developed together with the staff, an awesome commitment is the price. The CDO must be able understand the business context of both todays and tomorrows business in order to work-out a vision for the digital era.
After formulating the vision, the next step is to think of the next 2 to 4 years in the perspective of strategic maneuvers. What do the stakeholders say? What are future trends? What is the perspective of markets and customers? Strategy does not mean a long-term plan. Today in the fast changing world a strategy is giving a true north for the next 2 to 4 years.
Definition of underlying principles
Principles only work when they are applied without exception – if done so, they are a core asset in the digital transformation. If selected well and applied correctly, they can even support the evolution of the company culture.
Setup of a consistent approach
This is indeed a difficult task, because there is no blueprint. How to run a digital transformation of a company depends from size, maturity, culture, business and so on. The transformation is highly complex because there is no “single screw” to turn. Every screw you turn affects other screws. You work in a system and that is why a transformation cannot be piloted or tested. Do it or leave it.
Creation of the digital roadmap
So now you have a vision, a strategy, key principles and an idea of an approach. Next big task: Define your roadmap. What will be your first activity? Which one next? Are they interlinked? Where is the customer? The roadmap is basis for the financial planning as well as all further communication activities.
Creation of internal organization
The digital era does not work with stand-alone heroes. As every business is a network, a CDO needs to be able to build up networks inside and outside the company. For this (and all the other work that needs to be done) he runs his own team of experts. This team should contain 50% of externally hired people.
Looking on all those tasks, they are not small ones. Well there is a reason for the “C” in the CDO. How to setup the CDO I will outline in my third blog post of this series.
Now let´s have a look on the personality. These are the must-haves of any CDO:
Digital technology develops very fast. The CDO needs to be able to envision the possible developments and abstract those towards business impact. The CDO also needs to be aware of the development of societies and influence on workforce. He needs to be able to detect weak signals.
Leading in change
A CDO is also a kind of digital “evangelist” able to drive the change by motivating and encouraging for new structures, practises, processes and technologies. A quite short sentence for a huge task. There are not many things more challenging in business than driving a change.
A CDO also has to run very practical managing work. Checking budgets, planning the workforce, giving structure and enforcing key rules are some important tasks of the CDO.
A business is a complex system. It is not necessary to understand every detail. But it is a prerequisite that the CDO is able for systemic thinking and understands the interlinking of technology, core processes, culture, strategy and assets as well as stakeholders and customers.
Broad knowledge and understanding
A business transformation driven by digital technology and surrounding impacts. This is the core. That means that the CDO needs to have a deep understanding of digital technology, business structures, future developments and trends, both leading and managing skills. On top of this, the CDO also experienced new working models such as iterative working (e.g. scrum). He is able to lead in change and make large networks follow his vision and strategy. In other words, the CDO needs a very broad groundwork in knowledge and understanding.
Summary: The CDO is a personality being able for multi-focal work and strong abilities to work with networks. The CDO needs a broad knowledge base as well as strategic skills. The perfect candidate knows both worlds: The traditional management setup as well as “start-up-like”-work and is able to build bridges (and to be honest, this might be a rare species today!).
Looking on all those requirements it is clear that there is a strong interplay with the CEO and the other C-roles in the board of management. There are several ideas how to setup the #CDO. In my next blog post in the CDO-series, I will compare the most important scenarios and do a strength and weakness analysis. So, hopefully see you soon again in chapter 3, the “how” to setup a CDO in a company.