It has become increasingly apparent over the last few years just how fundamental data and analytics is to business success. As a result, the demand for data leaders within a company to drive and spearhead its data strategy has intensified.

For the most forward-thinking companies, that means hiring a Chief Data Officer (CDO). From data governance and compliance to influencing overall business strategy, the CDO is an expert and specialist in translating and delivering real value from data.

With that in mind, it’s no surprise that 65% of companies now have a permanent CDO in place, rising from 12% just under a decade ago in 2012.

Despite this, there is still a lot of confusion and uncertainty about the CDO role, specifically in terms of defining exactly what it covers and how it is perceived by others. MIT Sloan research suggests that the CDO is properly established in less than a third (30%) of organisations.

But why is that? In order to find out, we surveyed 250 active CDOs from across the UK, the US and Germany to provide clarity around this newly established role and to offer organisations with practical advice on how they can make their CDO hires a success.

Getting to grips with the CDO role

The CDO is responsible for leading and building a data strategy that supports the wider business strategy and objectives.

“The chief data officer needs to demonstrate the value of data, treating data as an asset, building data literacy and making sure better decisions are being made due to better insight and intelligence,” said Abel Aboh, Data Management Lead at the Bank of England and a participant at the CDO Summer School run by data expert Caroline Carruthers and myself.

The CDOs that get this right can produce remarkable results. Moreover, according to research from Gartner, “They are also 2.3 times more likely to be effective at reducing time to market and 3.5 times more likely to be effective at data monetisation.”

However, as Abel points out, getting to this point isn’t always easy: “You’ve got to have a bit of maturity in an organisation…if not, then you can see the passion of the CDO go out of the window — and they will ultimately leave.”

This is due to a handful of common pitfalls:

• It’s a poorly defined role: half (50%) of the CDOs we spoke to believe the value of the role is not yet recognised in the business world and 46% agree that their organisation’s expectations for the role are too high and misinformed. They typically have multiple responsibilities to fulfil, often with little consensus as to their priority.
• There’s a culture clash: it has been argued that culture is often the greatest barrier to data success, and that certainly seems to be the case from our findings. We found 42% of the CDOs said they face a resistance to change within their organisation, with over a third (37%) pinning the blame on a lack of C-suite buy in. Over half (51%) also agree that C-Suite / senior management aren’t willing to embrace the level of change required to become a data-driven business.
• Being held back by tech: CDOs are also commonly held back by their infrastructure. Almost half (48%) of CDOs said they are held back by legacy applications and 46% say outdated data management infrastructures; scale and data volumes are a problem. Outdated technology systems are often the biggest barriers to data liberation too. Breaking these down to achieve data democratisation is crucial, but not always possible if the CDO has little control over budgets.
• Poor data literacy: to top it all off, a lack of data literacy is proving to be a significant roadblock to success, with 38% of the CDOs saying they face poor data literacy across the organisation and almost half (45%) saying there’s a lack of relevant data skills across the organisation. This is worrying especially since the ability to effectively communicate insights from data has never been so important.

Considering all of these challenges, it’s perhaps not surprising that CDOs have incredibly short tenures. 1 in 5 (17%) of the CDOs we spoke to have only lasted one or two years, the majority (30%) between three and five years, and just a quarter (24%) stayed over five years. Some research suggests this is far lower than other C-suite roles.

Overcoming the barriers: top tips on making CDO hires a success

That said, there are ways organisations can overcome these problems and enable CDOs to flourish in their roles. Here are my top tips:

1. Understand the CDO role before head-hunting: it’s important that senior leaders are educated about what the CDO role should entail, and the value the role can bring to their organisation.It’s no longer about simply governing data – it’s about liberating it. Working with the CDOs to set real expectations around this, along with achievable goals, means that organisations will be better placed for success.
2. Invest in the right tech stack: create the right environment and infrastructure in which CDOs can thrive. On top of that, organisations should take the time to invest in the right technologies that will allow them to break down silos and democratise data. Identifying the businesses’ current analytics maturityis a good place to start.
3. Consider applicants from non-technical backgrounds: there’s huge value in hiring from diverse, non-technical backgrounds. Experience in roles such as HR, marketing and the arts can bring a lot to the position. The best data scientist that I ever managed didn’t have a traditional science background, but a degree in Philosophy from the University of Warwick. He was creative and curious, capable of turning insights from data into compelling arguments and stories.

Considering the incredible potential value that data holds for businesses today, brave data leadership is now more important than ever. At a time when data-driven companies consistently outperform their peers, a strong CDO can make the difference between success and failure.

But even the very best CDOs cannot perform if they are held back by challenges. The solution is to talk and be open to change. Regular, honest dialogue between CDOs and their employers, or future employers, is crucial to ensure the right measures are in place that enable them to do the best job they can and unleash the full potential of data and analytics within an organisation.

Peter Jackson is Chief Data and Analytics Officer at Exasol.