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Chief Digital Officer (CDO) The What’s and Who’s

Digital transformations don’t happen all by themselves. Over the past decade as digitization of the enterprise has taken hold a new C-Level role has been appearing, the Chief Digital Officer.

The term “Chief Digital Officer” (CDO) started gaining traction in the early 2010s. According to Gartner, a leading research and advisory company, the CDO role was predicted to become a “hot executive title” by 2012, and they forecasted that by 2015, 25% of organizations would have a CDO. As is often the case, adoption predictions take longer to materialize than is thought. According to research from PwC, about 21% of large public firms now have a CDO. A little short of the 25% number predicted for 2015 but still a significant presence in the board room.

CDO’s play a crucial role in modern organizations, spearheading digital transformation efforts essential for businesses to remain competitive in today’s fast-paced, technology-driven world. The importance of the CDO lies in their ability to integrate digital technologies into every aspect of a company’s operations, driving enhanced efficiency, improving customer experiences, and unlocking new revenue streams.

What does a CDO do? CDO Role and Value

Driving Digital Transformation: At the heart of the CDO’s role is the responsibility to drive digital transformation across the organization. This involves not just implementing innovative technologies, but also rethinking and redesigning business processes to use digital capabilities fully. This transformation is essential for companies to stay relevant in an increasingly digital economy, where traditional business models are continually being disrupted by innovative digital solutions.

Enhancing Customer Experience: The CDO is tasked with improving the customer journey by using digital tools to provide seamless, personalized experiences. In a world where customer expectations are at an all-time high, businesses must deliver consistent, high-quality interactions across all digital touchpoints. The CDO ensures that the organization is equipped to meet these expectations by integrating customer data, leveraging artificial intelligence, and employing user-friendly digital interfaces.

Optimizing Operations: Digital transformation is not just about customer-facing changes; it also involves refining internal operations. The CDO works to streamline workflows, reduce inefficiencies, and improve decision-making through data analytics and automation. This can lead to significant cost savings and enhanced productivity, providing the company with a competitive edge.

Fostering Innovation: A critical aspect of the CDO’s role is to foster a culture of innovation within the organization. This involves encouraging experimentation with modern technologies, supporting digital initiatives, and promoting a mindset of continuous improvement. By driving innovation, the CDO helps the organization to stay ahead of technological trends and respond quickly to market changes.

Ensuring Cybersecurity: As businesses become more digitally integrated, the risk of cyber threats increases. The CDO handles implementing robust cybersecurity measures to protect the organization’s data and digital assets. This includes ensuring compliance with data protection regulations and fostering a culture of security awareness among employees.

What does a CDO look like? Typical Profile

Technological Smarts: A successful CDO must have a deep understanding of various digital technologies, including cloud computing, artificial intelligence, data analytics, and cybersecurity. This technical knowledge allows them to find and implement the right digital solutions for the organization.

Strategic Vision: The CDO should have a strong strategic vision to drive the digital agenda. This involves understanding the broader business context and aligning digital initiatives with the company’s overall goals. The ability to think long-term and anticipate future technological trends is crucial.

Leadership Skills: Effective leadership skills are essential for a CDO, as they must inspire and motivate the organization to embrace digital change. This includes leading cross-functional teams, managing resistance to change, and fostering a collaborative environment.

Business Acumen: The CDO needs a solid grasp of business fundamentals to ensure that digital initiatives deliver tangible business value. This includes understanding key performance indicators, financial metrics, and market dynamics.

Change Management: Driving digital transformation often involves significant organizational change. The CDO must be adept at managing this change, including communicating the benefits of digital initiatives, training employees, and ensuring a smooth transition.

Final Thoughts

The role of the Chief Digital Officer is pivotal in navigating the complexities of the digital age. By driving digital transformation, enhancing customer experiences, optimizing operations, fostering innovation, and ensuring cybersecurity, the CDO helps organizations to thrive in an ever-evolving technological landscape. What I find interesting is that in collaborating with my clients over the past decade since the inception of the CDO title I’ve never run into that role in any of my clients. It’s most often a project specific role that fills that space working with the C-Suite versus being a member of it. I’m looking forward to seeing the continued expansion of the role in all organizations over the next few years.

November 13, 2024 Posted by | Uncategorized | , , , , | Leave a comment

Digital Transformation:Erecting the House

The Challenge

In my last installment I discussed building the foundation for Digital Transformation.  It’s time to erect that digital house on the strong foundation of business alignment that’s been poured and the clean-up of software debris completed. Adoption of new tools and processes always, and I mean always, represent the highest hurdles any enterprise must overcome to achieve digital transformation. Just a reminder that 38% of spend on these projects DO NOT mee their ROI objectives. So, 38 dollars or every 100 spent gets flushed into oblivion. In my experience that number is often higher but unrecorded.

Focus on Adoption

In my neighborhood a home built in the 1980’s has been undergoing a massive renovation, it’s been nearly 2 years since the whole process started. We were all very glad to see the changes, at first. To say that the neighbors are over-it is an understatement. Trucks everywhere blocking the street, a never-ending stream of contractors, noise and distraction have made all of us less than excited about the outcome, we just want it OVER! It’s the same phenomenon with digital transformation projects, employees see the value when the work begins but over time if the distraction of the change overshadows the intended outcome interest wanes and resistance builds. Consider that on any given day over 60% of employees are frustrated by new technology implementations. Successful digital transformation efforts understand this challenge and plan to reduce the risk.

Adoption Critical Success Factors

  • Modernize Processes
    • Redesign the business processes impacted by the change BEFORE implementing the digital tools. Never hope that the technology will change the processes by default.
    • Work closely with key influencers in the process areas impacted to understand the work and build confidence that the technology improvements with make their lives easier and more productive.
    • Memorialize the modernized processes on paper. Yes, on paper. Despite the notion that no one reads paper, employees want to see their new processes in front of them to understand, review and provide feedback.
  • Design a Unified User Experience
    • One password, one landing page, a unified experience that allows employees easy access to the new technology experience.  There is no bigger mistake than to add passwords and landing pages to the already overloaded technology stack.
    • Unified experiences that clearly mechanize the modernized processes give users the confidence needed to dive in and build competency. Forcing users to navigate new paths on top of old paths will make time to value increase significantly.
  • Engage, Engage, Engage
    • Introducing digitally transformed processes requires time and effort in engagement with the impacted employees. Build that time into the roll-out calendar. Shorting the initial adoption period is the biggest miss I see most often.
    • Ensure senior leadership and process influencer involvement early and often.
    • Focus on the WIIFMs (What’s In It For Me) value in every conversation. Users really don’t care much about the “bigger picture” value the digitization will produce; they focus on how it helps them do their job faster and easier. Unless everyone in the business owns stock in the company shareholder value is a poor WIIFM.
  • Measure Adoption Religiously
    • Observe usage regularly. Regularly depends on the process being performed some processes occur daily, others monthly or even less often, build a measurement scheme that takes these periods into account.
    • Digital observation is only one way to measure adoption, it’s often the least reliable method. Digital monitoring will only provide a signal that adoption is weak, physical observation and measurement offers stronger data to assist users in adoption.
  • Recognize Early Adopters
    • Positive reinforcement of early adoption through highlighting success stories builds momentum for the changes implemented.
    • Publicize stories about how customers are served more quickly and accurately than ever before or any other positive outcomes from early adopters.

Closing Thoughts

Digital transformation with embedded artificial intelligence is underway across the business community. Massive investment in digital technologies only produces the desired outcomes when these technologies become institutionalized as leading practice in your business. Be mindful of the positive steps you can take to reduce the risk of failure by planning carefully and executing flawlessly.

November 6, 2024 Posted by | Uncategorized | , , , , | Leave a comment

Digital Transformation: Real or Marketing Jargon?

Digital transformation—it sounds like the latest buzzword cooked up in a marketing lab, doesn’t it? But when you peel back the layers, you realize it’s far more substantive than flashy jargon. Let’s dig in.

A Little History

In my career I’ve been fortunate to grow and change at the pace of technology. In college I used a typewriter and carbon paper to author assignments and punch cards to program mainframes. So, I get the whole digital transformation thing deeply. But hasn’t it been going on since the mid-20th century? Understanding the contemporary version of digital transformation demands a look at history. The transition from analog to digital processes has been happening for decades. From the introduction of computers in the workplace to the rise of the internet, the shifts have been profound and continuous.

Take the Industrial Revolution, for instance. It was a period of tremendous change, with new machinery and technologies altering the way work was done. Similarly, the advent of computers in the mid-20th century marked the beginning of a new era. Businesses began to automate tasks that were previously manual, leading to increased efficiency and productivity.

Digital Transformation Evolution

The term “digital transformation” itself might feel new, but the concept is rooted in these historical shifts. Today, it refers to integrating digital technology into all areas of a business, fundamentally changing how you operate and deliver value to customers. This transformation is driven by the rapid advancement of technology and ever-increasing customer expectations.

In the 1990s, the rise of the internet brought about the first wave of contemporary digital transformation. Companies began to create websites, explore e-commerce, and digitize some of their operations. Some of us have scars to show from these early experiments where the website was the only digital part. Orders or inquiries may have been posted to the website but behind the scenes it was “rip and read” where we would rip the paper from the printer and read the internet result then manually execute the rest of the process. The early 2000s saw the rise of social media and smartphones, further pushing businesses to adapt. The current wave of digital transformation goes beyond mere digitization—it’s about rethinking and reimagining how businesses function in a digitally-driven world.

Not Just Marketing Hype

So, is digital transformation just marketing language? The evidence suggests otherwise. True digital transformation involves significant changes to business processes, culture, and customer experiences. It’s not about slapping a digital interface on an old process; it’s about fundamentally rethinking how to use technology to drive growth and efficiency.

Real-World Impact

Consider companies like Netflix and Amazon. Netflix started as a DVD rental service but transformed itself into a streaming giant by embracing digital technologies. Amazon, once an online bookstore, now dominates e-commerce and cloud computing thanks to its relentless focus on innovation and technology.

In manufacturing, digital transformation is manifesting as the Industrial Internet of Things (IIoT), where machines communicate with each other to optimize production, and digital twins allow virtual simulations of supply chain automation. In healthcare, digital transformation means better patient engagement through electronic health records and telemedicine.

Final Thoughts

Digital transformation isn’t just a shiny new term invented by marketers. It’s a continuing evolution that requires businesses to integrate digital technologies at their core. It’s about embracing the future while learning from the past. While the term may be relatively new, the concept is deeply rooted in the historical progression of technological innovation. So next time you hear the phrase, know that it’s more than just a buzzword—it represents today’s challenges and the future of business.

Over the next few weeks, I’ll be sharing tips and tricks to aid in the identification and adoption of digital technologies that drive transformations efforts.

October 23, 2024 Posted by | Uncategorized | , , , , | Leave a comment

Customer Focused Change…Do it!

Nearly every survey done over the past 30-some-odd years asking about why large scale technology or process improvement projects fail indicates a weakness in change management. Hmmm..Isn’t that interesting. A recurring failure point. Why?  Why is managing change such a challenge?  In my mind and experience the answer is quite simple. A weak connection to the change’s impact on customers.

Every process improvement guru focuses on understanding customer wants, needs and perceptions before embarking on any business intervention. Improve efficiency, implement new technologies, bring a new product to market, change pricing and packaging, you name the change it should always be underpinned by driving customer retention and/or acquisition. Yet, when I walk into a client situation and ask a simple question about customer metrics the change will impact, I get blank stares. When I ask a Six Sigma Black Belt what the CTQ’s (Critical to Quality) are that made this effort important I get the same result, a thousand-mile stare. And we wonder why employees don’t adopt new practices or technology.

In my earliest interactions with any client the customer is always a topic. How will this change impact the customer’s wants, needs and perceptions? Will it make you easier to do business with? Will your employees be engaged with the change because they know how it will affect customer satisfaction?  Very few clients can answer these questions. Very few consultants working on the change can answer these questions. Hence, all the communication and training in the world won’t make adoption happen or the change stick.

CUSTOMER FOCUSED CHANGE: A PRIMER

DEFINITION: Customer-focused change is a strategic approach where businesses prioritize the needs and experiences of their customers in every aspect of their operations. This involves a shift from product-centric to customer-centric thinking, where the ultimate goal is to enhance customer satisfaction, loyalty, and advocacy.

Imagine!! Putting the folks that pay the bills at the center of the universe. What a strange concept.

A FEW TIPS

Here are some tips on exercising customer-focused change:

Understand Customer Needs: Understand clearly the wants, needs and perceptions of your customers.

Align with Customer Success: If you want a sticky change align your success with that of your customers, ensuring that all facets of the change prioritize the impact on customer wants, needs and perceptions. Don’t be fooled by thinking you know what the impact will be, know if well enough to measure against. 

One of my favorite stories is about a client I worked with to improve their ease of doing business by implementing a new ERP solution. On a customer visit we asked what would make their experience better with the client.  The answer was both hilarious and sad. “If we knew before the FedEx truck drove past the dock we weren’t getting our shipment today.” That’s big. We turned that story into a primary message for the change.  Making sure the investment in time and money wasn’t focused on just hitting a go-live date but on giving that customer and others transparency to their order status.

Prioritize Customer Feedback: Take all customer feedback seriously. Make decisions with that feedback in mind. One of my clients painted on the wall of their main conference room these words: “How will this impact our customers?” At every meeting about the change project the leadership team would point to that question when being asked to decide on a modification to the project.   

Operationalize Customer Empathy: Make it real! Implement practices that operationalize empathy towards customers. Add technology where appropriate to aid in understanding and meeting their needs more effectively. Change should not be just about reducing costs, which it often is, but about reducing operating costs while improving the customer experience.

Engage Employees: Link the change message internally to customer outcomes. Employees really do care about their customers, they want to know how this change will make customers more loyal to the brand and keep their jobs safe.

Exercising customer-focused change, may require businesses to adjust change strategies, processes, and even their organizational structure to ensure that customer needs are at the forefront of decision-making.

Put customers at the center of any change and watch the success rate of adoption increase dramatically.

June 20, 2024 Posted by | Uncategorized | , , , , | Leave a comment