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April 26, 2023
ONE PAGE SUMMARY
As the use of data, analytics, and AI becomes a board-level concern, more companies are creating new C-suite roles to oversee these areas, including Chief Data Officer (CDO), Chief Data and Analytics Officer (CDAO), and Chief AI Officer.
- These new roles allow boards to have a single point of contact with specialized expertise on topics that draw regulatory and investor scrutiny.
- However, creating these roles can also lead to tension with other C-suite leaders, confusion over responsibilities, and disappointment from business counterparts who expect fast results.
- Companies are encouraging collaboration and clear expectations and visions for these roles.
- Successful CDOs drive change in their organizations, helping teams use data for forward-looking prescriptive and predictive analytics.
DEEP DIVE
CIOs, Meet Your New Colleagues: Chief Data, Analytics and AI Officers
Collaboration is key as more companies hive off duties held by IT officers and create positions to better use data and manage emerging tech like ChatGPT
Wall Street Journal
By Isabelle Bousquette
April 14, 2023
Companies are increasingly creating new C-suite roles with a focus on data, analytics or artificial intelligence-to the confusion, and sometimes chagrin, of chief information officers and others who previously had oversight of data.
As the use of data, analytics and AI becomes a board-level concern, thanks in part to the viral popularity of ChatGPT, more companies are appointing chief data officers, chief data and analytics officers, and chief AI officers, who are often directly reporting to CEOs, said Ryan Bulkoski, global head of executive search firm Heidrick & Struggles’ Data, Analytics & AI Practice.
Mr. Bulkoski estimates that about 70% of companies in the Fortune 500 have someone responsible for data at the C-suite level or just below, and the trend has been picking up in recent years. According to a 2022 survey by Heidrick & Struggles of 120 executives in those roles, more than 75% said the job had existed in their organization for less than five years.
Some tech leaders say that creating such new roles is vital to leveraging data in the business, especially where existing CIOs and chief technology officers are bogged down with other responsibilities and can spend only a fraction of their time on data. Further, such roles give boards a single point of contact with specialized expertise on topics they must consider as these new technologies draw regulatory and investor scrutiny.
But the new roles can also lead to tension with other C-suite leaders, confusion over responsibilities and disappointment from business counterparts who expect fast results. So companies are encouraging collaboration as CIOs who previously had oversight over data yield control to newcomers.
“There’s always going to be some kind of friction that’s happening,” said Dak Liyanearachchi, NRG Energy Inc.’s chief data and technology officer. “The teams around you are going, ‘Well, I do some of that,’ or ‘Why are you telling me how I should be thinking about doing things differently?’” he said.
Mr. Liyanearachchi, who joined NRG as its senior vice president of data and analytics before transitioning to the combined role, said the biggest problems arise when leadership doesn’t have clear visions and expectations for what the role should look like or doesn’t secure buy-in from other leaders in the organization.
“Never underestimate what you think you’re asking for and how the rest of the organization is going to react when that role comes in,” said Mr. Liyanearachchi, who was previously the chief data and analytics officer at Hilton Worldwide Holdings Inc. and the chief data officer at Catalina Marketing.
At TaskRabbit Inc., VP of Data Chi-Yi Kuan and CTO Ron Forrester, who both report to the company’s CEO, said that collaboration is critical to both their functions being productive.
In areas where the two functions overlap, such as engineering processes and managing talent, Mr. Forrester said, it may never be 100% clear whose domain a certain decision might fall into.
“We’re not going to come up with a perfect process to make all the decisions in a silo and where they belong,” he said, adding that the emphasis now is on: “How do we make sure that we’re having the right conversations at the right time together as opposed to apart?”
Ameen Kazerouni, who entered Orangetheory Fitness as chief data and analytics officer in 2020, said he regularly met with the then-CTO to ensure alignment on key areas, such as architecture so that data could flow properly through the organization. The CDAO and CTO roles were merged last year under Mr. Kazerouni.
Before the merge, he said, there could be push and pull since each function was using its architecture for different purposes — with the data team focused on data quality and integration and the technology team focused on speed, feature delivery and product evolution.
The chief data officer role is a difficult one to succeed in, said Mr. Kazerouni, who added that he sees a lot of chief data officers leave after only a couple of years in the role for various reasons.
“I’ve seen expectations with data and machine learning and analytics in general be difficult to live up to in the timelines and level of investments that are prescribed to it.”
When done properly, the role can add a lot of value, tech leaders at Wind Creek Hospitality said. The casino operator created the role of chief data and analytics officer in 2021 and appointed Ganesh Bala. Before that, President and CEO Jay Dorris said he felt like using data was more of an afterthought since the CIO and CTO already had a lot on their plates.
“Typically, the burden of delivering the data has always been on us,” said Wind Creek CIO John Enriquez. “It got to a point that we needed somebody else to help us as we grew with data.”
Mr. Bala was able to drive change in the organization, including helping the marketing team use data for forward-looking prescriptive and predictive analytics, rather than the descriptive and diagnostic insights they had previously been focused on, he said.
Mr. Bala said that at Wind Creek there was “a huge appetite in terms of what is possible” for the use of data. “But in the same sense, change takes a lot of effort,” he said.
Originally published at https://www.wsj.com on April 14, 2023.
Names mentioned
- Isabelle Bousquette — the author of the Wall Street Journal article
- Ryan Bulkoski — the Global Head of Heidrick & Struggles’ Data, Analytics & AI Practice
- Dak Liyanearachchi — the Chief Data and Technology Officer at NRG Energy Inc.
- Chi-Yi Kuan — the VP of Data at TaskRabbit Inc.
- Ron Forrester — the CTO at TaskRabbit Inc.
- Ameen Kazerouni — the former Chief Data and Analytics Officer at Orangetheory Fitness
- Ganesh Bala — the Chief Data and Analytics Officer at Wind Creek Hospitality
