the health strategist
institute for strategic health transformation
& digital technology
Joaquim Cardoso MSc.
Chief Research and Strategy Officer (CRSO),
Chief Editor and Senior Advisor
October 20, 2023
One page summary
What is the message?
With the growing prominence of Chief Data and Artificial Intelligence Officers (CDAIOs), their roles are increasingly precarious and often set up for failure due to poor alignment, a lack of trust, insufficient focus on business opportunities, and internal misunderstandings.
It’s imperative for companies to revamp their approach to CDAIOs as they navigate the evolving data landscape.
Key Takeaways
- The CDAIO role is still relatively new, with its scope expanding from Chief Data Officers (CDOs) to include analytics (CDAO) and AI (CDAIO). However, only a fraction of companies consider the role successful and well-understood.
- The initial focus on control and risk rather than business outcomes led to insufficient investment in building relationships and addressing critical business issues, resulting in unmet expectations.
- A lack of trust in data, analytics, and AI investments hampers further commitments. Business leaders need clear proof of the value delivered.
Companies can address these challenges with five key steps:
a. Make data everyone’s business by fostering data literacy and strong governance.
b. Empower business leaders to champion data projects, building trust and credibility.
c. Evaluate data and AI investments rigorously, focusing on essential capabilities.
d. Embrace an ecosystem mindset, promoting partnerships and collaboration.
e. Approach generative AI with caution, emphasizing data governance and cybersecurity.
Statistics
- Between 2012 and 2023, companies appointing a CDO grew from 12.0% to 82.6%.
- Only 35.5% of major companies report the CDAIO role as successful, and just 40.5% say it is well understood internally.
- While 91.9% of companies report value from data and analytics investments, only 23.9% claim to have created a data-driven organization, and 20.6% have established a data culture.
- 83.9% of companies plan to increase their investments in data, analytics, and AI in the near future.
- Just 23.8% of companies believe the industry is doing enough to address data and AI ethics.
Examples
- Schneider Electric carved out data from IT and created the roles of Chief Data Officer and Chief AI Officer, aiming to establish a single source of truth and make high-quality data accessible across the company.
- CDAIOs should seek out business leaders ready to champion data and AI within their business lines, becoming trusted partners through results that build credibility.
- Companies are urged to shift their investments toward essential capabilities, focusing on those delivering measurable business value.
- Schneider Electric emphasizes the importance of partnerships to augment the value delivered to customers through their IoT platform.
- CDAIOs lead enterprise committees with leaders from various functions, emphasizing data governance and cybersecurity measures when dealing with generative AI.
DEEP DIVE
This summary was written based on the article “Why Chief Data and AI Officers Are Set Up to Fail”, published by Harvard Business Review and written by Randy Bean and Allison Sagraves, on June 20, 2023.
To read the original article, access https://hbr.org/2023/06/why-chief-data-and-ai-officers-are-set-up-to-fail
About the authors
Randy Bean is the author of Fail Fast, Learn Faster: Lessons in Data-Driven Leadership in an Age of Disruption, Big Data, and AI. He is a contributor to Harvard Business Review, Forbes, and MIT Sloan Management Review, and The Wall Street Journal, and is Innovation Fellow, Data Strategy with Paris-based Wavestone (EPA: WAVE) and Founder/CEO of NewVantage Partners, acquired by Wavestone in December 2021. You can contact Randy Bean at rbean@newvantage.com and follow him on LinkedIn.
Allison Sagraves was the founding Chief Data Officer at M&T Bank, a role she held for 5 years. She held leadership positions at M&T Bank for 31 years. Allison is currently Adjunct Faculty for the Carnegie Mellon Chief Data Officer Program, and board advisor with several companies. Allison holds a BA from Smith College and an MBA from Harvard Business School. You can follow her on LinkedIn.
