Chief Data Analytics Officers – The Key to Data-Driven Success?

Banks were among the pioneers of the new role of Chief Data Officer in the early 21^st century, yet the role remains hard to define and under-utilized. Nearly 64 percent of financial services organisations claim to have a CDO, but 72 percent of organisations still feel that it is an unsettled role. Getting it right can accelerate your data strategy and help save the bank of the future from the clutches of Big Tech.

In many banks they started out as a data policy wonk in the IT team, responsible for writing rules to manage data quality. They had little power and no budget and were certainly not connected to wider business decision-making. At leading banks however, they are now evolving to become powerful champions of data strategy with wide purview and a seat at the top table.

The best, now often called Chief Data and Analytics Officers, are change agents, working closely with functions across the bank to make data less scary and more useful. They play a multi-faceted role as evangelists, teachers, sages and enforcers focused on ensuring the organisation gets the best value from its data. They lead teams of data scientists and ensure they are integrated and aligned with the business. A good CDAO should be the right arm to the CEO as they deliver a data strategy. Given the right responsibility and budget, they can quickly become a vital strategic partner for the business.

Core to the role is the experience and desire to use data to solve real business problems. Combining an overarching view of the data across the organisation, with a well-articulated data strategy, the CDAO is uniquely placed to balance specific needs for data against wider corporate goals. They should be laser-focused on extracting value from the bank’s data assets and ‘connecting-the-dots’ for others. By seeing and effectively communicating the links between different data and understanding how it can be combined to deliver business benefit, the CDAO does what no other role can do: bring the right data from across the business, plus the expertise of data scientists,  to bear on every opportunity.

Balance is critical. Leveraging their understanding of analytics and data quality, the CDAO can bring confidence to business leaders afraid to engage with data. They understand governance, and so can police which data can be used for innovation and which is business critical and ‘untouchable.’ They can deploy and manage data scientists to ensure they are focused on real business issues not pet analytics projects. Innovation-focused CDAOs will actively look for ways to generate returns on data assets, and to partner with commercial units to create new revenue from data insights.

The CDAOs are the catalysts that turn the theory of a data-driven bank into reality. Having set the vision, developed the data strategy and roadmap, the CEO should look to the CDAO to operationalize it. To be effective CDAOs need power and budgets, and this means executive sponsors at the highest levels. As the hinge-point between strategy and execution, and between board and business, a good CDAO will quickly become indispensable across functions and business units. Chief Financial Officers may be the most effective board sponsors for the CDAO since, as we’ll see in later blogs, they share an enterprise-wide view of assets. But chief marketing officers and chief risk officers will also come to rely on the CDAO as the data strategy is operationalised across the organisation. Making the right decisions now to set up CDAOs to succeed in the bank of the future, getting them onside, invested, empowered and incentivised as evangelists and facilitators of data driven innovation, will accelerate growth and effective defence against Big Tech encroachment.

Over the next few weeks we’ll look at how CDAO’s can help implement the data strategy to drive intelligent conversations for the CMO, identify cost savings for the CFO, and mitigate risks and avoid costs for the CRO.