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Beyond the CIO/CMO Partnership
The Rise of the Chief Digital Officer

® 2014 ADJUVI 2
Introduction
Dion Hinchcliffe
• ZDNet’s Enterprise Web 2.0
• http://blogs.zdnet.com/Hinchcliffe
• ebizQ’s Next-Generation Enterprises
• http://www.ebizq.net/blogs/enterprise
• Adjuvi Chief Strategy Officer
• http://adjuvi.com
• mailto:dion@adjuvi.com
• : @dhinchcliffe

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Who will lead digital
transformation in the enterprise?
What should they achieve?

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The Opportunity
• Our conception of business has
reached a crucial transition point
in the digital age
• Evidence now shows that the
industrial age model of the
enterprise is in widespread
decline
- Essentially failing to properly
employ our most important bridge to
the future: Technology
• We need better models with
which to rethink our
organizations for digital
• But the details of these news
models are not very well
captured and codified yet
• How can CIOs and CMOs better
capture the opportunity and
realize change?
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Is a CDO the answer?

T-Mobile wanted to get out ahead of customer defections to
other carriers. They needed an accurate and scalable source of
information. They looked to social media.
The Story:
The Results:
The firm integrated big data across their IT systems, using near
real-time the analysis of 33M customer data records, web logs,
billing data and social media information. The result: The company
was able to cut customer defections in half in a single quarter.
Industry:Telecommunications
Source: Financial Times
Example of rapid digital impact involving CIO + CMO
Cut customer defections
in half in a single quarter

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Technology Leaders Must Prepare For An Era of
Unprecedented Change
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2013 2020
Lifespan of
S&P 500 Company
~15 years ~9 years
Portion of Digital
Natives in Workforce
35% 75%
Speed at which data
in enterprise doubles
~2 years 3 months
Core Focus of IT
Systems of
record
Systems of
engagement
Percentage of IT
under CIO control
66% 10%

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Technology is “destroying” companies in most industries
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A perfect storm of tech change, happening
almost all at once
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The Internet of Things: Everything will have an IP address

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Replicator technology has arrived
• 3D scanning and printing will
fundamentally remake supply
chains
• Design becomes the most
important element of
business
• Homes and workplaces will
increasingly focus on
suppliers of design, rather
than suppliers
• For many industries, workers
will have to move from
building things to designing
them
• A growing majority of things
will eventually be 3d printed
for work or home at the point
of use

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The emerging social economy...
...one third of the world economy by 2020

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Technology has led to an era of unprecedented productivity
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But is this coming from CIO budgets?
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Is IT leading innovation today?
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Our Service Delivery Models Aren’t Keeping Up
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Average
IT Dept.
End state: IT as a profit center

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Yet digital is
pervading the
core of our
businesses
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Source: MIT Digital Transformation Study, 2013

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Executives feel
the urgency:
82% believe
digital
transformation is
critical within 2
years.
With most saying
they have to do it
now.
17
Source: MIT Digital Transformation Study, 2013

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Good news: 60% of CIOs believe they should
be driving growth and productivity.
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Source: Deloitte Global CIO Survey

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But CIO Role Is Under Pressure in the C-Suite
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The Infamous Data Point: By 2017, most CMOs
will spend more on technology than the CIO

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Partly Because There’s Too Much To Do Now
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Key Point: This is a minimum view of digital strategy today

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And the CIO’s sub-roles are conflicting
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Source: Ray Wang, Constellation
business
continuity
business
innovation

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And the “edge” of IT keeps growing into other business units
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Yet technology change is happening faster
than ever before
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Tablet
The tablet is the fastest adopted mainstream technology in history

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Can we alter Martec’s Law?
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CDO?

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Is all this change worth it?
Life Expectancy of S&P 500 Company
Pace of Technology Change
Human Population Growth

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Workers
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IT
Another Way of
Looking At This
World
(Not To Scale)

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New Digital Engagement
Channels Are Now The Focus
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And where
the value is...

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In fact, the biggest digital challenge CxOs must solve:
Engaging at scale
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OK, and channel
fragmentation

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So perhaps the most significant change this shift
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And why CIO and CMO roles are intersecting

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We have to reconcile IT with systems of engagement
A job for the CDO?

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We need tech organization that can match successful digital natives
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Because most businesses are still immature with digital
Webinars
social media
P2P video
online video
direct mail
mobile
apps
Competent
Maturing
Immature
cloud
big data gamification

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This means CIOs and CMO are still learning to work together

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But CIOs are
getting the
external facing
message...

Mobile
Social
Web
Print
In-Person
awareness
get a
recommendation
research &
learn
join
learn
get help
participate
interact
co-support
traditional
media
social
media
The
Engaged Constituent
Journey
advocate
virtuous cycle
So CIOs and CMOs Must Put All These New Pieces Together
Using All Digital Touchpoints To Engage
Today’s Stakeholders in Scale
recommend

Example of market-facing IT impact at the edge in public sector

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Key Leadership Finding
• Technology leaders
use differentiation on
the leading edge of
tech for disruptive
innovation
• Reinvent the business
for the unique
strengths and
characteristics of new
digital channels
• Lead the business in
digital transformation
- Remember, technology
is a force multiplier
- It separates the leaders
and the laggards
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The emergence of the Chief Digital Officer
• CDOs worldwide in 2012: 225
• CDOs worldwide in 2013: 448
• CDOs worldwide in 2014: 1000+
Source: The CDO Club
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Mandate: Digitally enable lines of business

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Leading firms are hiring Chief Digital Officers...
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Common Skillset:
“Overall, CDOs are
generally professional
leaders and business
builders with digital DNA
who have P&L
responsibility and
backgrounds in General
Management, Corporate
and Business Development,
entrepreneurial disruption,
and the ability to get buy-
in from multiple
stakeholders across
company silos.”

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A cross check on demand for CDOs...
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Recent Chief Digital Officer success story
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Revenue
US$ 6.2 billion
Founded:
1972

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Key Roles of the Chief Digital Officer
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Maintain an easy-to-explain
story for the corporate digital
strategy.
1
Earn company-wide
commitment for the digital
strategy.
2
Embrace data-based
experimentation.
3
Connect with digital experts in
the company and the broader
industry.
4
Speak multiple business
languages (IT, marketing,
strategy, finance).
5
Strive for tangible and
measurable results.
6
Keep the strategy fresh with
the latest innovations & shifts
in the market.
7
Maintain focus on and
commitment to executing the
strategy over multiple years.
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Source: Joe McKendrick, ZDNet

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Key Skills for the Chief Digital Officer
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Business Skills
Marketing/
Communications
Tech/IT
Legal,
Logistics

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How it will impact existing C-level roles
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Chief
Marketing
Officer

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The New Tech Leader Mandate
• Act like an owner of the business
- Lead the business from the front
• Reinvent the business for next-gen digital
- Do not (just) literally translate the old business, or even
old digital, to new digital channels
- Use the intrinsic powers of the latest digital channels
(social, mobile, etc.) to transform business models
• Create new and highly engaging digital workplace,
customer, and business partner experiences
• Enable emergent, decentralized tech change in the
organization
• Don’t constrain IT, fundamentally empower
- Everyone is now in the IT department
- Put up guardrails and get out of the way (security,
governance, etc.
45

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Summing Up: Designing the New Enterprise
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The Next Generation CxO
• Unconstrain: Provide everyone simple,
easy to understand rules of engagement
for social,
mobile, big data, and cloud.
• Lay the foundation for managing and
governing 10-100x more IT and data.
• Throw out the traditional IT playbook & go “emergent.”
• Enable the CDO to rethink the business from the edge-in:
Budget, resources, cooperation.
• Identify “future of business” skills, then cultivate or hire
for them.
- Hire your CDO instead of waiting for one to be imposed
- Engagement skills of every flavor (mobile, social, IoT,
analytics)
- Both IT & the business must become design thinkers
• Become a change agent and an IT revolutionary. You
might not have your job in it’s current form long anyway.