The role of the chief data officer (CDO) has been gaining recognition as more and more enterprises hire CDOs. That enterprises have been waking up to the importance of managing their data or information well has been contributing to the growing importance of the role of the CDO. According to Gartner, 25 percent of organizations will have a CDO by 2017. However, there is a lack of clarity over the scope of the roles and responsibilities of the CDO.

The role of chief data officer is still frequently confused with chief digital officer and chief information officer (CIO). But considering the fact that data management is an important part of business strategy in an enterprise, the role of the CDO is going to be clearly defined and standardized across industries soon. (To learn more about CXO roles, see Reality Check: What's the Difference Between a CTO and CIO?)

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The Importance of Data Management

Data is considered one of the most valuable assets in an enterprise. It goes without saying that management of data (or the lack of management) can significantly impact the business of an enterprise. There are several examples of losses enterprises across industries have suffered because of poor data management practices. A couple of examples include:

  • Sony PlayStations were the victims of an attack which resulted in the theft of the account details of 77 million PlayStation users.
  • Customer details were deleted from the database of online retailer Amazon in an unauthorized way and Amazon failed to recover the lost information.

In both of the cases described above, the enterprises faced financial losses as well as the loss of reputation. Therefore, the case of good data management practices cannot be emphasized enough. And data management is necessary not only because it prevents unauthorized attacks, but it also enables the enterprise to utilize the data or information it has to achieve its business goals. According to business consultant James Price, “The benefits to organizations from improving their information management practices are tangible, achievable and significant – at least $20,000 per employee per year.” Unfortunately, data is poorly managed in many enterprises, which gives rise to a lot of risks for these enterprises.

Gaps in Current Data Management

Given the rising importance of data, not managing it properly can be a risky proposition for enterprises, as many organizations have realized to their peril. Unfortunately, enterprises have been slow to realize the importance of data management, though some changes have begun to take place. As the volumes of data enterprises have continues to grow, the frameworks to manage data competently are still being developed. So, it will be a while before we reach a maturity level in data management.

The problems lie in how organizations view the practice of managing the data or information they have. Organizations tend to not have any specialized position for managing data. Data management is not viewed as a specialized task and is often confused with IT management, meaning that no one is accountable for how data is managed. How organizations are exposing their data to the outside world has changed as the number of outlets – data centers, storage areas, applications, computers, servers and mobile devices – have increased. But the data management policies have not been upgraded. According to Glenn Finch at global leader for technology and data, IBM Global Business Services (GBS), “about two-and-a-half years ago we saw the emergence of the chief data officer, but organizations are struggling to understand what CDOs do, where they put that role within the organization, and what these executives are responsible for."

What Is the Role of Chief Data Officer?

Depending on how it is managed, data can be immensely beneficial or can spell trouble for an enterprise, just as Sony and Amazon realized. Obviously, managing data needs an expert hand and not just some casual attention from departments whose main preoccupations lie somewhere else. The position of the CDO is that of a specialist that manages all the data in an enterprise with the business goals of the enterprise in the mind. The role of the CDO can be summed up in the following broad responsibilities:

Managing Data to Help the Enterprise Achieve its Goals

At a fundamental level, all enterprises want to promote their products and services and increase their revenue, and it has been acknowledged that data can be useful in helping enterprises fulfill their basic goals. What broad role does the CDO have in this context?

  • Assesses the data available and the data collected by the enterprises and distinguishes between useful and redundant or irrelevant data
  • Discovers ways to utilize the data so that the business goals can be achieved and the data can be monetized
  • Decides the timeline by which the data which was considered useful will be dispensed with or archived. The CDO will also decide on the method of disposing of redundant data.

Managing Data to Eliminate or Minimize Risks

Unmonitored data can spell trouble for enterprises, as evident from the cases of a number of enterprises. For example, a government department lost an $18 million lawsuit because it was unable to find documentation or information that could have helped it defend its case. Enterprises face two types of risks with unmonitored data – unauthorized data theft and loss of reputation – and both could lead to huge financial loss. What broad role does the CDO have in this context? (To learn about the dangers of mismanaged data, see Discovering Data Theft Using Hadoop and Big Data.)

  • Defines ethical standards and rules for using the data, especially if the data does not belong to the enterprise, such as medical records of patients in a hospital
  • Takes ownership of implementation of decisions on data governance and ethical usage of data
  • Defines strategies to manage problems such as legal cases due to data usage or data theft
  • Distinguishes between useful and redundant data and identifies the best methods to store data
  • Determines methods of safely disposing of redundant data
  • Takes ownership of decisions on timelines to dispose of redundant data. According to Debra Logan, vice president and Gartner Fellow, “As CIOs, you do not own the data. When retiring an asset, have you been able to get a straight answer from your business on how long to keep the data? They aren’t making decisions, and you can’t make the decisions about the data.”


The corporate world has been slow in recognizing the value of the CDO. Given that the importance of data is going to increase in the future and the need for a specialist data management position is going to be recognized, the CDO could indeed be the next hot tech job. But considering the present scenario and on the basis of an estimate, it will be a while before the role of the CDO gets absolute clarity and overlapping responsibilities are addressed. The biggest stumbling block, however, seems to be the attitude of organizations towards data management. For reasons unknown, organizations tend to think that they can get by with data being managing by IT people who do not have the proper business skills or perspective. CDOs bring to the table business acumen which they can apply to data management.