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November 28, 2012

CIOs Traded Up for Chief Digital Officer

By Dave Courbanou

CIOs are being tasked with a litany of new responsibilities, from maintaining intra-office relationships to rolling out company-wide cloud capabilities. With all that change, it’s possible the role of the CIO isn’t needed — it may be time for the rise of the Chief Digital Officer, or CDO.

An essay by Russell Reynolds Associates, an organization dedicated to senior executive research and assessment, has deconstructed the evolving role of the CIO, making the case that new goals, responsibilities and knowledge of modern technology is carving out the CDO position.

A CIO may already be a CDO-in-training, but in some cases a new individual to fill the CDO role may be needed — likely a younger individual. Existing CIOs can adapt to these needs, and those who do may build their own succession path to CEO.

A well qualified CDO will have the following traits:

Digital Talent: It’s not enough to be pro-BYOD or have the latest smartphone. A CDO must understand how new technology fits into the business IT landscape, which includes a deep understanding of tablets, smartphones, social media, e-commerce and critical transformative technologies. A well-prepared CDO can lay out a path for capabilities that don’t necessitate a rip-and-replace scenario. An extra-special CDO will even understand how to code and program, which can facilitate a better understanding of what is expected of developers within the company and when outsourcing a project. CDOs should be keen on the latest revenue models in usage and execution. The need to be a “digital guru.”

Internal Management: General management of employees, team building and leadership qualities are a must for the CDO. Intra-personal relationships will require international flair and “cultural sensitivity,” due to the likelihood of heading up global teams and conducting worldwide business. This global awareness must be paired with an ability to see the big picture and execute on strategic plans. Agility in making critical business decisions and understanding how best to change a strategic process will be key CDO priorities, in addition to shaping strategy to align with business profits and losses.

Executive Elevation: According to Russell Reynolds Associates, “The CDO will be the senior executive handling the fastest growing revenue streams within the business or will be the executive holding the keys to the company’s future.” This means the CDO will be in line for succession to the CEO role — but getting there isn’t just a revenue game. A CDO will need interpersonal skills that allow him to communicate the new wave of technology to the old guard of existing executives, instilling trust in the idea of succession.

The development of the CDO title is predicted to evolve, particularly as more business moves into the cloud. When these succession plans are fully engaged, they will usher in new executive roles. Expect “Digital CEO” to be a normal title for the head of many organizations by 2017.

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