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News & Press: Feature

The Rise of Chief Digital Officers

Wednesday, April 24, 2013   (0 Comments)
Posted by: Christine Leja, CDP/CCP, CEO of Le Com Enterprises

Chief Digital Officers (CDOs) are being hired by large organizations to implement effective services using all appropriate digital technology. The CDO is to insert digital technology solutions using the resources of the organization as quickly and effectively as possible. The perception is that digital technology will give large corporations a competitive edge if done in a very short timeframe.

How did the CDO position emerge? What are the CDO responsibilities and why are large corporations seeking CDOs to innovate, transform, and deliver digital technology solutions for their organizations? Why aren't CIOs leading the way to delivering ROI for large corporations? Are there no functioning partnerships between Chief Marketing Officers (CMOs) and Chief Information Officers (CIOs)? So many questions about the CDO!

First, let's look at some common identified responsibilities of the CDO:

  • Keep pace with technology changes and consumer behavior
  • Integrate digital technology strategies into business strategies
  • Ensure effective use of digital technologies such as web, mobile, social, local, and global trends
  • Drive change across the organization
  • Meet customer needs for fresh information and the ability to buy wherever, whenever and however they want

But, aren't these responsibilities in the CIO and CMO positions? CMOs market an organization's products and services. In a cohesive marketing strategy, the information and materials prepared by marketing are used up, down and across the organization in addition to the outward reach to customers, existing and potential. CMOs manage the whole marketing process from vision through customer delivery.

CIOs manage the IT services and IT deliveries using IT solutions that ensure IT logistics are premier for the organization's products, services, customers (including prospects), and employees. Measurement of premier IT service delivery, efficiency improvement, application delivery, performance improvement, business performance improvement, and market performance are included. With the CIO at the executive (CXO) table, the IT strategy services functional business areas in alignment with the organization's mission, vision, and overarching strategy and tactics.

So, why the need for the CDO?

If CIOs are at the CXO table and involving the CXO lines of business, then the CIOs are anticipating and prototyping the next generation of IT tactics. But, if the CIO is viewed merely as a cost center and not as a revenue producer, then the CIO position has been limited as a service provider to lines of business. Given a narrow definition of the CIO position, large corporations have no choice but to consider a CDO since, unfortunately, the organizations have limited the consideration of the effective use of IT. But the large corporations who have anticipated business needs and view IT as a strategic asset have CIOs who encompass CDO responsibilities at the CXO table and these CIOs are equipped to rapidly respond to competitive opportunities.

For organizations that have a proactive CIO, CMO and other CXOs that regularly communicate across all levels of need (strategic vision, tactical vision, resource constraints, priorities, etc.), this is a forward thinking organization that can effectively use IT in the digital technology world and may not need the services of a dedicated CDO.

Communications have a life cycle that permeates the organization with CXOs being astute to pick up on applicable ideas and share them with their peers. Informal and formal communications among peers can vet ideas and build salient points for broader CXO discussions. Here is where the transformational components originate. Here is where CXO partnerships on concepts and ideas grow and evolve to a potential strategy or business direction. Here is where the CMO and CIO partnership can catapult an organization into the effective use of digital technology! (See " Is a CDO Equal to a Set of Common CMO and CIO Responsibilities?” for more in-depth information on the CMO and CIO partnership.) What better way to bring forward a transformational product or service than with CXO partnerships?!

Digital technology is moving at a rapid pace and organizations must keep momentum or lose opportunities to keep or obtain customers for their products and services. The life cycle of new digital technology is very short. So swift is the digital technology movement that organizations cannot keep pace with the shift from traditional market processes to include digital technology. Already, there are firms operating in the digital world without any physical locations – Amazon comes to mind along with Netflix and a host of others. Businesses and other organizations MUST keep pace with the digital transformation that is impacting traditional business practices!

The CDO responsibilities exist whether it is a separate CDO role or part of the CMO and CIO roles. The important point is that the CXOs recognize the strategic asset they have in IT, see the immediate need for IT tactics, and appropriately assign resources to accomplish the projects to deliver digital technology as a viable operational component.

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