Should Chief Data Officers be Insiders or Outsiders?
How the Answer Can Boost Organizations’ Effectiveness and Innovation
Are the most innovative CDOs insiders or outsiders? In our last blog, “Enriching the Soil for Data Innovation”, we described how Chief Data Officers in the Federal government were planting seeds for success by harnessing their organization’s culture, fostering data experimentation, engaging in collaborative activities and sharing data-focused experiences. The leaders we spoke with were successful by understanding and adapting to the needs of the organization in order to advance data innovation and maturity. The Evidence-Based Policy Implementation Act legislates the hiring of CDOs at all agencies. With a significant number of new data leaders being appointed, let’s consider whether some organizational characteristics may affect the selection and plans of the CDO.
Why Consider an Insider?
A popular discussion point is whether it is better for a CDO to come from inside the organization or be brought in from outside. It seems the most likely answer is “it depends” on what the organization needs from the CDO. With recent appointments, we see both tactics being used. What might lead to consideration of an internal appointment? For an agency whose charter is to share data, such as NOAA, an internally appointed CDO who understands the strategy, the operations, and culture, has an advantage. These include insights about:
- key sponsors, supporters, stakeholders, and change agents
- organizational and data systems’ strengths and weaknesses, and
- opportunities that are ripe for innovation and rapid progress
An internal candidate understands how to navigate within the organization, knowing how to tap into the right resources and structures. However, the internal candidate must also guard against falling back to organizational norms and “business as usual”. The objectives laid out in the Federal Data Strategy Action Plan and the Evidence-based Policy Act may need new approaches to drive significant change. What would make an internal candidate successful? Their willingness to experiment, challenge norms, set clear goals, and inject alternative approaches to build momentum and deliver results.
Why Consider an Outsider?
An external-to-the-organization hire (from industry, academia, non-profits, or elsewhere in government) signals a desired focus on fresh perspectives or new skills. It may reinforce the elevation of the role of the CDO as a key leader in the organization. An advantage of hiring a CDO from outside the organization is that they provide an independent voice and are not encumbered with history. However, this CDO must build internal credibility to influence and motivate early adopters to drive change. The caution, however, is to not cause more disruption than the organization can handle. Benefits of bringing in a CDO from outside the organization include:
- candidates are vetted and qualified for their specific, validated expertise
- an external hire can fill an identified strategic or functional hole in the organization’s leadership team
- external best practices knowledge can be a significant part of what they bring to the table
- candidates can bring insights from previous organizations practices, goals, challenges, successes, as well as failures
- they are not being typecast within the organization by their previous role(s)
What would make an external candidate successful? The same willingness to drive change, but an understanding that not all organizational experiences and assumptions translate equally effectively. The net effect should be greater, more constructive change. The leader must have the willingness to take the time to understand the current organization, its goals, and challenges.
Where Should the CDO Report?
On the heels of whether the CDO is an internal or external hire comes the question of where they should report within the organization. Should the CDO report to the agency director, to the finance function or IT function, or possibly somewhere else? Definitively, the appropriate answer here again is
, “it depends”. It relies on how best to assure that the CDO has the needed influence to champion change. To do so, the CDO must be positioned as a peer to those decision makers responsible for budget, workforce, and IT as well as mission stakeholders. . CDOs must be able to make and influence important decisions. Driving change requires a clear voice at the table.
The mission and responsibilities of the CDO will dictate where they should land. It helps to understand the specific parameters that the organization is dealing with to determine the best positioning within the organization. These parameters may include the data-sharing charter, regulatory and compliance requirements, operational challenges, organizational size, and overall agency strategy. Don’t obsess about the details; rather, understand the levers the CDO has available to drive the desired positive change.
CDO Selection Gives Agency Leaders a Chance to Innovate
With the objectives outlined by OMB for elevating the importance of data use and sharing, the CDO needs to be in the “right seat” with the ability for a strong, effective voice in management. The CDO must be empowered to drive positive change through a value-based approach, addressing key data issues affecting their organization and have adequate resources at their disposal to achieve them. With the focus on evidence-based policy and data action plans, CDOs already have a broad mandate to be responsible for data governance and lifecycle data management. They also need to regularly engage with other agency leaders, including the head of the agency, who are entrusted with the resources to execute the mission. CDOs need to be responsive to those leaders’ needs while driving an innovation agenda to demonstrate the power of data. Whatever the organizational factors, agency leaders have the ability to strengthen mission outcomes and impact through the selection of a “right-fit” CDO. Take advantage of the opportunity presented in selecting the right CDO. Seize the data! Empower the CDO!
Judy Douglas, Client Industry Executive, Perspecta; ACT-IAC Institute for Innovation Innovators Circle
Dan Gilbert, Strategist, Hewlett Packard Enterprise
David Park, Director, Digital Services, Perspecta
Diana Zavala, Director, Analytics and Data Services, Perspecta; ACT-IAC Institute for Innovation Innovators Circle
Special Thanks to:
Ed Kearns, CDO, Department of Commerce
Michael Conlin, CDO, Department of Defense
Nancy Potok, former Statistician of the US, Office of Management and Budget