The C-Team Adds a Member

An increasing number of employers are adding a seat at the executive table for a new player on the team. Joining the likes of the CEO, the COO and the CIO is the CDO: chief digital officer. The challenge for HR officers, however, is finding qualified candidates.

Tuesday, March 5, 2013
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It's a relatively new job title, but companies such as Starbucks, Gannett, Simon & Schuster, NBC News and Kantar Retail have hired a chief digital officer. In 2011 New York City became the first U.S. municipality to add one. Harvard and Columbia universities have CDOs. Nonprofits like the Center for Public Integrity and the Lincoln Center for the Performing Arts do, too.

It's enough of a trend to merit the Chief Digital Officer Summit, a series of multi-industry panel discussions set for Feb. 28 in New York.

By 2015, Gartner, the information technology research and advisory firm, predicts that 25 percent of organizations will have a CDO.

"I think that sounds about right," says Ravin Jesuthasan, global head of talent management at Towers Watson. In the past four or five years, "it's started to become a really big thing," he says, and the pace has accelerated even more in the past 18 months.

Half of the 352 HR professionals who responded to a worldwide survey, Global Talent 2021, conducted by Oxford Economics last year, said that digital acumen will be the skill most in-demand in the next five to 10 years. That ranked highest among four broad skill areas cited.

That's because digital serves employers and consumers alike. "I see digital transforming all sorts of business models. It connects you with stakeholders in a very different way that's more intimate, more direct," Jesuthasan says, while decreasing costs and increasing an organization's relevance. "It gives [consumers] a level of control we've never had before."

Indeed, consumers are downloading information from mobile phones to compare prices and search for deals. Companies, of course, can reach consumers directly via digital devices. Nonprofits are finding digital is a means to reach stakeholders with urgent, timely updates on, say, the latest spate of elephant poaching in Africa, along with an appeal for donations.

Last October, New York City's Chief Digital Officer, Rachel Haot, was overseeing efforts to keep citizens informed via Twitter and other digital media with updates on developments during Superstorm Sandy. Now she is a key player in a "We Are Made in NY" multi-platform initiative launched this month to help entrepreneurs and entice new startups to the city.

The challenge, however, is finding qualified candidates to become CDOs. A CDO must have a blend of skills that include digital and managerial expertise, and the ability to lead businesses through future technological changes.

"There are plenty of people who know digital really well. It's a rare person who . . . wants to translate that into a larger company, a traditional company," says Jana Rich, a managing director at Russell Reynolds Associates who co-leads the Consumer Digital and Media practice and the Digital Transformation practice globally.

The job differs from company to company and among industries. Some employers may need a person whose primary job is that of a strategist, transitioning a company that is not digital by nature. Others want more of a technology wonk, and still others seek somebody with marketing savvy to help them engage customers from a technological perspective, Rich says.

Generally, however, a CDO needs to come from a diverse business background, Rich says. "They need to think cross-functionally."

Simon & Schuster hired Ellie Hirschhorn as its CDO in February 2008. She had previously worked in finance and investment banking, followed by high-level positions in both business development and strategy for traditional and digital media at companies that included Viacom and MTV Networks.

Since joining Simon & Schuster, Hirschhorn has been involved in several digital initiatives, such as including author videos on the company's website and other platforms. "She and marketing work very closely together," says Carolyn Connolly, the book publisher's vice president of human resources.

HR officials will be on the front lines with other company executives in determining new business models and what skills a CDO needs to implement them, Jesuthasan says. So where do they find good candidates?

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"I'd look and see what companies are ahead of the curve in my industry," Connolly says. Thanks to Simon & Schuster's hiring of a CDO five years ago, "we really are considered ahead of the curve among our competitors."

CDO candidates are unlikely to come from small technology startups, Rich says. Strong candidates typically have a technology background from digital stalwarts such as eBay, Amazon and Google, she says. "These jobs really do require someone comfortable working across large organizations."

But, Jesuthasan adds, businesses and employees have always retooled when technology changes, so HR officers may have potential CDO candidates in-house who just need additional training.

"You're going to see talent-acquiring opportunities" within the organization, he says.

Too often, however, training and mentoring for a new CDO is inadequate, Rich says. One potential solution is to pair the new CDO with a board member who has a technology background. "That's an interesting hybrid solution," she says, but only if the board member has adequate time to devote to it.

That's where HR officers play an important role. They can help the CDO build a team and ease his or her transition to the company's culture, Rich says. "In most cases, they are working very closely," she says. "The HR person is almost a coach."

Connolly agrees.  "There is an evolution that needs to take place when someone like this joins the company," she says. "People need to know how and why it is, and the value of it. HR can play a huge role."

Occasionally, employers have hired a CDO, only to scrap the position later, Rich says. It's imperative that company executives establish beforehand what the firm's goals are in creating the position, how important it is to do so and whether the organization is ready for change, she says.

Regardless of how the job is defined, the CDO unquestionably is a top-level C-suite executive, reporting to the COO or the CEO, as is the case at Starbucks and Simon & Schuster.

"The CDO is potentially your future chief operating officer," Jesuthasan says.

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