“Often, it has to do with someone’s ability to influence others,” adds Mike Doonan, partner at executive search firm SPMB. “They’re usually coming into an old-line company that’s used to doing things one way. This is the one intangible I advise my clients to look for — you want someone who’s a visionary but also someone who understands people can’t absorb that vision all at once. If we’re at A right now and we need to get to B, they need to paint the picture of what B is, but then break it down into small incremental pieces of how to get there without skipping any steps along the way.”
To test this ability, he asks job candidates: “You had a vision for launching a new service and everyone told you you couldn’t do it. How did you do it?” Those who fail only focused on the vision and got frustrated when no one followed them, he says. They couldn’t explain the short-term benefits.
Where the chief digital officer fits in the C-suite
Some chief digital officers report to the CIO or to the CMO. But when chief digital officers fulfill a more visionary function, they should report to the CEO or perhaps the COO, experts say. In fact, Gurumurthy argues, in those situations, other technology executives should report to the chief digital officer.
“When it comes to tech decisions for products, the chief digital officer should work with the CTO, and when it comes to internal processes, he or she should work with the CIO.” The chief digital officer should also work with the chief talent officer when it comes to hiring the skills needed for digital transformation, he says. “The chief digital officer becomes an orchestrator who sets the vision and goals.”
Or at least, the chief digital officer needs to be on a par with these other roles, he says. “You have to have a seat at the table to influence the CIO, CTO, and chief talent officer, to be a real peer. Otherwise, you won’t succeed.”
Does your organization really need a chief digital officer?
When should your organization consider hiring a chief digital officer? Although he warns that this opinion is not backed up by research, Gurumurthy thinks a company with about $2 billion in annual revenues in an industry such as retail where the need for digital is high needs a chief digital officer, or a $5 billion company in a less digitally-dependent industry such as traditional manufacturing.
Still, you should make sure you know exactly why you need one before you start hiring, Doonan warns — he’s seen too many companies hire a chief digital officer just because they thought they should. “During an up cycle, Wall Street analysts ask, ‘What’s your strategy for competing with X company that’s super-innovative?’ And top management says, ‘Oh we need a digital strategy.’ They put together an innovation center that’s headed by a chief digital officer. Then the market corrects, and the analysts ask, ‘Where’s your profitability?’ And then they dismantle the innovation center.”
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