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What digital transformation means for the CDO

What digital transformation means for the CDO
(Image credit: Shutterstock)

 For years, digital transformation has profoundly changed how organizations go to market, innovate, and connect with their customers and partners. Today’s rapid acceleration of cloud services adoption and widespread use of SaaS applications has created a new level of Internet reliance that’s impacting enterprise digitization efforts and with it, the role of the chief digital officer.

Digitization can be summarized as the coming together of applications and mobility. Together, the two provide frictionless access to data. In less than three years, we’re predicted to reach 300 billion downloaded applications. This evolution of direct access to an ever-broader panel of online services has also created ever-increasing demands on usability, in tandem with ever-decreasing patience for poor user experiences.

More recently, the impact of the COVID-19 pandemic and shift to working from home has emphasized our reliance on digital solutions as a means to conduct business. Embracing digital transformation has gone from a nice-to-have to a key priority for organizations that are now challenged to reinvent the way they do business. But transforming digitally today looks different than just a few years ago and as a result, the role of the chief digital officer (CDO) is being redefined.

Digitization and the customer-first business model

Since the early days of digital transformation we’ve seen the role of the CDO increasingly take center stage, working closely together with the CIO to transform traditional operations using digital processes. While the CDO is charged with rethinking how customers are best served via digitization and other technical solutions, the scope of their effort was oftentimes linked to transformation projects with a beginning and an end. 

Today, businesses are increasingly putting customers at the center of everything, and that means readjusting the business model accordingly. With optimized customer experience as the end goal, functions like marketing, sales and even IT and engineering are becoming intertwined with core business development and go-to-market strategies.

Under this new reality, the expectations on the role of the CDO becomes much broader. The CDO now needs to internalize the company’s vision and express it through digital means by enabling new tools, ensuring consistent performance and accurately assessing technology trends and innovation that feeds into rapid product deployment and services.

Translating technical indicators into business metrics

Critical to that kind of customer-first digital transformation is the ability to measure how digitization efforts impact business and ultimately the bottom-line. To that end, the role of the CDO is to translate technical indicators into business metrics and how they impact revenue and company positioning. 

For example, the CDO needs to monitor connectivity to provide measurable insight into how applications and online services are performing in order to understand how they’re impacting customers’ experience of what is being delivered. Another business metric is that of productivity. Similar to customer experiences being reliant on digitization efforts, so too are employees dependent on always-on functionality in order to perform their jobs.

With the last few years’ rapid acceleration of cloud migration and widespread use of SaaS applications, businesses have come to grapple with an increased dependence on the Internet as the delivery mechanism for both customer and employee experiences. In short, digital experiences increasingly depend on a host of external services, be it cloud, SaaS or the Internet, that are beyond enterprise control. 

As a means of measuring, more and more enterprises are looking to what’s called the End User Experience Score which can be conditionally aggregated to translate technical indicators such as page load time, browser errors, and response time, into a score that illustrates good or poor user experience. For the CDO, while they might not own the underlying IT infrastructure that impacts online performance, they still own the user experience.

Managing the cloud and Internet as your own digital environment

As was the case for many roles that developed and expanded through a transformational process, such as the sales director that became the chief revenue officer, or the director of human resources who became responsible for people and culture, so too is the role of the chief digital officer evolving to include digital management that goes beyond internal scope to include external cloud and Internet-centric environments. This kind of digital management requires a move from siloed visibility solutions to ones that can provide insight into the entire digital journey and how every part of it drives successful user outcomes.

Gartner has defined this shift in focus as a new category called digital experience monitoring (DEM), addressing the move to new digital transformation technology that supports businesses as they seek to regain control over the external environments that are impacting their customers’ and employees’ experiences. 

Scenarios where application performance monitoring (APM) solutions for example used to suffice are now being replaced by more comprehensive experience monitoring solutions that can see into the application’s performance, as well as the underlying infrastructure that it runs on - no matter if it’s an on-premises environment or hosted externally in the cloud. In future digital transformation efforts the role of the CDO will continue to be one that works in lock-step with that of the CIO to power the kind of experience monitoring solutions required to ensure consistent online performance and unlock new digital opportunities - both internally and externally.

Over the course of these past several months during the COVID-19 pandemic, this increased dependence on Internet and cloud infrastructures has compounded as both customers and employees now rely on the Internet to do their jobs and put simply, live their lives. Optimizing digital performance isn’t just about optimizing experiences, but about making sure that the connected solutions we rely on as a society stay up and running. It’s a small piece of the puzzle but it’s growing larger and for the CDO, it’s an opportunity to step up to the plate.

  • Yogi Chandiramani, VP Solutions Engineering EMEA, ThousandEyes.