By John Wysseier, CEO and President, The CEI Group
Last month, I wrote that for an organization to embrace disruptive innovation for long-term survival, it takes leadership — not just from the CEO, but from the entire C-suite of senior executives. Today, I want to consider another essential ingredient: a Chief Disruption Officer or CDO.
I want to start by pointing out that there is some ambiguity about this title. For some, CDO stands for Chief Digital Officer, more of a technology-focused position, while for others, the Chief Disruption Officer is a position that combines equal measures of expertise in sales, marketing, operations and strategy in addition to a grasp of digital technology. Yet, others bridge this divide by adding another D, and calling the position Chief Digital and Disruption Officer, or CDDO.
Whatever the title, I want to focus on whether the C-Suite needs another player whose focus is disruption in terms of playing offense and defense. In my view, it does because most businesses – especially well-established and successful ones — are focused on defending the status quo and understandably anxious about radical change. After all, as the shared wisdom goes, “If it ain’t broke, don’t fix it.” Concern over the next quarter’s or the next year’s financial results dominates executive thinking rather than whether the company will continue to exist in five or ten years.
It is not that companies are averse to innovation. In most companies I know, innovation is a priority. In fact, over the last 10 to 20 years, many companies have added a “Chief Innovation Officer” to their C-suite. The problem is that, for many successful companies, innovation often comes down to line extensions or improvements in established ways of doing business instead of identifying applications of digital technology that pose existential threats or opportunities to remake themselves.
Looking deeper, consider human nature. Once we discover a solution to a problem, we stick to it for as long as it works. The trouble is that technology is advancing so rapidly today that businesses that grow comfortable with their own solutions are often blind-sided by new solutions they never imagined, which were hidden in plain sight.
For examples, look no further than what Amazon has done to brick-and-mortar retailing, what Uber has done to the taxi industry, and what Airbnb has done to the hotel industry. Each one harnessed the power of a new technology that was known to all to disrupt industries that weren’t looking beyond their traditional ways of doing business. Most of them involved new applications of the Internet, but leading companies of the future are already working on applications of other fast-emerging technologies, like artificial intelligence, blockchain, virtual reality and the Internet of Things.
As a new player in the C-Suite, the Chief Disruption Officer must look beyond the horizon and consider radical changes. To be successful, he or she must look beyond the next year and look outside the company’s industry for inspiration. At the same time, the CDO needs to work closely with all of the organization’s business units, customers, and stakeholders to identify opportunities for business transformation in the form of new business models, improving customers’ digital experience and re-designing operational processes.
It’s also important to note how the Chief Disruption Officer’s role compares with that of the Chief Information Officer, or CIO. The main difference is that the CIO innovates within the confines of his or her own industry, while the CDO is expected to look beyond those confines and bring in technology that is truly game-changing in nature for the industry and its customers.
The need for this role has already become plain to a number of companies. PWC, the global consulting company, found that as of 2017, 21 percent of the largest 2,500 companies worldwide have appointed a CDO, compared to just 6 percent in 2015. But is it the right move for your organization? Here’s digital consultant Nicholas D. Evans, writing in a recent issue of CIO magazine had to say:
“For skeptics, roles such as the CDO are just built on buzzwords and the core C-level roles are entirely valid and fit-for-for purpose. While…not all organizations need a dedicated CDO, I believe there are some key benefits of carving out a CDO role:
“First, it helps focus the organization on the new work that has to be done – the importance of a holistic digital strategy, the importance of digital ecosystems…a new architectural stack to underpin platform business models [and remain] agile and scalable.
“Second, it helps bring an unbiased perspective to help drive and foster cross-business unit collaboration…Third, the CDO roles can bring an enhanced focused on continual innovation.”
I’ll close with another quote, this from a blog by the team at prooV, a global proof-of-concept software firm:
“As more and more companies recognize the value of internal disruption, the need for CDOs will grow across all verticals. Enterprises that don’t embrace disruption and facilitate the role of the Chief Disruption Officer within their company risk finding themselves on the list of giants who have fallen.”