Champion of Change: Why Chief Digital Officers Will Become Essential

It seems like a match made in heaven. The primary function of the chief digital officer (CDO) is to help drive the agenda in industries that need to transform, and perhaps nowhere is this need as great as in healthcare. As a result, CDOs are slowly starting to pop up in health systems that have the vision — and, quite frankly, the means — to appoint them.

But for many, questions still abound. How exactly can this role help push organizations forward, and what differentiates the CDO’s responsibilities from those of the CIO? In this interview, Hillary Ross of Witt/Kieffer provides much-needed answers, and discusses the qualities that are most important for those who want to step into the role of “digital evangelist.”

We’re starting to see the Chief Digital Officer (CDO) emerge as a key member of the senior leadership team across many industries. What are you seeing on the healthcare front?

We are starting to see more CDOs in healthcare; the role has been in other industries for a while. As healthcare systems move to fee for value and start viewing patients as consumers — with choices where they do not have to purchase all of their services from one provider — this role is becoming increasingly important. Systems want to retain patients, draw new ones, and provide a better, faster customer experience that meets their expectations. Technology-enabled disruptors like Uber, Amazon, and smart phone providers are creating an ecosystem of expectations for better and faster service. Can traditional healthcare organizations leverage these trends? The CDO is the answer to that question.

 

What type of organizations are appointing CDOs (large systems, community hospitals with a network of affiliated physicians, etc.)?

Larger organizations are more likely to create a CDO role, because in more complex environments, there is support to appoint a champion of change. Those health systems that will distinguish themselves competitively will have the resources to leverage digital transformation to create innovative customer experiences. Smaller organizations may want this as well, but likely do not have the financial ability to create a standalone role.

 

What are the key responsibilities of the CDO?

The CDO’s role is more about driving the digitization of business models than performing an operational function. This executive does the following:

• Serves as the digital evangelist for the organization, building a core belief centered on innovation and the pursuit of ‘big ideas’ that will transform/revolutionize the healthcare space. He/she is responsible for driving a culture shift and establishing new ways to work in support of this core belief.
• Owns the digital roadmap and ensures that digital initiatives support the organization’s strategic priorities. The CDO uses digital innovation as a catalyst for growth and ensures the organization remains ‘cutting edge.’ He or she will also be focused on ‘outside-in’ innovation — that is, leveraging digital advancements in other industries to drive innovation in health care.
• Creates new operating models and KPIs that effectively measure success of digital initiatives.
• Develops ways to attract and retain top talent, ensuring that the organization’s skills are positioned to execute their digital vision and ensuring that they don’t have a more mature or aggressive vision for digital than they do skills.

 

What was the impetus for the emergence of this role?

It’s all about organizations wanting to be innovative and transformational to better serve their patients while, at the same time, distinguishing themselves competitively. Digitization is a key component of organizational evolution and growth, from the patient standpoint, as well as in terms of business efficacy. They recognize that the next wave of patients will be millennials who expect to view and access healthcare services in a digital format. This transformation also positively impacts the organization’s bottom line. As a result, digital initiatives are taking front and center on the agendas of both senior leadership and the board.

 

How might a healthcare CDO’s role differ from CDO roles in other industries?

It depends on the industry’s need for transformation. Technology companies, for example, are least likely to have a CDO because ‘being digital’ is already part of their DNA. This is where the transformational element comes into play: CDOs help drive the agenda in industries that need to transform, and few industries are being forced to change as radically as healthcare, as the model is shifting to become much more value-focused and retail-oriented. CDOs in healthcare will need to be creative and help to change cultures in organizations. Transformation is hard, but it leads to stronger organizations, optimized business processes, enhanced client service, and more productive partnerships and collaborations.

 

How can the CDO and CIO develop a mutually beneficial working relationship? What other C-suite positions need to have a strong relationship with the CDO?

The CDO and CIO role complement each other and can both be essential; they need a tight partnership. Functionally, both will typically be peers reporting to the CEO; the CDO needs strong relationships with all of the C-suite executives because it is a team effort to transform the organization digitally and drive change throughout.

 

Some say the duties being performed by the CDO should fall under the CIO’s purview. What are your thoughts on this?

It depends on the organization, of course. Ideally, the best scenario is having two separate roles. The CIO is inward-facing and already oversees critical components and functions, so adding CDO responsibilities can dilute the focus of an enterprise digital mission and add to an already crowded plate.

In many organizations, CIOs still primarily lead all digital efforts, but this is evolving. The CDO and CIO roles can be complementary; this requires delineation for activities that involve enterprise digital transformation versus various digital projects and initiatives that aren’t unified and focused on a systematic change. If an organization is serious about transformation on all fronts — culture, infrastructure, customer/client experience — both of these roles are singularly important, and together will have the highest likelihood of driving success across organizations and systems.

 

What do you believe are the key qualities in a successful CDO?

A few qualities that stand out include:

• A background in digital technology as well as a strong customer success/client delivery focus;
• Comfort in challenging the status quo and ‘the way things have always been done’ to bring creativity and innovation into the organization;
• A change agent able to break silos and rethink the organization’s needs for digital transformation;
• A creative thinker, innovative and visionary with strong ability to execute; and,
• A dynamic personal style.

 

Great. Thank you so much for your insights, and we look forward to speaking with you again in the future.