State of the Chief Digital Officer

▸ Digital innovation hubs ▸ Self-learning algorithms improve search results ▸ Digital customer interviews to avoid awkward sales conversations ▸ CxO career moves and job openings ▸

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By journalist Mitch Betts © Ampersand Reports 2019, all rights reserved.
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Hello, and welcome to another edition of Digital Business, a newsletter about real digital activity in corporate America, and the executives leading the way. If you think this is valuable market intelligence, please subscribe — and urge your network to subscribe, too. Thanks for reading. — Mitch


NEWS

The State of the CDO. Chief digital officers cite cultural change and data silos as their biggest challenges, according to a global study. Egon Zehnder International Inc., a leadership consulting firm, surveyed 107 CDOs in large companies across 20 countries. [For convenience we’ll use the CDO acronym here, not to be confused with chief data officers.]

The CDO role varies widely in definition & scope — e.g., some manage technology, some manage small creative teams — but the survey identifies these CDO pluralities:

  • They’re pioneers. 84% are the first to hold a CDO role in their organization, and 65% have been in the role for three years or less.

  • 64% are external hires (presumably those organizations needed an outsider to push digital business in ways that insiders couldn’t).

  • 64% have data scientists reporting to them.

  • 63% report directly to the CEO. And CDOs are an ambitious lot: 42% believe their next job will be a CEO role somewhere.

  • 56% said their primary job is to drive commercial impact and/or digital monetization. (Another 19% said their job is to drive long-term product strategy & innovation.)

  • 55% run their own P&Ls.

The big challenges. While only 10% of CDOs saw their primary role as evolving company culture, 54% said they spend more time on evangelizing (i.e., pushing for internal acceptance & change) than executing. (Just 25% CDOs thought their organizations were ready for digital transformation when they were first hired.) 80% of respondents found that evolving company culture was either more difficult or much more difficult than they expected; 68% also cited integration of data and breaking down silos.

Analysis of additional study results: CDOs may resent being measured by classic financial metrics and wish there were digital metrics of success. CDOs may chafe at the expectation of short-term results when digital transformation may take five to seven years. CDOs may resent the amount of time required for evangelizing when they’d rather be working on execution. (It may be the second CDO who gets to work on execution.) CDOs may wish that CEOs would be a little more forceful in mandating change throughout the business.

The report said that CDOs also questioned whether a digital-only role will become obsolete over time. Rob Barger, CDO of Georgia-Pacific LLC, said: “I should not exist in this role in five years.”


WHO’S DOING WHAT

Real digital activity in corporate America

Grocery retailer opens digital hub. Texas-based supermarket chain H-E-B LP opened its Eastside Tech Hub in Austin, Texas, for its growing staff of digital-focused employees, as well as HQ for its on-demand delivery company called Favor. “Having a shared space like this is crucial to both H-E-B Digital and Favor’s rapid growth,” said Jag Bath, H-E-B’s chief digital officer & Favor CEO.

  • The two-story center is a renovated warehouse with open collaboration areas, individual work spaces, and over 50 meeting rooms of varying sizes, equipped with advanced technology & videoconferencing capabilities.

  • Amentities include a coffee bar featuring local products, a lounge area, a wellness center, a rock-climbing wall, fitness classes, bike parking, and showers.

Self-learning algorithms improve search relevancy. Zappos LLC, an online seller of shoes & apparel, said genetic algorithms are solving a perplexing search-engine issue: irrelevant results. Previously, the search engine would get tripped up by searches for brand names that include a color, such as “Red Wing boots,” and deliver red boots; and searches for “dress shirt” would include dresses. Ameen Kazerouni, the company’s lead data scientist, said his team is using three self-learning algorithms that eliminate such search mishaps. Jared Council, WSJ Pro: AI

Briefly noted:

  • Nationwide will be offering life-insurance customers the option to have a “digital customer interview” to handle awkward questions about medical history and speed up the application process.

  • Baker Hughes, a GE oil & gas services company, and C3.ai (C3 IoT Inc.), an AI & IoT software startup, announced a joint venture. Baker Hughes will use the software internally and act as a distribution channel.

  • Realtor.com added a Commute Time Filter to its iOS mobile app that enables buyers to search for homes by rush-hour and off-peak commute times.

  • Lowe’s Companies Inc. selected Charlotte, N.C., for a global technology center “serving as the epicenter for the team Lowe’s is hiring to help modernize its IT systems and build future retail experiences.” Construction of the Design Center Tower begins in August, with Lowe’s moving in by late 2021. The center could add up to 2,000 tech associates, starting with 400 hires in the next year.


PEOPLE

Appointments, promotions, transitions

Adam Noble recently joined Veritiv Corp., a Fortune 500 company in Atlanta, as SVP & CIO, according to his LinkedIn profile. He previously was CIO for 13 years at roofing company GAF (now a unit of Standard Industries Inc.).

Nautilus Inc., based in Vancouver, Wash., named James “Jim” Barr IV as CEO. He previously led a digital transformation as Group President at Ritchie Bros., and before that was EVP & Chief Digital Officer of OfficeMax.

AccuWeather Inc., based in Sate College, Pa., promoted Steven Smith to the position of President, after holding a variety of positions including CIO (2007-2013), Chief Digital Officer (2013-2015), and mostly recently President of Digital Media (2015-2019).

Gurinder Kaur has started work as CIO for Coca-Cola North America in Atlanta, according to her LinkedIn profile. She was previously VP of Global Commercial & Analytics Solutions at Kellogg Co. Also: She recently announced that “Coca-Cola is building out a new regional development center” in Atlanta with job openings for Salesforce developers and an information architect.

Dave Peak recently joined PerkinElmer Inc. in Waltham, Mass., as Chief Information & Digital Officer, according to his LinkedIn profile. He was VP of Digital Strategy & Innovation at Humana Inc.

MedAware, an Israeli developer of AI-based patient safety systems — primarily aimed at preventing dangerous prescription errors — appointed John Halamka, MD, MS, as as a member of its scientific advisory board. Halamka currently serves as Executive Director of Beth Israel Lahey Health Technology Exploration Center.

iRobot Corp., in Bedford, Mass., added e-commerce executive Eva Manolis to its board of directors. She was VP of consumer retailing at Amazon.com Inc.; and she founded Shutterfly Inc. in 1999.

Charter Communications Inc., in Stamford, Conn., announced that James Blackley is retiring as EVP of Engineering & IT. The announcement continued: “Chief Product Officer Rich DiGeronimo will add Technology Officer to his title as he will oversee Engineering and IT,” and “Blackley will … assist on the transition until his planned retirement in 2020.”

Amala Duggirala was promoted from Enterprise CIO to EVP & Head of Operations and Technology for Regions Bank in Birmingham, Ala. (thus expanding her duties beyond IT to also include financial operations, customer service, and the call center).

GNC Holdings Inc., based in Pittsburgh, hired Ryan Ostrom as Chief Brand Officer, defined as leading “the brand, marketing, digital and e-commerce strategy for the organization.” He will report to the CEO. Ostrom most recently was Global Chief Digital Officer for KFC.

OceanFirst Financial Corp. (parent of OceanFirst Bank in Red Bank, N.J.) appointed Steven Scopellite to its board of directors. He retired from Goldman Sachs in 2013 having served as Global Chief Information Officer.

Provident Financial Services Inc. (parent of Provident Bank in Iselin, N.J.) named Ursuline Foley to its board of directors. She was Chief Corporate Operations Officer, CIO, Chief Data Officer, and Managing Director with XL Group Ltd.

8x8 Inc., a customer contact company based in San Jose, appointed Elizabeth Theophille — currently Chief Technology & Digital Officer at Novartis International AG — as a member of the board of directors.

Okta Inc., based in San Francisco, added Robert Dixon Jr.former Global CIO of PepsiCo Inc. — to its board of directors.

Memphis-based Comprehensive Pharmacy Services Inc. (CPS), the nation’s largest hospital pharmacy services provider, named Karl Bedwell as CIO. He previously spent 30 years as a technology executive at Walmart Inc., most recently in pharmacy operations.

Meredith Corp., based in Des Moines, Iowa, named Farah Zaman as Chief Privacy Officer, reporting to the Chief Development Officer & General Counsel. She previously served as Senior Global Data Privacy Counsel at Colgate Palmolive.

American International Group Inc. (AIG) in New York hired Michael O’Malley as global Chief Procurement Officerreporting to John Repko, AIG’s EVP & CIO. “O’Malley will be responsible for the strategy and performance of all sourcing & procurement services across AIG,” the company said.

Sonoco Products Co., a global packaging company based in Hartsville, S.C., hired Richard (Rick) Johnson as CIO, reporting to the CEO. He had been CIO at HNI Corp. since 2011.

NPower, a national tech training nonprofit based in New York, announced two new members to its board of directors: Dean Del Vecchio, Chief of Operations & CIO at The Guardian Life Insurance Co. of America, and Debra King, CIO at Corteva Agriscience (a division of DowDuPont Inc.).​

Digital Pharmacist Inc. in Austin, Texas named Dustin Humphreys as President. He held roles at CVS Health Corp. such as VP of Digital Pharmacy & Innovation, and GM of CVS.com.

Angie Sargent, Senior EVP & CIO at Fulton Financial Corp. in Lancaster, Pa., was re-elected to a second one-year term on the board of directors of the Pennsylvania Bankers Association, according to an assocation spokesperson.

More recent appointments & promotions: ▸ Steven Bugajski, CIO at United States Steel Corp. in Pittsburgh (reporting to the SVP of Manufacturing Support & Chief Supply Chain Officer) ▸ Trish Torizzo, SVP & CIO at Hologic Inc. in Marlborough, Mass. ▸ Jim Colson, CTO at Cubic Corp. in San Diego ▸ Shri Santhanam, EVP of Global Analytics & AI at Experian plc, in Costa Mesa, Calif. ▸ Matt Hough, CIO at Cintas Corp. in Cincinnati, Ohio, reporting to the Chief Administrative Officer ▸ Fawaz Rasheed, Chief Information Security Officer at Northwestern Mutual in Milwaukee ▸ Ashish Braganza, EVP for Data, Analytics & Innovation at LPL Financial LLC in Charlotte, N.C. ▸ Stephen Felisan, CTO at Edmunds.com Inc. in Santa Monica, Calif. ▸ Andy Roth, Chief Privacy Officer at Intuit Inc. in Mountain View, Calif. ▸ Padma Elmgart, CTO at Global Atlantic Financial Group Ltd. in New York ▸ Jimi Li, CTO at ALM Media Properties LLC in New York ▸ Robert Brous, VP of E-Commerce & Digital at New rue21 LLC (rue21, a fast-fashion retailer), near Pittsburgh ▸ Paul Acevedo, EVP & CIO at CSAA Insurance Group in Walnut Creek, Calif.; also: Marlys Rodgers, Chief Information Security Officer ▸ Chris Moloney, CMO & SVP of E-Commerce at Brinks Home Security in Dallas ▸ Petar Srejovic, CTO at GTreasury near Chicago ▸ Peter Carrara, CIO at Black Knight Inc. in Jacksonville, Fla. ▸ Michael Legg, Chief Data & Analytics Officer at UC Health in Cincinnati ▸ John Walsh III, CTO & CIO at ASRC Federal (a unit of Arctic Slope Regional Corp.) in Beltsville, Md. ▸ Kevin Lilly, SVP & CIO at JELD-WEN Inc. in Charlotte, N.C. ▸ Declan Morris (former CIO at Splunk Inc.), Technology Advisor at Loom Systems Ltd. in San Francisco ▸ John Budala, CIO at PowerPlan Inc. in Atlanta ▸ Sergey Boytsov, COO & CIO at Infinity Laboratories in Castle Rock, Colo. ▸ Pat DeFrancesco, CTO at Genesis Global Trading Inc. (a digital currency trading & lending firm) in New York ▸ Devon Valencia, CIO at CareSource, a nonprofit health plan in Dayton, Ohio ▸ Mo Dastagir, CIO at Cresco Labs Inc. (a cannabis company) in Chicago


JOB OPENINGS

Job descriptions reveal the latest trends in digital business (links worked at time of publication)

Utica National Insurance Group is seeking a CIO, based in New Hartford, N.Y. “Demonstrate CDDO (Committed to Delivering, Despite all Obstacles) behaviors,” on-call 24/7.

Civista Bank in Sandusky, Ohio, is seeking a CIO, reporting to the CEO/COO. “The position will be the lead innovator, operator, and guardian of all company technology-based services.”

Majestic Steel USA Inc. is seeking an EVP & CTO in Cleveland, Ohio. The job requires a “proven track record of significantly improving business performance through technology, data, analytics and market research; deep & extensive knowledge within manufacturing, supply chain and/or distribution industries; … M&A experience, including due diligence & integration experience.”

Circles, a Waltham, Mass.-based concierge service owned by Paris-based Sodexo Group, is seeking a CIO. “The CIO will manage a small internal IT team spread out over multiple countries and manage local & offshore development resources and vendor relations. The CIO is also Circles’ key liaison for digital & technology projects within the Sodexo Group.” Agile application development; GDPR; able to speak French “a plus.”