Organisations will increasingly come to rely on data to make informed decisions as they embrace the new mode of remote work with digital operations. Adoption of advanced technologies such as AI & machine learning, and blockchain will only further amplify the importance of CDOs.
According to PwC’s second Chief Data Officers (CDO) Study, 6% of companies in Hong Kong utilise the position of a CDO in 2022, as the city commits to harnessing the power of data in its pursuit of innovation and global competitiveness.
Since PwC launched its ﬁrst CDO study in 2021, the role of the CDO has rapidly gained prominence across the globe, with 27% of leading firms having a CDO in place in 2022. In Asia-Pacific, the number of companies with a CDO increased from 6% in 2021 to 9% in 2022. As the role continues to evolve, it will be essential for organisations to recognise the value of a strong CDO and invest in the development of their data.
James Lee, PwC Hong Kong Data, AI and Emerging Technology Consulting Leader, said: “The rise of the CDO can be attributed to several factors, including increasing regulatory requirements, growing data volumes and complexity, and the drive for competitive advantage. Hong Kong's companies, especially financial institutions must comply with a complex web of local and global regulations, which require the collection, analysis, and reporting of vast amounts of data. Consequently, dedicated data officers are more needed than ever. As companies in Hong Kong invest in their data capabilities and seek leadership from experienced data professionals, the importance of the CDO role continues to grow.”
The presence of a CDO appears correlated with strong ﬁnancial performance. Despite a downturn in the economy due to COVID-19, organisations with CDOs had a less impactful decline in revenue growth with an average of 7%, 10% less than organisations that had no such position. For three-quarters of industries, organisations with a CDO record a minimum 5% improvement in net revenue growth rates compared with organisations with no similar role in place. For some industries—utilities, real estate, and energy—the difference was as high as 25%.
CDOs face a unique set of challenges, including data privacy and security, talent shortage, as well as data silos and integration issues. In Hong Kong, one of the biggest challenges is to nurture and improve data literacy across an organisation, creating a data driven culture for decision making. Additionally, the protection of sensitive data is a top priority, with ongoing increases in cybersecurity threats, such as ransomware attacks. Further, as the demand for data professionals continues to outpace supply, CDOs in Hong Kong often struggle to build, train, and retain skilled data teams. The rapid development of new technology such as Data Lakes, AI & Machine Learning, and Customer Data Platforms have caused a huge demand for data related talent.
Looking ahead, organisations will increasingly come to rely on data to make informed decisions as they embrace the new mode of remote work with digital operations. Adoption of advanced technologies such as AI & machine learning, and blockchain will only further amplify the importance of CDOs.
Mike Li, PwC Hong Kong Partner, noted: “We expect that the popularity of the CDO role will continue to gain traction, while remaining critical to organisational success. We also anticipate the role will take on an increased focus, incorporating data governance. As data becomes more central to an organisation’s business strategy, there will be a core need for data governance practices such as data quality, security, and compliance. CDOs can and will play a key role as part of Data Governance Committees in driving influential data initiatives.”