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E X E C U T I V E G U I D E BUILDING A WINNING DATA STRATEGY MIT SLOAN MANAGEMENT REVIEW 2 of companies had appointed a CDO as of 2012, this percentage increased to a high of 67.9% by 2019 before falling back to 57.3% in 2020. Among major companies today, there is nearly universal acceptance that data-driven management is strongly preferable to the alternatives. In spite of the growing consensus and invest- ment levels, only half of organizations — exactly 50% — reported that they are managing data as a business asset. The advent of big-data solutions and a next gen- eration of data management capabilities — Hadoop, data lakes, DataOps, and modern data architectures — have been helpful but have not assured success- ful business adoption or outcomes. Technology does not appear to be a barrier or the problem. Only 9.1% of executives pointed to technology as the principal challenge to becoming data-driven. Albert Einstein is said to have remarked, "The world cannot be changed without changing our thinking." What is clear is that the greatest barrier to dat a success to day is business culture, not lagging technology. In fact, cultural factors — that is, people and process issues — were cited by 90% of executives as the principal obstacle that they face. It is not enough for companies to embrace modern data architectures, agile methodologies, and integrated business-data teams, or to establish centers of excellence to accelerate data initiatives, when only about 1 in 4 executives reported that their organization has successfully forged a data culture. Cultural change and business transformation must be adopted at all levels of an organization for data-driven management to be truly embraced. Having professionally engaged with scores of large organizations over the course of the past two decades, each at a varying stage of maturity, I have found that certain actions distinguish successful data-driven companies from those that continue to struggle. 1. Secure executive commitment, not just lip service. Executive commitment is essential to building a culture where data is central. Pay atten- tion to what companies do, not what they say. Most pay lip service to the criticality of data in their an- nual reports and company mission statements, but far fewer companies embody it in their DNA or in their day-to-day business practices. Some compa- nies, like Capital One and American Express, have a history of embedding data in all aspects of their business culture. For most legacy companies, how- ever, building a data culture remains a challenge. Companies that have overcome it instantiate data processes throughout their supply chains, from data production to data consumption. I have met with organizations that have proclaimed their commitment to creating a culture where data is a priority without making the necessary investments and following through on their proclamations in order to drive real change and data-driven business outcomes. Don't be one of them. 2. Expect to work hard, and forget about magic bullets. Companies that have succeeded in their data-driven efforts understand that forging a data culture is a relentless pursuit, and magic bullets and bromides do not deliver results. To borrow from Thomas Edison, becoming data- driven is 1% inspiration and 99% perspiration. I have s een to o many companies undertake big- bang, overly ambitious initiatives that fail over time. Start simple. Focus on key business questions. Tie data investments to business outcomes. Realizing quick wins enables organizations to build credibility and establish sustainable momentum. Companies such as Cigna, Nuveen, and Citizens Bank are embarking on long- term efforts to define use cases with strong business sponsorship. Companies that accept that there is no easy path to success fare best over time. 3. Establish realistic expectations, not unattainable goals. Only 28% of companies reported that the CDO role has been successfully established within their organization. Why is this? One reason is that many organizations have struggled to establish realistic and achievable objectives for the CDO. Data is an asset that flows across an organization, and managing data is therefore complex. CDOs must establish achievable expectations to ensure success. I was once asked by a business line president for a plan to make his organization data-driven within 90 days. Until organizations develop attainable goals, it will be impossible to achieve successful data outcomes. The greatest barrier to data success today is business culture, not lagging technology.