Guangdong Province is the first in China to pilot the Chief Data Officer system in its government departments and bureaus. In this article, we take Shenzhen as an example to demonstrate the role of the Chief Data Officer, elaborate on the responsibilities of the Chief Data Officer, and point out the implications that companies can pay attention to from the implementation of this pilot program.
On May 14, 2021, the Guangdong municipal government released the Notice on the Pilot Work Plan for Chief Data Officer System in Guangdong, deciding to explore and pilot the Chief Data Officer (CDO) system in six provincial bureaus and 10 cities at the prefectural level or above of Guangdong.
This pilot program is the first of its kind in China.
The six provincial bureaus include the Provincial Public Security Bureau, the Provincial Human Resources and Social Security Bureau, the Provincial Natural Resources Bureau, the Provincial Ecology and Environment Bureau, the Medical Insurance Bureau, and the local financial supervision bureau.
The 10 cities include Guangzhou, Shenzhen, Zhuhai, Foshan, Shaoguan, Heyuan, Zhongshan, Jiangmen, Maoming, and Zhaoqing. In principle, each prefectural city should pilot the CDO system in at least three county level bureaus and five prefectural level bureaus.
By far, five cities, including Guangzhou, Shenzhen, Zhuhai, Maoming, and Heyuan, have disclosed their implementation plans for piloting the CDO system. For example, on August 9, 2021, Shenzhen municipal government released the Pilot Implementation Plan for Chief Data Officer System in Shenzhen (Shenzhen’s Pilot Plan).
As the details of the pilot programs for trial of different models might vary from city to city, in this article, we would like to focus on Shenzhen as an example to walk you through how the CDO system works.
Who is the Chief Data Officer and what responsibilities are assigned to this role?
The role of the Chief Data Officer (CDO) is to be distinguished from the Chief Digital Officer despite their similar abbreviation. The Chief Data Officer – referred to in this article subsequently as CDO – is a senior executive responsible for the utilization and governance of data across the organization, including:
- Overseeing data management, data analytics, and data governance;
- Ensuring data quality; and
- Creating data sharing and protection strategy.
The CDO is a widely appointed role, especially in large size companies, such as Fortune 1000 companies.
In the commercial environment, the CDO’s responsibilities usually focus on the data itself, examining this data and utilizing it to obtain insights to better support the business; in short, the role requires good data analysis and management. Data science and business analytics sometimes fall into the work scope of the CDO as well.
There might be some interactions between the duties of the CDO and the CIO (Chief Information Officer) – but there are obvious difference and boundaries to the respective roles.
For example, the CIO is responsible for the IT infrastructure for hosting and processing data in an efficient and safe way, while the CDO is responsible for the data management inside the organization’s IT systems, making sure that good quality data is accumulated and analyzing it to get more information.
To use a metaphor – it is akin to the CIO building a pipeline with the right size and security measures for water to be safely transported but it is the CDO who makes sure that the water is clean and used for the right purposes (in our analysis, to further business growth).
Shenzhen’s Pilot Plan has further clarified the CDO’s responsibility to include:
- Promoting the development of smart cities and digital governments.
- Improving standardized data management – promoting the implementation of the Shenzhen Data Regulation and the establishment of data rules, such as data classification and data trading.
- Promoting the innovative application of data convergence – promoting data sharing, openness, development, and utilization and promoting in-depth integration of public data with social data and the innovation in data application scenarios.
- Guiding and supervising data management work.
- Providing data management and security training to the team.
- Exploring the application of data with different focuses – Futian District of Shenzhen will focus on utilizing public data resources to support Shenzhen-Hong Kong technology innovation cooperation; Nanshan District will focus on improving data security supervision and warning capability; Baoan District will focus on utilizing data in social governance; and Pingshan District will promote the experience of CIO and Chief Privacy Officer (CPO).
Why does the Shenzhen government need a CDO?
Though the role of the CDO is becoming more popular among companies in China, it is definitely a “new development” for the Chinese government. So why does Shenzhen want to establish the CDO system now?
Based on our observations, the below factors should be considered:
“Data” as a factor of production and Shenzhen as the “test field” – data has been defined as another factor of production by the Chinese central government and the revolution and innovation on data usage is already strongly encouraged in this city. Under this top-level strategy, Shenzhen being the pioneer of the “reform and opening up test field” in China, it is not surprising that its government has taken up the task. In the era of the “digital economy”, the experience in data utilization will be highly beneficial for the country’s overall economy development.
Smart city and digital government – Shenzhen has been the pioneer in the area of digital government and has simplified business processes and civil affairs to a large extent. With the support of giants in the information and communication technology (ICT) industry like Huawei and Tencent, Shenzhen has also become a good example of a smart city. And, to function as a smart city, which necessarily requires digital governance, operating based on a large scale of data is the foundation.
To gauge the data flow between different government units or utility companies and avoid data duplication (which usually means duplicate investment in IT systems) requires high-level coordination and universal strategy. Therefore, the introduction of a senior position like the CDO is the right thing to do at this time.
Eliminate the “information island” – Shenzhen has made great progress on data utilization and sharing. The Shenzhen Municipal Government Data Open Platform provides a large number of public data interfaces (a total of 2425 data interfaces, which includes 1242 city-level data interfaces and 1183 district-level data interfaces).
However, the “information island” situation still exists in government units this means data is saved in a place without sharing with other parties, which in turn reduces the value of that data and increases the occurrence of duplicated data as other parties need to collect / save the same data as well. There are still “data barriers” to be removed to maximize the value of data. Therefore, more power could be granted to the CDO – in principle, the CDO role should be played by the deputy or chief leader of the government or department who is in charge of digital government construction work.
Better data protection and sharing – with the newly announced Personal Information Protection Law (PIPL), alongside with other two laws, the Data Security Law (DSL) and the Cyber Security Law (CSL), China has built its own unique legal realm of information security and privacy. As the body holding and processing large scale of public data, it’s not surprising for the Shenzhen Municipal Government to take more actions on how to protect the data collected and processed.
Overall, the plan aims to improve the public data sharing and coordination mechanism, strengthen the development and utilization of public data, promote the deep integration of public data and private data, and accelerate the cultivation of data factor market. The plan proposes to carry out research on data application innovation, and push for the implementation of application scenarios in key areas.
What are the implications for companies in China?
In short, opportunities for the professional services industry in specialized roles.
Once the CDO pilot program is finalized, the scope of the CDO application might further expand to all government units, even the state-owned companies or public service units, such as schools. The appointment of the CDO will become more popular.
This will trigger the large demand for relevant professionals who can provide support to the CDO, or the demand for outsourced services from professional agencies. In the case of PingShan District, the Chief Privacy Officer was appointed inside the government while the chief privacy advisor is played by an external expert. From this perspective, the CDO system actually offers a great opportunity for professionals and services agencies in the privacy and security industry.
On the other hand, considering the importance of data utilization in supporting the company’s businesses, along with the increasingly complex compliance requirements, we encourage companies to take similar action (as the government) on adopting the CDO system for better data utilization and protection. In fact, the move to put in place the CDO system in government departments offers a good example and could encourage more companies to catch up the pace in terms of fully optimizing their data management and information systems.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done so since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at firstname.lastname@example.org.
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