Case Studies

This blog is contributed by Jennifer Schmidt | Founder of J. Schmidt Consulting | 10+ years’ experience in HR and expert panelist for the International Institute for Analytics (IIA)

Does it Matter Who the Chief Analytics Officer Reports To?

There are many options for where to have your analytics leader report. Similar to a Chief Data Officer, it is common for a Chief Analytics Officer (CAO) to report to the CEO or the CIO (Chief Information Officer). However, many organizations have set up their analytics teams to report through Strategy, Finance, Marketing, or Operations.So, which one is right? Which structure should your organization adopt to realize the most value from your analytics team? There are many complexities to consider and no one right answer. It’s important to note that wherever the analytics team reports will have an impact. As you would expect, the focus on your analytics team will follow the focus of the leader.

Nothing is set in stone. In fact, the most progressive organizations are agile and willing to change the reporting structure based on changing needs. It may make sense to have your analytics team report initially to Marketing or a specific line of business. But as your analytics team grows and becomes more important to the company, it may be appropriate to have that function report directly to the CEO.Here are some factors that I recommend you consider when determining where analytics should report within your organization:

• The amount of clarity in your company’s overall strategic priorities and the greatest perceived benefit from enhancing analytic capabilities in your organization.
• The department with the most momentum and utilization of analytics (it may be Marketing, Pricing, or Finance).
• The talent and capabilities that already exist across the business unit.
• The level of analytics maturity in your organization and the appetite for cross-functional projects.
• The culture and history of your departments’ ability to share best practices and work together, regardless of reporting hierarchy.

Regardless of reporting structure, I believe in implementing alternative methods to drive collaboration and work in your organization. Funding structures, performance goals, compensation programs, development plans, communication strategies, and culture all play a part in the success of adopting analytics in any organization.I have found that analytics teams within organizations report to a variety of departments from the CEO to IT, Strategy, and Marketing. For now, there appears to be little consistency in the industry and no “right” answer with respect to best practices. However, the success of the position and the focus of the analytics team is greatly impacted by its reporting structure within an organization. This requires careful consideration and a holistic view of all alternatives, beyond the reporting structure, to drive results and ensure that whatever decision is made is correct for your organization.

About Jennifer Schmidt

Jennifer Schmidt, founder of J. Schmidt Consulting, partners with organizations to provide consulting services on designing analytics talent strategies, organizational structures, and capability development plans, as well as working with firms to develop their analytics leadership talent. She also works with analytics leaders and quantitative professionals on topics such as advancing their careers, leading analytics teams, providing value to citizen data scientists and business leaders, and building partnerships to improve technical knowledge and effectiveness.This can focus on issues ranging from improving the visibility of the analytics team across business units and its ability to deliver results, to improving the team’s ability to communicate findings to executives and increasing the adoption rate of the analytics models it develops.This blog is reposted with permission, original here.