The 2019 Chief Digital Officer Study Global Findings PwC March 2019
Company demographics 2
CDO growth slowed down: 21% of all companies have a CDO in place Percentage of CDOs 1) 2018 21% 2016 19% 2014 6% 1) Sample size: 2018 n= 2,500; 2016 n=2,500; 2014 n=1,500. Source: 2019 CDO Study 3
Following the global trend, CDO growth slowed down in all regions Companies with CDOs by region Asia-Pacific 2% 7% 10% Europe 9% 34% 39% EMEA 1) 8% 38% 38% North America 6% 23% 23% South and Latin America 3% 13% 18% 2018 2016 2014 1) EMEA includes Europe, the Middle East and Africa. For further information on sample sizes see the methodology section. Source: 2019 CDO Study 4
In the Asia-Pacific region, Australia has the highest CDO ratio 1) Companies in Asia-Pacific with CDOs Top 5 countries Australia Malaysia 30% 39% Australia 9% 39% 40% India Thailand Japan South Korea Taiwan 9% 6% 6% 17% 29% Malaysia India Thailand 0% 0% 4% 19% 20% 17% 19% 30% 29% Hong Kong China 3% 1% South and Latin America 1% 9% 7% 2018 2016 2014 1) Only countries with a sample size of 20 companies are considered. Source: 2019 CDO Study 5
All European countries record a growth in CDOs 1) Companies in Europe with CDOs Top 5 countries France Germany 48% 66% France 19% 66% 62% Netherlands Great Britain 45% 44% Germany 8% 39% 48% Switzerland Denmark 38% 35% Netherlands 0% 32% 45% Spain Sweden 28% 32% Great Britain 20% 35% 44% Italy Russia 11% 22% Switzerland 4% 38% 33% 2018 2016 2014 1) Only countries with a sample size of 20 companies are considered. Source: 2019 CDO Study 6
European countries are leading the pack 1) Companies in Asia-Pacific with CDOs Companies in Europe with CDOs Australia Malaysia India Thailand Japan South Korea Taiwan Hong Kong China 2% 0% 3% 0% 1% 0% 9% 7% 6% 6% 19% 20% 17% 19% 30% 29% 39% 40% France Germany Netherlands Great Britain Switzerland Denmark Spain Sweden Italy Russia 0% 6% 11% 48% 39% 45% 32% 44% 35% 38% 33% 35% 32% 33% 28% 21% 22% 23% 66% 62% 2018 2016 1) Only countries with a sample size of 20 companies are considered. Source: 2019 CDO Study 7
Companies in financial services and entertainment industries have the highest CDO ratio Percentage of companies with CDOs by industry 1) Insurance 41% Banking 32% Communications/Media/Entertainment 30% Consumer Products/Retail/Wholesale 27% Food/Beverages/Agriculture Pharma/Health/Chemicals 21% 21% Automotive/Engineering/Machinery 19% Metals and Mining Transport/Travel/Tourism Utilities/Oil/Gas Other 16% 15% 14% 14% Technology/Electronics 13% CDO ratio in 2018 1) Sample size of all companies = 2,500. For further information on sample sizes see slide 30. Source: 2019 CDO Study 8
This trend didn t change when looking at 3 years of data Percentage of companies with CDOs by industry 1) 41% Insurance 35% 8% 32% Banking 27% 7% Communications/ Media/Entertainment 13% 28% 30% Consumer Products/ Retail/Wholesale 9% 27% 27% Food/Beverages/ Agriculture 11% 21% 23% 2018 2016 2014 1) Sample size of all companies = 2,500. For further information on sample sizes see the methodology section. Source: 2019 CDO Study 9
In 2016, hiring CDOs reached the peak Number of CDOs hired over time 63% 145 160 124 75 47 54 8 2013 2014 2015 2016 2017 No. of CDOs hired that year 2018 N/A Source: 2019 CDO Study 10
Individual CDO demographics 11
54% of CDOs are C-Suite members: Digital transformation becomes an integral part of the business strategy 1)2) 2014 2016 2018 27,0% 24,2% 17,6% 41,9% 40,0% 17,4% 53,5% 15,1% 18,7% 16,3% 17,1% 11,5% C-level Director Vice President 1) Sample size: 2018 n=536; 2016: n=475; 2014: n= 86. 2) Titles vary based on company. Source: 2019 CDO Study 12 Other
The number of CDOs with technology background has significantly increased in 2018 1) 2014 2016 2018 12,8% 14,0% 7,6% 12,9% 20,6% 19,7% 32,4% 28,4% 40,9% 53,5% 39,4% 17,9% Consulting, Strategy & Business Development Technology Marketing, Sales, Customer Service Others 1) Sample size: 2018: n=536; 2016: n=475; 2014: n=86. Source: 2019 CDO Study 13
Technology and Consulting, Strategy & Business Development backgrounds are dominant throughout the industries CDOs by background and industry 1) Banking 42,7% 27,3% 16,4% 13,6% Number of total companies by industry 110 Consumer Products/Retail/Wholesale 37,1% 22,6% 33,9% 6,5% 62 Pharma/Health/Chemicals 41,9% 22,6% 17,7% 17,7% 62 Insurance 38,3% 29,8% 17,0% 14,9% 47 Communications/Media/Entertainment 28,9% 42,2% 20,0% 8,9% 45 Technology/Electronics 32,5% 35,0% 25,0% 7,5% 40 Automotive/Engineering/Machinery 47,2% 30,6% 8,3% 13,9% 36 Utilities/Oil/Gas 52,8% 27,8% 8,3% 11,1% 36 Food/Beverages/Agriculture 32,0% 32,0% 24,0% 12,0% 25 Transport/Travel/Tourism 52,4% 28,6% 4.8% 14,3% 21 Metals and Mining 46,2% 15,4% 7,7% 30,8% 13 Other 46,2% 25,6% 12,8% 15,4% 39 Consulting, Strategy & Business Development Technology Marketing, Sales, Customer Service Others 1) Sample size: 2018 n=536. Source: 2019 CDO Study 14
External and internal hires vary by industry External vs. internal hires in percentage by industry 1) Number of companies by industry Banking 51,8% 46,4% 1,8% 110 Consumer Products/Retail/Wholesale 45,2% 51,6% 3,2% 62 Pharma/Health/Chemicals 46,8% 51,6% 1,6% 62 Insurance 42,6% 51,1% 6,4% 47 Communications/Media/Entertainment 55,6% 44,4% 0,0% 45 Technology/Electronics 52,5% 45,0% 2,5% 40 Utilities/Oil/Gas 58,3% 38,9% 2,8% 36 Automotive/Engineering/Machinery 50,0% 44,4% 5,6% 36 Food/Beverages/Agriculture 60,0% 40,0% 0,0% 25 Transport/Travel/Tourism 23,8% 71,4% 4,8% 21 Metals and Mining 30,8% 61,5% 7,7% 13 Other 38,5% 56,4% 5,1% 39 Internal External N/A 1) Sample size: 2018 n=536. Source: 2019 CDO Study 15
Compared to the last 4 years, less women are in C-Level CDO positions 1) 2014 2016 2018 17,0% 16,0% 14,5% 83,0% 84,0% 85,5% Male Female 1) Sample size: 2018 n=536; 2016: n=475; 2014: n=86. Source: 2019 CDO Study 16
Methodology 17
Methodology Definition of a Chief Digital Officer In this study, the Chief Digital Officer (CDO) is defined as an executive, whose responsibility is to develop and implement the company s digital strategy. Independent of the title set by the firm, the function of a CDO is to lead the company throughout its cross-functional transformation to a digital enabled enterprise. Population (n = 2,500) Global top 2,500 listed companies by market cap as of March 31 st, 2018 Holding companies without operating business excluded Source for ranking Bloomberg Sources to identify CDOs or equivalents Company/ Executive directories: Thomson Reuters, BoardEx Corporate homepages Business network platforms: LinkedIn, Xing Customized classifications for Industry segments Geographic region CDO background Company market cap Press databases: Factiva Internet search 2016 CDO Study applied the same methodology. 2014 CDO Study looked at the 1.500 biggest listed and private companies by revenue. Source: 2019 CDO Study 18
Structure and characteristics of companies observed Industry Count % Banking 348 13,9 Technology 249 10,0 Pharma and Health 195 7,8 Oil and Gas 126 5,0 Utilities 124 5,0 Insurance 114 4,6 Retail 112 4,5 Food and Beverages 112 4,5 Consumer Products 108 4,3 Chemicals 96 3,8 Transportation 92 3,7 Real Estate 82 3,3 Machinery 82 3,3 Metals and Mining 81 3,2 Communications 81 3,2 Automotive 81 3,2 Professional Services 71 2,8 Media and Entertainment 67 2,7 Electronics 61 2,4 Other 57 2,3 Building Construction 55 2,2 Travel and Tourism 45 1,8 Engineering 28 1,1 Pulp and Paper 20 0,8 Wholesale 7 0,3 Agriculture 6 0,2 Grand total 2,500 100 Region Count % Asia-Pacific 977 39 EMEA 641 26 North America 806 32 South & Latin America 76 3 Grand total 2,500 100 Quartile Market Cap Count 4 $24B $850B 625 3 $12B $24B 625 2 $8B $12B 625 1 $5B $8B 625 Grand total 2,500 19