Data Transformation Is the CEO’s Business

Caterpillar’s CEO had a problem. Jim Umpleby had stepped into the chief executive role in 2017 with a vision of achieving more profitable growth by selling more services and parts to the company’s heavy-equipment customers. Because offering real-time fleet management information services and selling parts online would depend on digital technologies, he set up a new division called Cat Digital. But the division’s head soon had unwelcome news for Umpleby: The company didn’t know its customers well enough to deliver on its goal. Customer data was siloed, fragmented, and, in the case of secondhand equipment, often entirely lacking.  Once fixex, Caterpillar had grown its services revenue from $14 billion in 2016 to $24 billion in 2024.

That problem is one shared by countless leaders who see how digital can enable a growth strategy but are stymied by a legacy of fragmented, incomplete, and inconsistent data assets. They are frequently told that getting their data in order is a prerequisite for taking full advantage of new tools like artificial intelligence but too often see data transformation as an IT modernization project. They delegate the work to IT leaders and evaluate success based on cost, speed, and tool adoption. But when data is treated as IT infrastructure rather than as an enterprise asset, its impact is predictably limited. Companies that gain real value from their data actively involve the top management team in data transformation.

Caterpillar’s experience underscores a critical lesson: Data transformation is not a purely technical exercise. Top company leaders must set a goal for the transformation in terms of business outcomes; give executives responsibility for data; commit resources to building an enterprise data platform; give all stakeholders a voice in the transformation; and direct strategic investments that take advantage of new data capabilities including AI.

Every large organization today manages vast data assets, but few extract their full value. The difference lies in executive leadership. When CEOs talk about data in earnings calls, participate in governance discussions, and hold leaders accountable for data quality, the organization listens. In an era where competitive advantage increasingly depends on insight, integration, and intelligent automation, companies that treat data as chiefly the responsibility of the IT function will fall behind. Those that treat it as a corporate asset — and lead accordingly — will define the next decade of performance.