Professional services firms with an interest in technology, take note: The lines distinguishing one C-suite dweller from another are pretty damn blurred on the question of who enjoys — and deserves — authority over IT purchases. This makes it more important than ever that the CFO and CIO establish parameters around IT decisions at their firm.
All of this has come to increasing light with new research that reveals a powerful lack of faith among CFOs for the CIOs with whom they share an executive bathroom.
Mistrust of CIO and IT Palpable
A recent study undertaken by Gartner in conjunction with professional organization Financial Executives International reveals that it’s the chief money guy who enjoys dominion over his organization’s IT department.
In turn, the CIO, the nominal head of the technology-furnishing wing of the company, is relegated to a less-empowered role. The CIO is rendered impotent by a CFO whose outright mistrust of his IT-equipped colleague and the team that assembles beneath him, is palpable.
The survey, undertaken with 344 North American CFOs whose companies are engaged in financial services, healthcare and other professional fields, exposes a broad-based dissatisfaction among CFOs with the IT-spending and application activity inside their firms.
CFOs Dissatisfied with IT Service Levels
Indeed, a mere 18% of responding CFOs believe their “IT service levels meet or exceed business expectations.” Further, just ¼ express confidence in their IT departments’ “organizational and technical flexibility to respond to changing business priorities,” and ability “to deliver against the enterprise/business unit strategy.”
Even fewer financial chiefs believe their IT departments “deliver the technology innovation needed by business,” or have “the right mix of skilled people to meet business needs.” Only 35% of CFOs regard IT as a strategic driver of business performance.
Alas and alack.
The report lends credence to the mounting impression that CFOs wield more influence over their organizations’ IT-based activities than ever. Meaning, this news could be troubling for companies that might gain more corporate efficiencies from clever technology purchases and implementations. In other words, the CFO’s natural interest in spending company dollars as frugally as possible could have damaging implications on the firm’s overall performance.
Currently, the survey shows 42% of IT departments now report directly to their CFOs, and 26% say their CFO alone authorizes IT investment in their firm. It’s a startling figure considering that just 18% copped to the same thing last year. Only 11% of respondents work at companies in which the CIO has the sole responsibility for filling their toolbox.
With technology investments so tightly linked to a company’s success, it’s desirable for the CFO to have a hand in developing IT’s roadmap. But the carriage is a two-seater, and the opportunity for more than one C-suiter to handle the reins is considerable.
Can’t We All Work Together?
Ideally, the CIO and CFO would work in tandem toward maximizing IT purchases while paying adequate mind to the realities of their business environment.
The CIO would provide clear data on the strategic wisdom of IT purchases, taking care to spell out the long-term benefits of deploying technology today whose rewards might not be reaped until tomorrow.
The CFO, in turn, would enlighten his technologically-grounded cohort on the economic realities in which the lot of them mutually operate, and encourage a wider appreciation among the techies for whether some cool new toy actually has a place inside the company’s overall mission.
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