Leadership

CIO vs CFO: Five ways to ensure the IT leader role wins out

Even though many finance chiefs seem to think the days of the CIO role may be numbered, IT leaders still have a number of options to strengthen their hand.

The headline figures make grim reading for IT professionals hoping to build a long-term career as a CIO. Almost one in five CFOs thinks the CIO role will disappear within five years, according to new research.

Worse, the survey of 203 key financial decision-makers by IT specialist Getronics and consultancy Loudhouse suggests 43 per cent of CFOs believe the IT leadership role will inevitably merge with the top finance position.

So, how can CIOs ensure their role does not become redundant? Here are five top tips from IT leaders and finance chiefs.

1. Build relationships and always think about value

Karl Howarth is CFO at P&O Ferries and he recently took additional responsibility for IT at the organisation. He says more finance chiefs are becoming involved in technology because IT projects often underachieve.

"The business is keen to get more flexibility and quicker implementation timescales, so that business priorities can be met," he says. "The days of big IT change programmes have come to an end. Many are not successful in terms of delivery and their relevance, by the time of implementation, is limited."

The Getronics research suggests as many as 64 per cent of CFOs are concerned about the cost of maintaining an IT infrastructure. And 28 per cent of CFOs cite the poor relationship between IT and finance as the reason why return on investment (ROI) is difficult to evaluate.

"Technology projects often encompass the whole of the business and allocating ROI to a particular line can be complicated," says Howarth, who hopes the increasing collaboration between CIOs and CFOs will bring strong results. "There's a coming-together in terms of IT and finance strategy - and if your CIO isn't strategic, your business has got a problem."

2. Concentrate on proving the art of the possible

Like Howarth at P&O, Patricio Colombo, head of IT for Jamie Oliver restaurants, believes the implementation time for IT projects continues to fall - and the good news, at least in terms of demands from the CFO, is that technology is now more closely aligned with organisational objectives.

"Everything we do in terms of IT has a business reason," he says. "All CIOs must work towards becoming more business-oriented. Technology leaders must recognise that IT is always a smaller cog within a much larger organisational project."

The onus, then, is to prove how specific IT trends - such as the cloud - might or might not help solve a particular business problem. Colombo says the technology team at Jamie Oliver works to explain the art of the possible, ensuring potential ideas for new IT are drawn from across the organisation.

"The focus now is on small, quickly delivered projects, whose affect on the business can be measured," says Colombo. "We want to deliver a set of required outcomes for the organisation. Our business units simply cannot afford to wait three years for a technology project to be implemented."

3. Build trust to show how IT can create great businesses

The research suggests 38 per cent of CFOs believe CIOs do not possess a good level of financial understanding. Yet some IT leaders are already focused on how technology can be used to help drive the corporate agenda - and Lukas Oberhuber, CTO at insurance specialist Simply Business, says he sees himself as a technologist with a strong interest in business.

"Things go wrong when IT doesn't listen," he says. "You can't build IT systems to solve business problems that do not exist. The increasing prevalence of agile methods of development, for example, is a recognition that business requirements for an IT project often change."

Oberhuber believes many finance chiefs see technology as a commodity whose cost to the business needs to be reduced. A concentration on value, rather than cost can help demonstrate the impact of good IT - and Oberhuber's organisation forms IT teams around specific business projects.

"Our CFO is focused on finance and by working together you build trust," he says. "We're dependent on successful technology, but IT is only there to help the business achieve other great things.

4. Focus on making a difference, not on your reporting line

"You've got to dabble where you can make a difference," says Trevor Hanna, CIO at Associated British Foods, who says successful CIOs avoid being pulled in too many directions. He says he actually feels sorry for many CFOs who have to deal with multiple issues beyond their control, such as economic uncertainty and the potential collapse of the euro.

Someone will still have to make a decision about buying IT and that person will be the individual who is best-placed to make a call, says Hanna. Most decisions, he says, are not made by one person in isolation but require a collective process that draws on as many experts as possible.

"Despite the hype of the cloud, it's not becoming easier to buy IT," says Hanna. "The cloud will have a place in the business of the future but, like outsourcing and software as a service, on-demand computing is not a panacea for all business technology concerns."

Technology can still have a bad reputation in the business. Hanna says the failure of IT to deal with key issues, such as legacy IT and big data, means it is unsurprising that more CFOs are getting involved in hardware and software. But, even when they do, CIOs should not be overly concerned: "Success is not about who you report to but how you get things done," says Hanna.

5. Work with other senior executives to meet business objectives

Claire Hossell is CFO at recommendation specialist Checkatrade.com and she says the web-based nature of the business means changes to the IT infrastructure always have an immediate impact. The firm relies on a bespoke technology platform and uses liaison specialists to ensure IT changes meet the broader business strategy.

"Technology is absolutely crucial to our business. It's core," says Hossell. "Our business model changes rapidly and we must act entrepreneurially. We spend a lot of time planning to make sure that we are in line with the demands of the market."

Hossell works alongside the IT leader and operations manager to ensure activities are interlinked and resources are not wasted. She says the closer a finance chief works with IT, the more likely he or she is to find a method of development that works for the business.

"Big IT implementations often don't work because business objectives change so quickly," she says. "We run smaller IT projects that help the organisation deal with the enhancements. We have continuous change."

About

Mark Samuels is a business journalist and editor at IT leadership organisation CIO Connect. He has written for various organisations, including the Economist Intelligence Unit, Guardian Government Computing and Times Higher Education.

5 comments
jbond1616
jbond1616

I had always wondered about this. I've had trouble keeping my IT position on and never was able to figure out why. I had a lot of trouble with the CFO lately.

John Bond | http://www.fieldingplumbing.com.au

Tony Hopkinson
Tony Hopkinson

The fact that the huge assumption implicit in your article is not mentioned suggests to me that you are the problem not the solution. Who says the CFO shouldn't "win"? From my experience, instead of playing for X bucks a hole, may be they should go for X projects per hole. Just as, if not more, likely to get it right. If you don't play golf feel free to cut cards or throw dice, or some such.

MyopicOne
MyopicOne

Smaller, more focused projects are a "real good idea" that avoids many of the risk variables of long term projects. IT is often their own worst enemy by hiding the true costs of doing business, so projected project costs and burn rates are often a figment of someone's wildest imagination - which leads to a weaker position for the CIO. I'm curious to know if IT departments reporting to finance are on average bigger, equal or smaller than the Finance department in terms of resources (people and $). I know of one case where an IT request for badly-needed resources was turned down simply because IT would then have had more staff than Finance.

Tony Hopkinson
Tony Hopkinson

There are no IT projects, but only business projects. Someone finally gets the bottom line. aog_z for CIO

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