By Robert Gothan
In today’s digital economy, having a strong IT infrastructure is crucial, not only to a business’ bottom line, but also to ensure that it retains its competitive advantage. As such, CIOs are no longer just ‘technical directors’; they are stakeholders in almost every business decision.
With the rise of disruptive innovation impacting everyday business decisions, it is becoming far more difficult for other C-Suite executives to contribute the same strategic guidance that the CIO is able to offer. This is particularly true for the CFO, whose remit has narrowed from covering IT, HR and everything in between to just the finance function.
There is increased pressure for the CFO to be a strategic, executive presence in the boardroom, using data-driven insights to not only influence the firm’s growth and profitability, but also to ensure the firm’s actual existence in some cases.
This strategic requirement is muddying the waters, as data analysis used to sit firmly with the CIO. With palpable tension between these two roles, it has been difficult for both parties to form a partnership and create maximum value for the business. However, this will become even more crucial in today’s economic climate.
Calls for a stronger relationship between the CFO and CIO are the result of a shared interest. CIOs are realising that IT decisions need to be aligned with larger business goals, and as a result, collaboration between these two executives is vital.
There are potential blocks in the road, however. The difference in language between the CFO and CIO is cited as a reason why communication is a difficult process: one speaks the language of finance, and the other of technology. This, often coupled with opposing personalities, can make the challenge of understanding one another even more difficult.
For example, CIOs are often big-picture thinkers, wanting new and endless possibilities to boot. Conversely, CFOs usually value detailed plans, are logical, and want results-driven ideas. Whilst these archetypes are by no means true in all cases, it can still be useful for these executive roles to be aware of their differences and be mindful of these potential communication barriers.
In most organisations, the responsibilities assigned to both the CFO and CIO are designed to keep business operations running effectively, whilst also shaping the firm’s future growth. As such, there is a clear overlap and opportunity to work together more closely here.
The merging of technology and investment strategy has increased the need for a good working relationship between these executive roles. As CFOs mainly contribute to IT from a budgetary perspective, and CIOs from a strategic one, greater collaboration will be essential for businesses to keep their competitive edge.
For this reason, CFOs should consider implementing a ‘Business Partnering’ approach, where they work with the finance function to provide regular commercial and economic insights for the business to implement into wider company strategies. The current socio-political climate is just one example of an opportunity for today’s CFOs to add value and provide the board with guidance or how to plan, budget and forecast for any future volatility.
This approach will allow these two boardroom heavyweights to speak the same strategic language, and help to lessen any tension between them and their respective departments. Ultimately, the relationship between the CFO and CIO will have a direct correlation with a company’s success, so it is vital for them to collaborate and provide high level ideas to propel the business forward in today’s digital world.
Robert Gothan is CEO and founder of Accountagility