CIOs and CFOs often see themselves and act as enemies. And yes: in some areas, their goals might diverge. But a strong CFO-CIO relationship is the key to success in the digital world.
In a time of digital transformation it is paramount that the CIO-CFO relationship works well. After all, to achieve a functioning IT transformation, those two roles are central to making it happen. But in the past, and often still, this particular relationship is blighted with friction: the CFO keeping his/her eyes on the money, while the CIO feels hampered by endless financial restrictions.
The tension is perhaps even intensified by how we all, both in business and privately, depend more and more on technology, and that it has turned into an all-engulfing tsunami that nobody can stop. The CIO is likely better informed of the impending requirements, while the pressures on the CFO to keep costs down during a world-wide financial crisis remains a factor at every budget negotiation. And perhaps he/she isn’t absolutely sure what digital transformation entails anyway…
The good news is that it doesn’t have to be this way.
Where the hierarchy may be that the CIO is answerable to the CFO – and often his/her junior – he/she may make the CFO feel a little like a dinosaur in a rapidly changing world. And this is exactly the crux. Where the two may not be each other’s peer, they could be allies. In the words of Thomas Murray, CFO and VP for Dell EMC Europe Enterprise Sales Business: “For the CFO, the most obvious way to understand how a company can adapt to the new digital world is to get briefed by the CIO. And the CIO needs the buy-in of the CFO to realize IT transformation.”
Bask Iyer, CIO of Dell and VMware, points out that “our continual focus on keeping the lights on and hitting tighter financial targets distracts us from being entrepreneurial”. It’s almost the battle cry of the CIO. But what they both need is the entire executive team behind them to achieve a successful transformation. And one way to get everyone onboard is to identify the company’s goals in business terms and shape the IT transformation around that. This is not impossible as most executive boards see IT transformation as essential for maintaining their competitive edge and addressing the shifting demands of their customers.
Recent research shows that companies that succeed in IT transformation report the strongest competitive positions and growth — with gains in both sales and profits of 7% or more in the past year. This is a pretty strong argument to help stay focused in a financially challenging world.
As Thomas Murray puts it: “The modern CFO does not need super powers, he/she just needs to surround himself/herself with the right people and technologies.”