Why CFOs Call the Shots in IT Decisions



The top IT decision-maker for many companies is not the chief information officer. The chief financial officer is increasingly calling the shots for IT.

The CFO has become the top technology decision maker in around half of businesses, according to Gartner research released in June, 2011, which is entitled: “Financial Executives International (FEI) Technology Study.”

In fact, more IT departments are overseen by the CFO, not the chief executive or other senior managers. True, CIOs should learn how to get more respect in the C-suite. But for the CFO to call all the shots in IT decisions is ill-advised, and I’ll explain later.

ID-100123176 imagerymajesticThe study’s conclusions:

— 42 percent report to the CFO

— 45 percent IT investment strategies made by the CFO

— In 38 percent, the IT department is managed by the CFO

— In 7 percent, the CFO is the lone decision-maker

“Understand that the CFO views the impact on business process and business enablement as the top technology issues,” said Gartner analyst John Van Decker.

“Therefore, applications and analytics are the top investment priorities, and the enabling technologies that support these initiatives need to be viewed as equally important,” he added.

The study also indicated that analytics and applications are the No. 1 investment priorities by the CFO.

While this trend probably makes financial executives happy, it doesn’t make for best practices.

It raises at least three questions:

— Do such CFOs have the necessary tech knowledge to understand the value of each decision? Sufficient steps have to be taken to ensure due diligence in IT security and other decisions.

— When will CEOs reconsider such strategies because of the negative impacts on the teamwork and morale of IT departments? An IT thought leader will resent such intrusions on the chain of command in organization structure.

— What will CIOs do about it? CIOs must take the proverbial bull by the horns to exert more leadership.

My bottom-line: Agreed, the CIO should adhere to all financial checks and balances. But there should be balance.

As with human resources management and marketing whom the chief people often aren’t sufficiently respected, in essence, the top IT decision-maker should be the chief information officer with input from the CFO and other managers.

From the Coach’s Corner, here’s related reading:

4 Keys So Marketing and IT Can Create Business Revenue — Businesses will generate more revenue if their information technology and marketing professionals strategize more effectively. For instance, success in e-commerce is increasingly challenging for companies that want to dominate in brand preference, customer loyalty and word-of-mouth advertising. A study shows Internet shoppers are more demanding in the three Cs — channels, choices and convenience.

4 Recommendations to Avoid Spending Too Much on IT — To take advantage of big cost savings in information technology, a study says businesses need to change their buying habits. Here’s how.   Despite an unprecedented trend to control information-technology costs, the majority of companies fail to achieve maximum savings, according to a multi-nation Forrester Consulting study.

Tech Trends: CFO’s the Boss, IT Departments Are Disappearing — Two developments are clearly underway in information technology. Increasingly, the chief financial officer is in charge and IT departments are shrinking in size. Here’s why.

Tech Planning: What If There’s Another Downturn? — Technology-research firm Gartner recommends in a study that chief information officers should get ready for another downturn. That requires planning.

Executives Target 5 Technology Threats to Company Value — Corporate executives see new strategic risks as a result of technological changes — from big data and cloud computing to social media  — according to a 2013 global Deloitte survey. Deloitte queried more than 300 executives, risk managers and board members — 81 percent said their strategic-management focus has evolved with technology.

Men are respectable only as they respect.”

-Ralph Waldo Emerson


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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.





Photo courtesy of imagerymajestic at www.freedigitalphotos.net


How CIOs Can Get More Respect in the C-Suite



Despite the importance of their work, chief information officers have difficulty earning respect from senior executives.

Ironically, information technology plays a vital role in an organization’s risk management and profits.

Two studies indicate there’s a widespread perception that IT pros need to get businesslike.

But CIOs are not alone.

Like many advertising and marketing professionals, CIOs face a glass ceiling because they’re not seen as management peers at the conference-room decision-making table.

Why?

Have you ever noticed that IT people do not take the lead in strategic initiatives?

They do not convey that they understand the big pictures facing their employers.

They appear to be too task-oriented.

They often project the image that they only follow what’s at the end of their nose and that they get immersed in minute details.

How can a CIO acquire all the necessary skills to fix the problem?

So, what a CIO needs is a vision of how their IT department can best-serve their employer, which involves creating revenue.

Businesses generate more revenue if their information technology and marketing professionals work together to strategize more effectively.

For instance, success in e-commerce is increasingly challenging for companies that want to dominate in brand preference, customer loyalty and word-of-mouth advertising. (See the 4 Keys So Marketing and IT Can Create Business Revenue.)

Earning C-suite respect also calls for taking the initiative – being ahead of the pack in emerging technology and applications that benefit or complement a company’s strategic plans, assessing options, communicating strategies, developing strong relationships in and out of the company, and possessing self-marketing skills.

This really starts by being able to listen and asking relevant open-ended questions. Have you ever noticed the most-powerful people in a room often do the most listening?

A personal investment of time is required. Develop a strong familiarity with every business unit in the organization. That includes operations, marketing, sales, finance and human resources.

This is accomplished by asking colleagues for information about issues, challenges and goals. One good method is to ask a different peer to go to lunch every week.

CIOs also need to read what CEOs read, learn how they think, and emulate their abilities to compartmentalize and synthesize events and information to develop objectives.

IT pros need to become known for effective teaching skills. A good educator becomes the go-to person in any organization.

This requires the ability to sell ideas and information – to be able to explain what data and what developments mean to the firm. This can lead to strong relationships, which are imperative for universal respect.

If all of this was so easy, everyone would be doing it. Chip away at learning these skills and you will be on your way to earning more respect in the C-Suite.

From the Coach’s Corner, here’s a myriad of links to articles with tips CIOs might wish to consider:

— Career Tips

— Management

— Leadership

— Human Resources

“It’s not a faith in technology. It’s faith in people.”
-Steve Jobs


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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional.Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.





Photo credit: www.mconnors.com


Tech Trends: CFO’s the Boss, IT Departments Are Disappearing



Two developments are clearly underway in information technology. Increasingly, the chief financial officer is in charge and IT departments are shrinking in size.

First, regarding the shrinking size of IT departments, a Corporate Executive Board study indicates they’re diminishing in size, according to writer Joe McKendrick  at SmartPlanet.com.

MH900422730 young business womanIt’s not a cutback in jobs, just a shift in how IT professionals are put to work. He writes companies are either are tapping IT service providers or clouds.

The study indicates IT department will be 75 percent smaller by 2015, and 80 percent of IT budgets will be spent on IT vendors’ services.

What’s driving this phenomenon?

Probably best-practices in consolidation as CFOs assume more authority.

A study by Gartner and Financial Executives Research Foundation (FERF) was based on the perspectives of senior finance managers.

It’s entitled, “2010 Gartner FEI Technology Study: The CFO as Technology Influencer.”

Findings include:

— Forty-two percent of IT departments report to CFOs

— Thirty-three percent are supervised by the chief executive officer

— Sixteen percent report to the chief operating officer

— Two percent are overseen by the chief administrative officer

— Seven percent to other executives

Most importantly, the CFO has a major say in 75 percent of IT departments and a minor input in 20 percent. In 5 percent, the CFO has no influence.

Why? Two studies indicate a need for IT pros to get businesslike.

“In most organizations, the CFO and CIO work together daily to finance IT and provide information that supports financial processes, but there is also an opportunity for them to form a powerful alliance that generates more value for the enterprise,” said Bill Sinnett, FERF’s director of research, in a statement.

“The CFO and CIO are well-positioned to work together at generating superior performance from the enterprise,” he added.

The  study makes it clear IT department personnel, especially the CIO, should understand an organization’s big picture and how they can best contribute to the  firm’s welfare via the CFO.

My Biz Coach conclusion from the two developments:  IT success hinges on acculturation with the finance mindset as well as a higher degree of integration with the rest of the organization. It’s different but it’s the wave of the future.

From the Coach’s Corner, related resource links:

Nervous About Your New Boss? Here’s How to Deal with ItWhether you just got a new job or whether your company just assigned a new boss for you, here’s how to develop poise and to manage your boss.

8 Tips on How to Ask Your Boss for a Pay Raise — Your food, gas and other living costs have increased. But you need tips on how to ask your boss for a pay raise. You’re mindful about the economy and that unemployment rates are high. With the exception of Wall Street, payroll budgets are constricted everywhere, and you haven’t had a raise recently. Here’s what to do.

The 22 Dos and Don’ts for Successful NegotiationsNo matter what you need to negotiate, there are easy strategies to get anything you want. But you must first remember it’s important to reach a fair compromise – with win-win negotiating skills.

9 Dos and Don’ts for Best Decision-making — The dos and don’ts for best decision-making are applicable in three ways: Whether you have difficulty making the best decisions, engage in self doubt after making one, or are gun shy because some of your decisions have failed you. To err is human.

“I wasn’t a financial pro, and I paid the price.”

-Ruth Handler


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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.






Seattle business consultant Terry Corbell provides high-performance management services and strategies.