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Tech Business: CFOs increasingly Calling IT Shots
CIO decisions no longer are getting a rubber stamp from the President or CEO. Gone are the days where CIO’s were trusted to set IT direction and budgets. IT is increasingly treated as a cost center that is closely scrutinized or controlled by finance.
A report by Gartner Inc. and the Financial Executives Research Foundation (FERF) found that 42 percent of IT organizations now report directly to the CFO. In 45 percent of organizations, the CFO plays the lead role in determining IT investment strategy, and in 26 percent of organization, IT budget decisions are made solely by the CFO.
This change of the lead role in IT decisions is a clear reason why top priority IT projects have a business focus. John Van Decker, Gartner analyst, said that you need to “understand that the CFO views the impact on business process and business enablement as the top technology issues. Therefore, applications and analytics are the top investment priorities, and the enabling technologies that support these initiatives need to be viewed as equally important.”
This reporting arrangement has the potential to be a good one, but it is dependent on either the CFO having a strong understanding of IT or for the CFO and CIO to have a good working relationship. Bill Sinnett, director of research at FERF, said that “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.”
