In the era of digital transformation, the relationship between the CIO and CFO has become more critical than ever. According to a recent report by Forbes Insights, 96% of senior executives see a close CIO/CFO collaboration as being critical to business success.
However, people who serve in these two key C-Suite executive roles don’t always see eye-to-eye. Many CIOs argue that CFOs do not understand the potential impact of major technological trends. On the other side, CFOs claim that CIOs cannot fully grasp the financial processes and implications within a business environment. If companies hope to gain a competitive edge, these roles should join forces and figure out ways to collaborate more effectively.
Below are five ways to help foster a more successful CIO/CFO relationship.
Offer mentorship. As mentioned above, one of CIOs’ top concerns about CFOs is their lack of technical understanding and intuition. Therefore, it’s important to create a mentoring relationship to help CFOs better understand the impact of technology even though it may not be their area of expertise. This enables the CFO to talk intelligently regarding technology and help build relevance to the organization.
Find balance. When it comes to IT, many times the discussion focuses on operational challenges rather than the positive impact IT is bringing to an organization. There must be a healthy balance of appreciation for the good things IT does to drive operational effectiveness along with dialogue on areas for improvement. This is especially important when things don’t go as planned and larger implementations are to blame. It’s also essential for both sides to hold the business accountable – sometimes operational issues can stem from people and processes as opposed to solely being systems related.
Be proactive. CIOs and CFOs must proactively drive technology innovation rather than wait for the business to explicitly ask for it. It’s important to explore their role and how technology can be a driver in achieving an organization’s goals. When both roles put their minds together, it’s easier to push ideas forward and better inform positive, innovative technology-related decisions.
Foster collaboration. CIO roles may be characterized as simply managing IT costs rather than focusing on innovative strategy. While the role of the CFO may be defined as more strategic, those CFOs are often criticized for their reluctance to commit to long-term investments. It’s helpful to foster collaboration and respect to present a unified front for the benefit of the business. It’s also critical to establish a common, shared language around business value that both leaders can embrace and promote.
Focus on the future. Develop a multi-year IT strategy and reassess it regularly. It is an important collaborative exercise, especially since the innovation cycles and time-to-market for buying new technology is increasingly complex and require extensive cross-functional team engagement.
As organizations continue their digital transformation journeys, CIOs and CFOs need to be on the same page sooner rather than later. Businesses that achieve this type of alignment will have a smoother transition as well as markedly higher probability of meeting and potentially exceeding their business goals in terms of growth, productivity and customer service.
Olivier joined Zebra in November 2016 with more than 25 years of experience in financial and executive leadership roles. Most recently, he served as CFO at Western Digital Corp., an industry-leading provider of storage technologies. In that role, Mr. Leonetti was responsible for all finance functions, including accounting, tax, treasury, financial planning and investor relations. Mr. Leonetti was instrumental in the completion and integration of Western Digital’s $16 billion acquisition of SanDisk Corp. He led a successful debt capital raise in conjunction with the transaction and helped the company achieve its synergy targets. Prior to Western Digital, Mr. Leonetti served as Vice President, Finance – Global Commercial Organization at Amgen, Inc., a global pharmaceutical company, where he facilitated the implementation of worldwide product development, commercial strategies and global restructuring programs. From 1997 to 2011, Mr. Leonetti served in various senior finance positions with increasing responsibility at Dell Inc., including as Vice President, Finance. Prior to Dell Inc., Mr. Leonetti served in various worldwide finance capacities with Lex Rac Service plc and Gillette Co. He received his MBA from the Institute of Business Management, Grenoble (I.A.E.), France and is a Chartered Certified Accountant obtained in England.