Business leaders are moving quickly to build new revenue management strategies to help improve their bottom lines throughout the pandemic. Chief information officers and chief financial officers are being showcased in this initiative.
IT spending is projected to reach $4T in 2021 according to Gartner, including a larger spend on devices and enterprise software as businesses continue to invest in comfortable and productive workforce environments. CFOs and CIOs sometimes differ in spending execution as CFOs look to reduce costs. However, both share the same goals of maximizing the value of their investments and optimizing key costs.
Looking ahead toward the next six to 12 months, what are some key practices and trends in business today that depend on both CIOs and CFOs to achieve tomorrow’s corporate goals?
IT Investment and the Corporate Agenda
IT investment has quickly shifted up the finance leaders’ agenda and is a key budget priority. The pandemic forced huge portions of the population to adopt remote working. For businesses, this means increased need for IT infrastructure and IT has therefore risen sharply on the finance leader’s agenda.
Collectively around our business environments, IT investment continues to move toward the top of the agenda. This remains a budget priority for 2021 when improving capital, payroll, operating (non-IT), marketing, sales, production, product support and more.
Moving forward, both CIOs and CFOs are expanding their direct responsibilities, taking a more hands-on approach to lessen the various disruptions caused by the crisis. This includes maximizing budgets and highlighting the value of investment in new technologies. For example, many executives of SME companies in financial services are making decisions to use new investments like cloud-based productivity to enhance collaboration tools and flexible working.
Cloud Computing Is the Future
IT leaders have turned in droves to cloud computing over the past year, and cloud was one of a few areas in which investment grew in 2020.
Throughout the pandemic, CIOs needed to work with CFOs to get remote infrastructure in place, such as business communications systems. Even though some financial distress has alleviated in 2021, company budgets are still under pressure and remote capabilities still heavily relied on, so flexible cloud investment will continue to be a top focus for achieving success. With volatility and remote working expected to continue for the foreseeable future, cloud computing will be seen as a crucial part of any businesses’ strategy and continue to attract investment.
Companies in the food manufacturing industry are implementing global cloud ERP strategies across their bandwidth of assets to broaden their connectivity, which involves additional financial investment. CFOs need to understand that knowledge currency is essential to efficiently manage IT investments and that it is an incredibly broad subject. This is equally evident in the food manufacturing sector. The basics continue to dominate given that procurement principles can be applied in a complex environment and drive efficiencies in technology spend. Cloud investing can be a complex area of investment, but the application of rudimentary principles can still yield great outcomes to manage CIO’s budgets.
Cybersecurity Remains a Heavy Priority
Investing in cybersecurity for better protection against outside threats has been one of the key trends of the last year. Cyber risks will inevitably continue and has been reinforced by the recent ransomware surge. Recently, companies like JBS USA, the world's largest meat supplier, have been targeted with organized cybersecurity attacks -- forcing companies to close their facilities, pausing all business orders and interrupting ongoing transactions.
As these breaches continue to occur, companies are drastically looking to replenish and invest in the most valuable cybersecurity assets on the market -- experts in IT and software engineering. The US Bureau of Labor Statistics projects "information security analyst" will be the 10th fastest growing occupation over the next decade, with an employment growth rate of 31% compared to the 4% average growth rate for all occupations.
CFOs will want to support their CIOs with a complete inventory of all IT assets and strategies, both human and machine. As COVID-19 has shown us, a key measurement any successful cybersecurity practice is adaptability. Circumstances can change drastically at any time, and companies have to be equipped to respond.
To achieve common goals for any business, the bridge between financing corporate assets and protecting them must be balanced, which start from the C-suite. Maximizing the value of their investments and optimizing key costs will always be the main goals of business formulas. Moving forward in a post-pandemic world, CIOs and CFOs must know the complexities that businesses are dealing with today (remote work, cyber threats and cloud investment) were formulated to keep improving for a better tomorrow.
Andy Wood is an experienced and highly qualified technology vice president with a track record of delivery of complex IT procurement initiatives. He has extensive strategic experience across a variety of sectors and has operated within high change environments as both an IT category and functional leader. Andy runs procurement functions and oversees complex change projects. With a career history spanning US, Europe and UK, Andy has consistently delivered savings and sustainable IT procurement outcomes for many companies.