Often regarded as two separate domains, many CIOs and CFOs are finding themselves working closer than ever when it comes to technology initiatives. With IT costs on the rise, greater demand from both the board and the business to optimize costs and drive greater ROI of investment decisions, CFOs are extending their influence into the IT side of the business.
In a recent Censuswide survey of more than 1500 CFOs and CIOs in the EMEA region, the results of the changing dynamics between the key roles prove that a greater collaboration between the two can lead to greater business outcomes.
- Over 86% of leaders say that their working relationship has strengthened. This improved bond goes well beyond the “feel-good” benefit of getting along with your colleagues and can lead to tangible, positive results for the company.
- 43% of surveyed CFOs associate improved business outcomes to a good relationship with their CIO.
- 46% say the partnership contributed to improved outcomes, even if it wasn’t the main driver.
Focusing on Technology ROI
Delivering a strong ROI from business initiatives is ingrained in the genetic makeup of any good CFO, but it seems especially prevalent when it comes to IT, as only 19% of CFOs in the EMEA region are happy with the impact that technology investments make on their business. The percentage of satisfaction is lowest in the Nordics (15%) and highest in the Middle East (24%), but remains below 25% across EMEA.
Over the last three years, surveyed CFOs gained the least ROI from ERP upgrades or migrations and from mobility technologies (23% each). Looking closer, we can see which IT investments in each region left CFOs underwhelmed:
- Middle East: Shifting workloads to the cloud (24%)
- UK: Customer-facing SaaS technologies (20%)
- DACH: Employee remote work, emerging technologies (21% each)
- Israel: Internet of things, risk management and compliance (21 each%)
Meanwhile, the technology investment that provided the most value for CFOs is a concern that’s only likely to grow over time: Security technologies (27%). With the major financial and long-term business impact to the business that can be caused by security troubles, along with compliance and risk, this may be the principal reason for the strengthening of the CFO/CIO partnership (40%), and the main factor (27%) driving CFO investment decisions for 2024.
Taking a More Active Role
The dissatisfaction with past technology investments, combined with the need to continue innovating and addressing security, are likely strong motivators driving CFOs to take a more active role in IT decisions. And according to the survey, they are taking a lead role in many areas that previously have been the domain of the CIO:
- 56% of CFOs say they set IT project timing. In the UK it’s 62%, in Israel 66% and in France only 48%.
- 56% say they’re responsible for setting expected IT business results. The number is lowest in France at 47% and highest in Israel at 66%.
- 58% take charge of setting technology investment budget levels. The UK had the highest percentage at 63%.
As CFOs get more involved in technology investments, keeping in mind that they’re stepping into the CIO “sandbox” and being respectful of the many complex challenges IT leaders face can ensure CFOs take the right approach to continue improving the CFO/CIO relationship:
- Share aligned goals in IT spending and investments. It can result in lower cost solutions and technology investments that could lead to optimal returns for the business.
- Ensure clearly defined roles and responsibilities. This can help to avoid conflicts over IT control and decision-making authority.
- Learn each other’s “language.” A combined 87% of surveyed CIOs say their CFO counterpart should be more technology savvy to improve communication with them (it’s an astonishing 97% in Israel).
- Don’t be afraid to seek guidance from your colleague, especially regarding complex issues like security and emerging technologies.
At times, it may indeed seem like the CFO and CIO are speaking different languages, one focused on financial results and the other on functional and security challenges. However, a strong, collaborative CFO/CIO partnership can help them better understand each other’s goals and concerns and ultimately prove profitable for the organization overall.
