In today’s business world, a company’s success will be determined by the company’s CXOs ‘ relationship quotient, with the company’s primary focus on the synergy they will bring into the day-to-day operations. The CFO and the CIO of an organization are two people who will play a major role in this journey; the importance of their relationship will grow as the company embarks on the journey to digitalization.
With technology playing a greater role in creating competitive business advantage, even CFOs will need support from their IT counterpart in order to operate effectively on a daily basis. Similarly, the CIOs should bring major technological changes to the enterprises in line with the corporate strategy for which on the investment front they will need CFO support. It is therefore imperative that CFOs and CIOs work closely together to build a successful future digital enterprise.
Bring forth the scenario of interdependence:In terms of technology, new business models or new cost models, the CFO brings breakthrough ideas to the table. None of these can be done alone, the CFO must recognize. He needs the IT partnership to make it quick, efficient and comprehensive. That recognition of incompleteness should force the partnership to be on an equal footing without the IT piece in place. On the other hand, the CIO must acknowledge serving two masters–the CFO and the CEO. While one is the head of finance, the other is the head of the business as a whole. CFOs are often one of the CIO’s biggest customers— customers who are often bosses as well.
Take joint responsibility for the future:The CIOs alone should not be responsible for delivering technology results. The CFOs can also make a significant contribution to the development of the strategy based on their understanding of the business needs. As a result, IT must be treated as an innovation driver for the organization.
Blunt the threat of disruption by embracing digital: The question of “why” is no longer valid in the age of digital disruption. Everyone knows why digital-savvy is needed. The focus is instead on “what” and “how” – what needs to be done to maintain competitive advantage and how quickly it can be achieved.
IT as an expense versus IT as an investment:Whether we treat IT as a cost center or as an investment center is always the discussion? If we invest too much, the profitability of the year will be throttled. It will throttle the future if we invest too little. The CIO and the CFO should, therefore, come to an understanding of what the optimum investment should be and how to get profit from it. Therefore, we need to invest by focusing on the future, not immediate, returns.
Keep watching this space for more.