CIOs should strive to forge good relationships with their companies' CFOs. Three CIOs who have had some success in that endeavor say IT leaders should aim to be collaborative and meet regularly with the CFO. But financial executives are among the busiest people in any organization, so it's important to learn something about what they do and keep conversations at a high level.
Understand the language and the role
I know the CFO is one of the busier people in the company, so during our weekly one-to-one meeting, I try to focus the discussion on a punch list of the 10 things that are critically important to move the business forward. We also communicate frequently via text--usually on specific issues and project updates. I don't bother him with decisions about projects that cost $5,000 to $10,000, but I do consult with him on initiatives requiring investments of more than $100,000.
Be sure to find out what the CFO does. Signing off on Sarbanes-Oxley compliance, overseeing all the financial functions and managing finance personnel are typical responsibilities, but CFOs wear a number of hats. Given the global nature of our business, our CFO has his finger on the pulse of everything--including new client pitches, the quarterly forecast and developments at the parent organization.
Having a baseline understanding of what the CFO does helps me when we discuss particular situations in which I need resources. For example, I'm familiar with the quarterly reforecasting process that he manages, and I understand how he might take the forecast into account if I present him with a request for a resource or capital--a bigger piece of hardware, for example. If it isn't a smart time to spend money, the CFO lets me know.
Keep it high-level but be prepared to drill down
To build a great relationship with the CFO, it's critical to speak his language by understanding the financials and using relevant terms like capital expenses, accruals, depreciation, G&A [general and administrative expenses] and so on. I also understand how what I'm doing contributes to the company. When I go to the CFO with a budget request, I only present initiatives in terms that make sense to him. If the project doesn't generate revenue, save money or protect the firm in terms of reducing risk, I don't present the story.
While I aim to keep conversations with the CFO at a high level, I am always insanely well prepared with details he might ask about. I never want to be in the position of saying I have to get back to him with information. When proposing a project for a specific business, I also make sure I've already gotten executive buy-in, so I can refer the CFO directly to the business leader if he asks.
It's also critically important to build a relationship between the CFO's entire team and my own. Establishing deep bonds between the teams--with the controllers, the tax group, the accounts receivable department and others--builds confidence.
Thrifty White Drug Stores:
Meet often; be collaborative
I had the option of reporting to the CEO or the CFO. I chose the CFO, who is more tech-savvy; it was a better fit for the organization.
An open line of communication is critical. We have a weekly standing meeting so I can keep him informed about various IT projects, new opportunities that have popped up from different lines of the business and so forth. These discussions build trust and understanding for the different things we're doing in our department.
I've also learned to be flexible. Every company goes through a budgeting process to determine expenses for the year, but new needs may arise. You need to be able to go back and give the CFO accurate timelines and costs for projects to address those new opportunities. This is where transparency helps.
Lastly, be sure you understand the business objectives and can clearly explain where IT needs to spend the money to achieve them. There are often many ways to solve a problem, so I present multiple solutions if possible. I provide options--including the costs and associated risks. We examine the options together to make the best collective decision for my department and the company.