CIO
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For the CIO, chief financial officers have historically been adversaries at worst, obstacles at best. This magazine has done more than a few articles on how to relate to the CFO (see a list of those articles at www.cio.com/printlinks). Although fewer CIOs are reporting to CFOs these days, the moribund economy and the tightening of the expense screws have once more pitted the CFO against the CIO. Again we leap to the rescue with advice on how to work well with CFOs. But this time the wisdom comes not from one side or the other, but from people who have simultaneously occupied both roles and seen the conflicts and solutions through one pair of eyes. David Goltz and Vincent Laino both fill a dual CIO/CFO role at their respective company?Bethesda, Md.-based Destiny Health insurance company (where Goltz was interim CIO through June 2002) and West Chester, Pa.-based environmental consulting service Roy F. Weston. Here they offer CIO readers their unique perspective.
CIO: Where do CIOs and CFOs get disconnected? What are the typical points of disagreement?
Goltz: It’s pretty straightforward. CFOs always look at [a proposal] and say, What’s my return on investment? How can I make this pay for me? CIOs are typically saying, If I spend this much more on technology, I can deliver this wonderful functionality or product or service, though nobody can say, Here’s how much time and money it’s going to save. So to the CFO, it looks like technology for technology’s sake, without any real gain for the company. And the reality is, in some cases it is technology for its own sake. But on the other hand, technology is a fact of business life; you have to have it in order to provide a certain level of service or access to your constituents and customers. Some of it is just overhead you have to have.
What’s the most effective way for the CIO to communicate with the CFO? Particularly when it comes to getting a budget or project approved.
Goltz: The most obvious approach is to say, Look, we need to spend money on this project; this is how it will support our business objectives. Some IT projects have that immediate impact. But the next level of difficulty?and this is where you’re going to have to educate the CFO?is when you have to spend money to stay in stable technology. If you buy a PC today, it’s shipped with Windows XP; it’s not NT anymore. So at some point we’re going to have to move all of our PCs to XP in order to keep a stable platform. The question is, When do you do it? What’s it cost?not just in terms of the cost of the software, but also what we’re spending in terms of support and so on? Then, the best approach is to come into the discussion with your CFO armed with lots of information: If we upgrade now, here’s what it will cost, and here are the savings we’ll have for supporting a single platform instead of multiple versions. But here are the risks: XP is not the most common operating system out there. So you’re presenting it as a business case, even though it’s not always about ROI specifically.
Laino: You must be able to have the conversation around value?not numbers, but value. For example, we worked on a portal project last year, allowing employees to customize our website for their individual use. You have to do a prototype, and sit down with the people in senior functions and say, This is what I think is going to help you
