Ten IT Talking Points Your CFO Will Love
Do you know how to talk to your CFO in terms that he or she understands? Here are ten talking points for the year ahead.
Wed, December 16, 2009
CIO —
I have nothing against CFOs. It's a tough position with a lot of pressures that can easily be misunderstood. That being said, it is the money people who generally stand in the way of engineers and technologists and the spending required to accomplish great things with IT.
It is a common problem we all have—dealing with accounting, the CFO or other non-IT management. Of course, our running joke is the CFO thinks of technology as a $499 PC they can pick up at Staples or OfficeMax. They don't understand why $29 billion is collectively used to power and cool IT infrastructure; 50-cents for every dollar spent on servers. They do understand the "space crunch" that IT manifests at $2,400 a server and $40,000 a rack at $1,000 a square foot. They see the money going out the door. Then they read about "server sprawl" and the $140 billion in excess server capacity available in the U.S. — a three year supply. No wonder they get so upset: "You're spending how much? On what?"
So we walk away with the feeling they simply don't get IT. But some of the problem belongs with us — we don't communicate in the language of the CFO. And because we don't, we shouldn't act surprised when we get pushback on spending requests. This needs to change. Here are ten areas where we, as the promoters of IT, can begin to communicate better with the CFO:
1. Think TCO, not ROI
Traditional ROI thinking won't work anymore for us. To the CFO, return on investment is how much money you're going to give back to the company. Let's face it. Most IT projects—no matter how compelling—don't bring "return" to the organization like an additional sales person, a new marketing campaign, or a new product launch. Discuss projects with CFOs in terms of Total Cost of Ownership (TCO). Repeat it until you are blue in the face—IT projects are overhead. You get over this by demonstrating fiscal stewardship by showing that you are providing the lowest cost. To do that you must provide options, comparisons, case studies, and examples.
2. Clouds
CFOs like what they hear about cloud computing as a cost saver. Don't fight them on it. You can leverage what they are hearing in order to steer cloud spending on the right IT projects. All CFOs understand that you don't want private customer records or sensitive financial data "in the cloud," for example. Incorporate cloud or managed services for tactical, not strategic, applications.
