by CIO Staff

Should the CFO be in charge of IT?

Feb 29, 20125 mins
IT Leadership

Following a blog on CIO UK about whether the role of the CIO is being absorbed by the CFO, a number of readers have responded with their own views on this trend.

With such an incendiary issue as this, many did not want to be named, even though they felt strongly enough to respond to a call for comment. However the responses come from IT leaders in a range of industries, including biotech, education, pharma, transportation and retail.

One IT boss who was happy to be cited was Robert Teagle, EMEA IT Director, Starbucks Coffee EMEA B.V, who said:

“The comments from your CFO participants may show a disconnection between IT and Business Strategy, but this is normally due to (a) IT not having the right level of engagement within the business; (b) Ineffective CIO; or (c) Lack of IT sponsorship within the business. The key is to elevate IT, ensure your IT leader is as much as business leader as a technology leader and ensure the enterprise understands the value technology can bring to the organization. In many organizations, CIOs spend much more time with the CEO, CMO or COO than the CFO – due to the importance of technology.”

Typically, as organisations grow from SMB to an enterprise the IT function will naturally fall within the remit of the CFO, but as technology reaches the levels of investment where deployments can create game-changing business opportunities rather than just glue that keeps the company together, the need for a CIO becomes more apparent. Former Centro director Denise Plumpton noted the CFO/CIO debate was not a new one but that the opportunity for IT to be a transformational force put a new edge on the argument.

She said: “Consider the CIOs who are regarded as being most successful and you’ll find they are the ones who can demonstrate that they play a key role in determining business strategy. To subsume the role of CIO into Finance, places IT as little more than infrastructure and commodity with a focus on cost reduction coupled with a purely reactive approach to new system and technology developments. I firmly believe that it’s also the responsibility of the CIO to lead on identifying innovative opportunities for businesses to grow and prosper and to contribute actively in defining strategy. The challenge for the CIO is to demonstrate worth to the business, initially by making sure there’s a knowledgeable IT voice at the top table and then by delivering solutions, measuring their benefits and shouting about it.”

Graham Francis, director of IT services at Havering Sixth Form College pointed out that the imperative to lead the way in a technologically-based process might be the last thing on a finance leader’s mind, especially if it conflicts with fiscal discipline.

He said: “I think there is also a danger that the justification for a project can be lost when it is being headed by a non-I.T. specialist who considers the project more financial position rather than from an operational one. In the case of my own college, the completion of an infrastructure refresh which involved upgrading the cabling has been delayed for a year so that another refurbishment project could take place, despite my complaint that we would have some classrooms having connectivity issues as part of the room has not been refreshed whilst the other side has as part of the refurbishment.”

One anonymous IT leader from the corporate world confirmed this sentiment is just as strong in the private sector. There is a general acknowledgement that the senior management dynamic in all organisations is undergoing change, but that technology needs a separate voice from finance.

They said: “What I am seeing now is a bringing together of all core services within large organisations (HR, Finance, Procurement, Facilities and IT) and these are reporting through to one board member. The reason for this is not to better represent the business but to make savings in organisations where this is not its key business. The next obvious step is to outsource these to companies who provide this as a core capability. However to be in the forefront of technology and ensuring that the organisation can be innovative and leading edge you do have to spend money. This would be a real tension for a CFO and so having a separate individual in a CIO role ensures that the right discussions take place.”

Just as in the round table that sparked this debate, the final word was that the roles and responsibilities weren’t as important as the collaboration between executives with a complement of business skills and perspectives, this anonymous respondent said:

“The key factor here is that the ultimate lead on technology strategy must be one person that understands both IT and the wider business; whether CFO or CIO is doesn’t matter which – however I wouldn’t want to be CIO in a business where I was not the ultimate lead.”

Do you think the CFO is the appropriate head of the IT department, or does it need its own representative at the top table?

Pic: qnrcc2.0

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