Posts Tagged ‘IT-Business partnership’


From a distance, one might expect the relationship between CFO and CIO to always be strong.  After all, aren’t there a number of similarities?  Numbers are at the core of both career fields, and both are driven by logic, rules, and standards.  Analysis and problem-solving skills are highly valued, and the quality of results is important.  Coming up through the ranks of Finance and IT typically required significant time spent alone at one’s desk, which may contribute to the attraction of these professions to many tending toward introversion. 

There is no doubt of the importance of the CFO-CIO relationship.  A Deloitte CFO Signals survey states that “45 percent of CFOs surveyed had IT as a direct report, and about 25 percent more as a dotted line report.”  A Gartner study conducted for the Financial Executives Research Foundation found that CFOs have increased their role in technology decision making and that the CIO most often reports to the CFO.

Yet despite the similarities and the importance, there are major issues in the CFO-CIO relationship.  CFOs have long been frustrated by an inability to get a “single version of the truth” from the data in many companies (The Customer-Activated Enterprise).  This frustration is exacerbated with the mandate to accelerate the company’s performance while increasing transparency.  In fact, Deloitte reports that only a little over half the CFOs in one survey felt that they have the information they need to effectively manage the business. Another study by Gartner and Financial Executives International cites that only 25% of CFOs surveyed were confident that their CIO and IT department had “the organizational and technical flexibility to respond to changing business priorities” or are “able to deliver against the enterprise/business unit strategy.”  The study also noted that only 18 % of the CFOs surveyed believe that their “IT service levels meet or exceed business expectations.” In addition, only 1 out of 4 CFOs saw their CIO as a key player in developing and implementing business strategy.

So what actions can the CIO take to improve his relationship with the CFO?  Here are some practical suggestions:

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Perhaps no C-suite relationship today is more broken than the relationship between the CMO and CIO.  In the past, there has been little need to collaborate.  Far too often the CIO functioned as a technologist who was not recognized for having a complete view of the overall business.  He concentrated more on cost cutting and efficiency.  On the other hand, the CMO was about direct mail, magazine advertisements, and television spots.  He was aimed primarily toward branding, lead generation, and communication.cmo-cio-best-friends1  They were almost like two ships passing in the night.  Neither had a tremendous need to interact with the other.  Each was relegated to (or chose to remain in) his own realm.  In some ways, there have been a number of similarities between the two positions.  It was quite normal for neither of them to actually sit on the executive team.  Corporate strategies were often determined without their input.  Just as the CIO struggled to explain the return on infrastructure investments, the CMO had difficulty proving the value of investment in various marketing programs.  It should not be surprising to learn that both the CIO and CMO have struggled in developing relationships with the rest of the C-suite (Outside Looking In:  The CMO Struggles to get in sync with the C-suite and The DNA of the CIO).

But as a result of societal, business, and competitive changes driven primarily by big data, analytics, cloud, social, and mobile technologies, the pressure is on both the CMO and CIO to transform themselves, their departments, and their relationships with other executives in order to ensure the success of their companies.  They need to markedly increase the collaboration between them.  Both need to move from their functional silos into becoming recognized leaders within the broader business context.  This will take a concerted effort – and for the benefit of the company, it needs to be done quickly.

Here are some suggestions for the CIO to improve his relationship with the CMO:

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“What business are you in?”  Ask any IT practitioner this question and you will likely hear something like, “I’m in IT.”

Let’s face it.  Most IT people do not seem to see themselves as bankers, manufacturers, retailers, or distributors.  They see themselves as IT professionals.  After all, couldn’t they easily take their skills to another industry that uses similar technology?lemonade stand

It is true that an IT professional may perhaps be able to switch industries easier than those in some other professions.  But a single-minded focus on technology (rather than on the larger business environment that actually writes the paychecks) prevents your company from truly benefitting from all the talents at their disposal.

In his book Get Out of I.T. While You Can, Craig Schiefelbein proposes an interesting exercise.  Pick out any IT professional in your company.  Now imagine your CEO recruiting that individual on the spur of the moment to show some important potential customers around the company.  You could expect the customers to ask typical questions like:

  • What is your target market for each of your products?
  • Who are the major competitors for each of your products and what are your advantages as compared to your competition?  What are the selling points your competitors use against you?
  • What else differentiates you from your competition?
  • What is your company doing to ensure me that it will still be around in five or ten years?
  • What are you doing to improve the customer experience?

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