CEOs and CFOs Pull Rank On CIOs In IT Purchasing Decisions
July 18, 2011 Dan Burger
Here’s a report that should be read by those who want the Power Systems IBM i platform to be marketed more effectively. It’s all about delivering the message to where the decisions are being made, which–according to the analysts at Gartner–is increasingly found at the desk of the top financial executive rather than the top IT executive.
Gartner surveyed two financial organizations, which certainly skews the results, but even with slightly tarnished revelations the results are noteworthy and perhaps cause for concern because it comes down to who’s driving the IT bus. The contingent with the financial credentials say they are increasingly making decisions on whether specific IT projects get green-lighted or pulled over to the side of the road.
I know what you’re thinking: Those damn bean counters. What do they know about IT?
What they told Gartner they know about IT is that they don’t trust it to provide clear benefits to the business side.
Whose fault is that?
Sure, those glorified bookkeepers find business benefits in some pretty sketchy neighborhoods. But it’s up to IT to explain to them in simple language the IBM i facts of life and the lessons of return on investment and total cost of ownership. If you are at a loss on how to connect IT and business objectives and strategy, call Trevor Perry. He’s pretty good at explaining how this is done. (And, by the way, Perry will be speaking on this topic at the NorthEastern Systems Technology User Group meeting on July 28 in Fairfield, New Jersey.)
“There is a message in the study that IT needs to get much closer to business,” Gartner analyst John Van Decker told Computerworld magazine. “If they (CIOs) don’t do that I think what you are going to see is more of the control being taken away.”
Van Decker was speaking to that magazine because Gartner had just teamed up with the Financial Executives Research Foundation (FERF) and the Financial Executives International (FEI) to do a survey of who controls the purse strings and makes the decisions about IT projects. According to that survey, CIOs (on average) have only authorized 5 percent of IT investments, while CFOs do it 26 percent of the time. (The three organizations conducted a survey of 344 organizations between October 2010 and January 2011 of varying sizes, and you will have to judge for yourself if you think this is a representative sample or if it even applies to OS/400 and i shops.) Of those who responded to the survey, 42 percent said that the IT organization reported directly to the CFO, while 33 percent said IT reported to the CEO. Perhaps more ominously, only 30 percent of the bean counters that the three organizations talked to said that IT “fulfills its mission.”
“This high level of reporting to the CFO, as well as their influence in technology investments, demonstrates the need for companies to ensure that their CFO is educated on technology, and underscores just how critical it is that the CIO and CFO have a common understanding on how to leverage enterprise technology,” Van Decker said in a statement accompanying the figures. “IT organizations must understand the CFO’s views of technology investment decisions and must work toward developing a relationship with the CFO that resembles a business partnership.”
The message to the IBM i supporters is “get out of your comfort zone” and explain what the system and staff capabilities are to the executive managers whether they have the word “chief” in front of their titles or not.
For more on the Gartner survey on CFO influence, check out this link.