The CFO oversees IT to ensure that IT’s mission, priorities, and plans are linked to company strategy. The CFO ensures that IT is executing against the plan, that the company is leveraging IT for efficiency and innovation, and that IT’s benefits drive to the bottom line. For all CFOs, a key objective is to leverage IT to automate and rationalize financial processes.
Where applicable, the CFO can lean heavily on the CIO for IT decision making. In these companies, the communication between the CFO and CIO is paramount to any IT initiative’s success.
Not all CFOs will have oversight of IT initiatives. In any case, the CFO will have some responsibility for investing in and managing finance technologies. Every finance department should have a pulse on leading technologies in their industry with a timeline to implement, scale, and automate where possible. The CFO and the rest of the C-suite should be present in discussions surrounding IT spend.
Finance needs to understand where financial systems improvements are on the company’s technology agenda with an ROI for significant projects. This includes ensuring that modifications will fit with existing infrastructure and maintain cost-effectiveness. Along with any major systems implementation, adequate training should be provided to key users of the relevant business processes.
CFOs Who Oversee IT
Oversight of Technology Strategy
All business strategy will likely involve technology at some level. In organizations where the CFO retains responsibility for IT oversight, the CFO will need to determine the leadership level required to manage technology strategy. Typically this will be either a director-level individual or CIO. Oversight of IT includes ensuring a defined and documented strategic technology plan, outlining the role, purpose, and vision for IT. The lead strategist should be well-informed on current technology improvement opportunities. The CFO will need to:
- Determine the level of leadership required for IT: whether CIO or Director
- Continually evaluate the potential effectiveness of more automation
- Ensure there is a consistent methodology for considering the IT aspects of business strategy and for including capital and operational IT costs in business initiative budgets
- Ensure that infrastructure is cost-effective, flexible, scalable and will lead to reduced future per-user computing costs
- Oversee implementation of a technology governance process with executive and stakeholder membership and buy-in
Oversight of Technology Execution
In executing IT strategy, every major project should include a finance team member to contribute at every step of the process. Finance may play a more predominant role in specific projects, such as implementing bots as part of an RPA strategy. Finance needs to:
- Ensure that capital and operational budgets for technology are in place along with exception reporting to executive leadership
- Ensure that CapEx and maintenance budgets reflect all-in costs
- Ensure that IT performance metrics are aligned with the technology strategy
- Ensure that IT internal controls and audit processes are defined and working properly
- Ensure that security and disaster recovery plans and procedures are complete and are thoroughly tested