Emilie Ditton IT Decision Making: The Role of the CFO

Research Manager

IDC

Big questions for CFOs

What is the time

horizon of these

IT investments,

and have they

been factored

fully into financial

plans?

Is our

technology

strategy

delivering the

full potential of

our

performance?

What is the role of

technology in driving

cost to income ratios

and revenue growth?

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Why are we talking about CFOs?

The changing face of IT decisions

Agenda

The conflict: cost efficiency &

growth

• CFOs are a major stakeholder to IT

• Reporting lines

• The business case

• Voice of IT on the board

• CIO and CFO roles are changing

Why are we talking about CFOs?

57% of ICT decisions will involve a line of business

executive

CMO CTO

CFO

CIO

Line of

business

IT decisions: No longer owned by IT

Delivering full potential of technology

Cloud

Mobility

Smart phones and tablets

Vast explosion of data

Connected devices Analytics and Big Data

The changing role of the CFO

CFO

Financial planning

Financial reporting

Economic strategy & forecasting

Treasury duties

Traditional role New CFO role

• Wider ownership of strategic

business decisions

• Strategic leadership role

• Support growth, not just cost

efficiency

• Increasing level of influence

over technology decisions

CFO View of IT

If your organisation cuts overall expenses, which areas do you

expect will see the largest percentage budget decrease?

• Raises alarm bells

• The opportunity exists

for CIOs to take a lead

role in demonstrating how

IT can be instrumental in

delivery of business

strategy and performance

IDC ANZ CXO Survey, May 2013, n=704

CFO: Focus of IT

What do you expect to be the biggest

focus of your IT department?

Do you view IT as a

competitive differentiator?

IDC ANZ CXO Survey, May 2013, n=704

This is the opportunity for

CIOs to demonstrate the

value of the IT.

CFO: Delivering Cost Efficiencies

IDC ANZ CXO Survey, May 2013, n=704

To reduce expenses, which of the following IT

initiatives do you feel would have the biggest

impact?

• Cloud front and

centre for CFOs

• Transformational

and tactical cost

savings are targets

of CFOs

• Real cost

efficiencies require

business process

redesign – doing

things in a better,

quicker, more

productive way.

But, expectations are positive…

What is your outlook for business prospects?

IDC ANZ CXO Survey, May 2013, n=704

And, CXOs are concerned about growth….

What are your top business concerns in 2014?

IDC ANZ CXO Survey, May 2013, n=704

3 of the top 5 concerns

relate to revenue growth

1. New customers

2. New market expansion

3. Keeping customers

• Finding new customers

the 1st or 2nd business

concern across all

industries

• Escalating costs: Health

• Retaining talent: Gov’t

• Profit margins: Banking/

Retail /Transport

Growth: CFOs looking to connectivity, cloud

and Big Data How would you deliver growth through technology?

• Technologies that

deliver growth are

on the radar

• The opportunity

exists for CFOs and

CIOs to collaborate

to build the growth

story.

• Challenges in ROI

IDC ANZ CXO Survey, May 2013, n=704

Integrating IT with business planning

Opportunity exists to drive the understanding of how IT can

really deliver competitive differentiation.

• CFOs are a key stakeholder

• IT should be used not only to deliver cost efficiencies...

• But also, revenue growth/customer engagement/delight

the customer

• Engagement and education are critical

• CIOs must work to ensure their CFO understands the impact of

technology on the business case for growth

Conclusions 1. CIOs must engage with the CFOs to build the case for IT to

support growth

2. CFOs roles are extending to integrate more fully with

business decision making – CIOs must leverage this and join

the ride.

3. The imperative rests on the CIO to educate and inform their

CFOs through the business case of the role that IT plays in

supporting growth

4. This is about driving relevancy of CIOs and delivering value.

Thank you

IDC Australia

L20, 8 Napier Street

North Sydney, NSW

Australia 2060

Emilie Ditton

Research Manager

www.idc.com.au

Follow me on Twitter

@editton

Summary

Driving the case for IT as a competitive differentiator

The CFO is a dominant stakeholder for engaging IT with business

strategy

1. By virtue of ownership of the business case

2. 30% or more of CIOs report to CFOs

3. CFOs are very often the voice of IT on board

CFOs : View IT through prism of cost efficiency and productivity

• CIOs & CFOs must build the story for IT to support growth

• CIOs must inform, engage and educate their CFOs

Which of the following activities will your

organisation likely be undertaking in the next 12

months?

IDC ANZ CXO Survey, May 2013, n=704

• Operational cost

management related

activities biggest

focus.

• Many short-term

tactical activities rate

highly.

CFO: Operational cost focus