CFOs Controlling IT Departments
As information technology needs grow and expand for businesses, so too has the influence that chief financial officers (CFO) have over that the finances appropriated to their IT departments, new research suggests.A survey found that while 26 percent of CFOs have the power to authorize IT investments, while just 5 percent of chief information officers (CIO) do.
The survey also showed that 42 percent of IT organizations report directly to a company's CFO, with that percentage climbing as high as nearly 60 percent for businesses that have revenue of more than $50 million but less than $250 million.
"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," said John Van Decker, research vice president at Gartner, Inc., which conducted the study.
One reason for the expanded role of CFOs could be their current lack of faith in the IT department overall. Only 30 percent of respondents said IT truly fulfills a business mission, meaning the vast majority think otherwise. In addition, only 32 percent of CFOs said they see the CIO as a strategic partner.
When it comes to how CFOs are making IT investments, 72 percent of firms said that they will invest where they see a competitive advantage driven by IT. Sixty-five percent of those surveyed ranked business intelligence — computer-based techniques used in identifying, extracting, and analyzing business data — as the technology most in demand, while 46 percent ranked enterprise business applications such as enterprise resource planning and integrated financial management solutions as investment priorities.
The survey of 344 CFOs and senior financial executives was designed to gather perceptions from financial executives about technology, key trends and planned improvements to operations.