One of the compelling developments in the transition from a COVID basis to protection against turbulent economic times has been the evolving role of CIOs, particularly in relation to leadership in business transformation. As a long-time student of such technology-driven changes, I was fascinated by how CIOs can work with CFOs as key change agents. Businesses are finding a new normal as pandemic disruptions give way to a constraining economy, and nascent alliances between these two C-suite members are serving as leverage points to accelerate change.
The budgeting and planning process has become a key arena for this revolution – all the more so given the specter of a looming recession. CIOs are working with CFOs to fundamentally change the culture of their organizations, rebooting the way we work in this new hybrid world to make it more inclusive, collaborative, agile and bottom-up – and often improve the customer experience with new products and simplified shopping experiences. And the specter of an economic downturn only makes these relationships more powerful.
CIOs work with CFOs to transform and reboot the culture of their organizations … [+]
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Importantly, there are lessons to be learned from their experiences – a roadmap for CIOs who have yet to forge alliances with their CFOs.
CIOs often command the largest C-suite budgets, constantly navigate dependencies between other departments and functions, and are the architects and sherpas of digital transformation, providing them with critical experiences applicable across the enterprise. “The CIO’s position as the hub that brings the entire business to life positions them well for transformation,” noted Yvette Smith, CIO at F5. Furthermore, the unprecedented pace of digitization during the pandemic has only underscored how effectively technology can transform businesses.
For example, we’ve learned that we can move beyond 20th-century notions of collaboration—that we don’t have to be physically in the same place all the time to brainstorm, plan, or execute. Our research institute GoForwardToWork.com has captured many of these lessons since the onset of the pandemic, including the fact that we have only just begun to realize the potential of this transformation. Too often we have transferred personal routines to the virtual world instead of embracing the new ways of working. For example, starting collaboration asynchronously is not only more efficient, but also allows a wider range of voices to be heard.
Adopting this new way of working is critical to the planning and budgeting process, as leaders can dig deeper and leverage those closer to the front lines to determine which initiatives are yielding maximum return. For this reason, CFOs are natural partners in this process: they have an interest in reshaping business planning to gain better visibility into where and when key decisions are being made, and to have greater agility in terms of connection and to facilitate these decisions. By leveraging these technologies, CIOs and CFOs can develop a more agile planning process that resembles an ongoing, organic conversation rather than the traditional static top-down model. The ability to plan, analyze and act in real-time is a critical factor in these unprecedented times.
For example, American Airlines’ CIO and CFO recently worked together to map a new financing model and product structure, and to introduce a planning architecture for goals and key outcomes. In 2020, Unilever redesigned its planning process to gather ideas from senior managers below the executive team and allow them to bring the top 300 leaders into the planning process, giving them a better ability to identify growth opportunities, leading to a half-dozen strategic priorities as well resulted in better mission alignment across the organization.
But what if you’re a CIO who hasn’t yet figured out how to work with your CFO to drive transformation? We convened a CIO Roundtable to discuss these burgeoning partnerships and how to foster them. Three key lessons have emerged:
Raise
“Reaching that next level of relationship with the CFO is not just about understanding their initiatives and priorities, but also understanding – and helping them understand – how technology investments have a broader impact and impact on ours bottom line,” said Greg Moore , CIO of KB Home. When that meant explaining to his CFO the four-year transition from on-premises data centers to a cloud-based system, Moore took a pedagogical approach, demonstrating “the distinct values we could bring to the business by transforming it and moving to cloud.” infrastructure.”
As Angela Yochem, Chief Transformation and Digital Officer at Novant Health put it, “We need to encourage our CFOs to dig deep into the technology inventory that drives their businesses.”
And crucially, in our work with teams from the C-suite onwards, we’ve found that education leads to empathy – which leads to getting things done.
build relationships
Too often, CIO-CFO relationships are purely transactional – you need something, so ask for it and possibly strike a deal to get it. But true partnerships require a deeper connection. “It always starts with empathizing and understanding the friction with those people and working with them to build that strong relationship,” said Joseph Cevetello, CIO of Santa Monica, California.
Speak the language of the CFO: Emphasize your educational efforts, for example, in terms of value to the company. By focusing on that and not the cost, you can invite the CFO to help create a methodology to identify and quantify that value creation in the business plan.
Building such a relationship requires intentionality. “Conversations lead to opportunity, opportunity leads to impact,” Yochem observed. However, you shouldn’t just rely on random water cooler controlled connections. “You have to take your time,” said Helen Norris, CIO at Chapman University. “It’s the currency.”
driving transformation
The roles of both technology and the CIO have changed dramatically in recent years, a process catalyzed but not triggered by the pandemic. “CIOs are now transformative rather than being responsible for a cost center,” said Girish Naganathan of Technicolor. “They are more strategy enablers than cost controllers.”
Embrace this change and make sure others understand it, especially the CFO. Not everyone has understood this fundamental evolution, so CIOs need to demonstrate it—while acknowledging that it also presents challenges. “Today’s CIOs and CFOs are fundamentally different in terms of their competencies than they were five years ago,” said EY’s Sarah Francis. “In terms of the vulnerability that we’ve seen, addressing it is tremendous.”
It’s an opportunity to both build and educate empathy – and show that CIOs deserve a seat at the planning table and that they are natural partners for CFOs.
Such burgeoning CIO-CFO alliances hold the potential to build the kind of flexible, inclusive, and bottom-up organizational cultures that are critical in the burgeoning world of work. Now, CIOs must adopt these strategies to solidify these partnerships and launch this future.
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