Even before this economic season, some organizations had started to consolidate their senior leadership teams by expanding the role of Chief Financial Officer to include the responsibilities of the Chief Operations or Chief Information Officer. Stericycle and PepsiCo Inc. are some of the most recent companies to make this move.
Why? Merging roles saves on expenses from salaries to office space, but companies may find that this move is much more than a cost saver. A CFO’s experience and insight in the CIO position can transform a company’s ability to maximize technology, streamline complex processes, and make wise financial/technological decisions.
CFO as CIO balances the priorities of both roles
A CFO is responsible for managing spending, cash flow, and financial records; the CIO oversees purchasing, maintaining, and evaluating a company’s technology inventory. When a CFO becomes the CIO, they can balance the priorities of both roles. Instead of two separate people focusing on conflicting goals – for example, the CFO wants the cheaper option while the CIO pushes to invest in the better technology – one CFO-CIO can research the technology options that save the most time and energy long-term and stay within budget. When a department needs new laptops or updated servers, this combination of financial insights and purchasing responsibility can give the company the best value in cost, use, and lasting benefits.
New technologies free up the CFO’s time and energy
More and more, technology is replacing many of the routine, repetitive tasks of accounting, offering more accuracy and freeing up an accounting team’s time to focus on planning and analysis. Technologies that help balance transactions, compare invoices to packing lists, and create budgets and forecasts remove the burden of hours of work from the CFO’s shoulders, leaving them more time for the kind of strategizing and planning that only a human can do. As CIO, the CFO has the freedom and power to find the most efficient and cost-saving technologies and implement them for the accounting department. In the future, technology could change accounting procedures even more drastically – for example, enabling month-end or year-end closings (now, the work of weeks of preparation) at the press of a button.
CFO brings financial/data manipulation mindset to strategy and operations
A CFO also brings strategy, organization, and analysis to maintaining and evaluating the company’s technology inventory. The same mindset trained to ensure that debits equal credits and every invoice is paid can make sure the company is using its technology resources appropriately. For example, if a company’s technology inventory is a closet bursting with laptops, phones, headsets, and cords, some ancient and some useful, the CFO has the organized mindset to arrange a cleanout, evaluation, and better storage system. If every team in the company uses two or more project management software subscriptions, and these subscriptions cost thousands of dollars a year, a CFO-CIO has the power to work with each team to determine if they actually need every subscription and if the company could standardize with one program.
CFO can stream and simplify complex processes
New hires need access cards, computers, phones, headsets, and access to systems including payroll, 401K, and benefits. Departing employees need a way to turn in their equipment and be signed out of the company’s systems. Reorganizations, purchasing, promotions, and various transitions require technological and financial setup for the company to run smoothly and efficiently. A CFO-CIO can streamline and simplify these complex processes with onboarding checklists and a scheduled training process. Just as a CFO needs to keep track of the inflows and outflows of cash and changes in the company’s Balance Sheet, a CFO-CIO can manage and improve the company’s processes to make them easier and more intuitive.
Communication between departments
Both the CFO and CIO need to be involved in every part of the company, helping make decisions on spending, purchasing, and maintenance. As one person, the CFO-CIO has the knowledge and insight to help departments communicate with each other and collaborate. For example, if the company is creating next year’s budget and finds that Marketing is having a user conference in January and the Development team needs new laptops, the CFO-CIO can manage cash flow to pay for the conference and purchase a few laptops per month until the team is fully equipped.
Instead of burdening one person with two significant workloads, merging the CFO and CIO roles can empower companies in the digital age, combining the financial strategy and practical mindset of the CFO with the resources and responsibilities of the CIO. Companies who combine these positions may find that a technology-empowered accounting team, organized technological inventory, and thoughtful purchasing process for technology enable them to make better decisions, maximize their resources, and find new spending flexibility for wise investments and risks.
Centage Corporation’s Planning Maestro is a cloud-native planning & analytics platform that delivers year-round financial intelligence. With Planning Maestro, Centage offers the sophisticated features needed by small and mid-market organizations to integrate budgeting, forecasting, and deep data analysis within one easy-to-use, scalable SaaS solution. For more information on how to modernize your office of finance with intelligent planning, view our product demonstration video, or call 800-366-5111.