As if you didn’t already know, your buddy with the middle initial F is back. And I do mean buddy. A memo out this morning from consultancy Gartner Inc. reminds that in economic crises, CIOs need to “build a powerful alliance” with their CFOs to improve business value.
That would seem to be a wise step in light of the dark news today that stocks plunged more than 600 points, and that according to the latest Wall Street Journal (WSJ) survey, a majority of economists believe gross domestic product (GDP — the total value of goods and services produced) will shrink in the third and fourth quarters, as well as the first quarter 2009. If true, the WSJ piece says this would mark the first time U.S. GDP has shrunk for three consecutive quarters in more than 50 years.
Ugh. Back to you and the Gartner memo.
It seems that despite years of being told you need to “demonstrate the business value of IT,” doing so has proved a Sisyphean labor for CIOs “because of misaligned mind-sets between the CIO and CFO,” writes Dave Aron, a Gartner VP and research director. The path to reconciliation?
“The CIO and CFO have to devote time to aligning the economic architecture and the enterprise architecture of the business. In order for CFOs and CIOs to ally closely, they must come to a shared view of value. The most powerful tools for achieving this alignment are portfolio management and enterprise architecture.”
In 2008, 23% of CIOs report to the CFO, while 38% report to the CEO, but the trend is listing toward CIO to CFO.
Ugh again. CIOs with their IT shops in order and looking to have a bigger impact on business value have a harder time busting loose when they report to the CFO, Aron said.
“There are two clear pieces of evidence for this. First, only 45 percent of CFO-reporting CIOs have leadership roles outside of IT, compared with 63 percent of CEO-reporting CIOs. Second, CFO-reporting CIOs spend one day less per month with the board and senior executives than do CEO-reporting CIOs.”
Not to despair.
“The message here is not that CFO-reporting CIOs are doomed to failure,” Aron said. “Rather, it is that these CIOs need a focused plan to break out of the box, which should include influencing the CFO to be more IT-savvy and to understand the CIO’s full capabilities as a contributor.”