It’s no secret that when economic times are tough, IT budgets are tightened and spending is under much more scrutiny. CFO’s are looking to their IT departments to see what spending is necessary, and what needs cutting back. With this in mind, ComputerWorld asked several CFOs what they would like their IT departments to know in terms of spending.
Their answers were just about what you’d expect – but we’ll break it down for their and our benefit.
First, don’t expect the “bells and whistles.” Extra functionality and options may be nice, but if it doesn’t make a big impact on what can be done with the equipment or software it may not be the right time for it. Getting more with less is the name of the game here.
Next, use what you’ve already got. With technology progressing as fast as it does, it’s easy to get caught up with wanting the very latest and best. Progress is so fast that sometimes we don’t even even have the chance to explore the full functionality of what we’ve got before the next iteration of it is released. Sometimes, this means doing a little in-house development instead of making a full upgrade, but the bottom line will often be the better for it.
CFO’s also want the IT departments to know where things stand in terms of business strategy and goals. While many companies are doing much more integration between IT and the financial side, there is still often a clear division – and that can result in a disconnect in knowing what the company needs. If IT knows how the business strategy is going, and the financial side knows how IT is impacting the business, good decisions for both are much easier to find.
Part of that means better estimation of ROI by the IT side. CFO’s have a much easier time making decisions on spending and investment if they have detailed estimates to go on from the IT department. This means evaluating both short-term and long-term ROI, along with potential risk and potential gain. These days, short-term ROI in particular is being emphasized – but not at the expense of long-term ROI.
Jim Morrison of Teknor Apex sums it up by saying, “We look at IT as an enabler of a lean company. I don’t think there’s a function that doesn’t feel that the IT systems are absolutely essential to their performance. So we give them what’s needed. They just have to show there’s a good return.”