CFO: Do You Know If Your Technology Is A Liability Or Asset?
The CIO is now being seen more as the right hand to the CEO. But does that mean everything the CIO contends for is worth the investment?
Technology turns over every 2-3 years. How do you know if the current technology in place is a liability on your business or an asset, leveraging exactly what you need?
It’s difficult to know the answer in the changing landscape of digital transformation and the roles of C-Suite Executives. The CIO is now being seen more as the right hand to the CEO. But does that mean everything the CIO contends for is worth the investment?
As the CIO role develops, their priorities are shifting. Whereas saving costs was the number 1 priority in 2013 to 71% of CIO respondents (hear the applause of the CFO in the background), now only 55% of respondents place cost as high priority. Also in decline is the CIO priority of increasing operational efficiency and delivering stable IT performance. Instead, improving business processes, developing products and enhancing customer experience is gaining higher priority, and those have new technologies and costs associated with them.
Whereas the CIO was an operator and technologist, they now focus more on being strategist and catalyst, aligning business with IT strategies and promoting innovation.
What is a CFO to do?
Technology becomes a liability when the following is true:
1. When you are trying to keep up rather than step up.
The fourth most common two-word term in recent earnings calls is machine-learning. It’s such an assumed part of our future that companies are beginning to jump into technology that has no use cases verification. AI requires significant customization (and therefore, costs) before it provides value. Technology exists to help companies step up to what they must accomplish. Just trying to keep up is a recipe for wasted expense and hidden costs difficult to calculate. Not only is time money, timing is money.
2. When you are playing it safe rather than keeping it real.
Technology turnover requires divesting one’s self of prior beliefs, of keeping an open mind and refusing to be bound to few solutions.
One-half of all strategic initiatives fail when strategy and delivery are disconnected. Out of date and obsolete technology is a significant liability when it blocks the business driver.
Will your essential business outcome be able to be carried by your current technology?
3. When you are serving technology rather than technology serving you.
Anytime you are structuring procedures and processes around the technology available to you, or anytime you are just trying to get the same output for less cost, you are serving technology. If your training costs and hidden costs are being invested in current technology that lags behind your need, you are serving technology. Anytime you are covering for less than best customer experience, you are serving technology (Customers don’t care if you are operating off of a legacy system or modern system. They do care about the ease of their experience).
But when technology is serving you, then technology is an asset:
- If it improves business processes
- If it delivers stable IT performance
- If it increases operational efficiency
- If it saves money
- If it develops new products and services that are revenue generators
- And most of all, if it enhances the customer experience
In the end, as CFO you need to concern yourself with one question: Will the technology we have deliver the business outcomes we established?