CFOs are increasing their influence over IT as IT costs and spending continue to rise, according to Rimini Street.
These are from findings of a Censuswide survey conducted March 12-April 2, 2024, which covered 2,937 CFOs and CIOs from global industries including manufacturing, retail, telecom and utilities, financial services and energy.
Budgetary considerations and demand for results require CIOs to deliver strong ROI from selected technology investments. CIOs that work in close partnership with their CFO counterpart can help drive profitable results for the business by prioritizing projects that support the company’s financial and growth goals.
Results show that the CFO and CIO partnership continues to strengthen as 86% among them say their relationship has strengthened.
CFOs are taking a more prominent role in the decision-making of IT investments. The data shows 72% of CFO survey respondents say they take the lead in setting technology budget levels, and nearly 41% of CIO respondents state that their CFO counterparts make the underlying technology decisions.
The deepening collaboration and shared accountability between the two groups can lead to greater profitability for the business, with 49% of CFO respondents sharing that they believe the positive CFO/CIO relationship was the reason for improved business outcomes.
“Working closely with the CFO in strategic alignment and in the early stages of planning helps technology teams make smart decisions that are in line with both the corporate vision and budgetary goals for the business,” said Rimini Street CIO, Gertrude Van Horn.
Also, CIOs are tackling rising IT costs with investments in emerging tech (44%) and by outsourcing application support (36%).
CIOs are investing heavily in AI to address rising IT costs. A combined 87% of CIOs agree that historical data is the secret sauce to maximising the value of their AI projects for ERP, but 94% state that their data needs substantial or moderate clean-up in order to succeed with AI.
Another area of budgetary focus for CIOs is to improve cost predictability. By outsourcing IT services, which can help solve for the loss of IT talent and staff, CIOs reported the benefits include support of application customisations (33%), broader service and support solutions (33%), better quality of service and support (32%) and faster resolutions (30%). And 26% say they were able to lower costs.
Further, not all technology initiatives are delivering value for the business. ERP upgrades or migrations (23%) delivered the least amount of value for CFOs.
While security (28%), emerging technologies such as AI, business intelligence and data analytics (27%), and customer-facing SaaS technologies (27%) rounded out the top three spots for technology investments considered highest in value for the business, ERP upgrades or migrations failed to show the same level of enthusiasm from the CFOs surveyed.
Only 20% of surveyed CFOs state that they are happy with the results of their technology investments. They often experience a negative impact, such as increased ongoing costs, limited future flexibility, or business disruption.
Because of this, CIOs must consider both the short and long-term impact of their technology strategy.
