CIOs, take your CFO to dinner and pay for it
I’ll leave the wine-pairing to the sommelier, but here’s a menu of topics for conversation that can fruitfully accompany each course.
Coffee is inexpensive, drinks are the norm, and lunch is predictable. But dinner, on the other hand, means business. If you’re a CIO, it’s time to pick up the phone and invite your CFO to dinner. You have plenty to talk about.
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I recently had the opportunity to attend a CFO conference (as a token technology speaker), and I came back energized and enthused. The agenda included myriad topics that could easily be on a CIO conference agenda: innovation, disruption, cybersecurity, and technology-enabled business transformation, for example. CFOs in my session engaged me on topics ranging from assessing IT talent to developing an agile architecture. But once the convention ended, it was the comments from CFOs who don’t understand their company’s technology-investment strategies or trust their CIOs that lingered with me. I mean it, my fellow CIOs. Call your favorite restaurant and reserve a table for two.
I’ll leave the wine-pairing to the sommelier, but here’s a menu of topics that can fruitfully accompany each course.
Mutual funds and portfolio risk over cocktails: If you are a savvy CIO, you have created your technology portfolio like a mutual fund—where you are balancing risks across various technology investments. Often, business and functional leaders miss the risk part, partly because we have done a poor job of communicating it to them. More than anybody else in an organization, they understand the risk-reward equation. You have to discipline yourself to highlight and track the risks and benefits. A CIO of a large high-tech company who does this really well had the following advice for CIOs: “We (CIOs) are in the predictions business. If we aren’t making big bets around our future business needs, we are holding back our organizations and setting ourselves up for failure.” Naturally, some bets pay off big while others don’t, but most importantly, this approach will enable you to be a proactive business partner—rather than a reactive one.
Stocks and valuations with the salads: Every stock broker has a valuation methodology that they use to figure out if a stock is worth investing in. All too often, CFOs feel ill-equipped to evaluate technology investments. CFOs frequently ask me, “How do I know if I am overinvesting or underinvesting in IT?” It doesn’t matter what methodology you come up with, but make sure your CFO and business leaders understand how to evaluate technology investments. It is fascinating to see how much time organizations spend building business cases without going back to evaluate actual benefits. Contemplating investments is a significant undertaking, but tracking their actual performance is even more important. And CFOs can become your best friends simply based on their ability to hold business leaders accountable.
Venture funding and entrees: Two elements of venture funds are important for CIOs to understand and apply: stage-gate investing and strong governance and accountability. Both are usually missing from strategic technology investments. Involving a non-technologist (CFO) in technology governance can add perspective and discipline that helps you to think like a venture investor. Ask your CFO to lead your technology governance. It will almost certainly lend more transparency and credibility to your undertakings. But much more importantly, you now have a joint owner for technology governance. One CIO/CFO duo uses the shark tank model for funding and on-going investment decisions around their technology innovation initiatives.
Forecasts and projections for dessert: Market analysts know that historical data is an input, but it can’t predict a stock’s future success. Analysts are always on the lookout for the disruptors that will influence a stock price. Technology platforms such as cloud, mobile, and analytics could all be disruptors within a given context, but the disruptors could also be the legacy and mainframe environments that are holding you back from making your technology environment agile. The disruptors could also be scientific breakthroughs (3D printing) or regulatory changes (healthcare in the United States). As a CIO you need to identify those disruptors. Your CFO can help you understand and articulate the impact of these potential disruptors on your business.
One last word of advice: Give your credit card to your server ahead of time. This will remove the awkward arrival of the bill, and it will symbolically demonstrate that you are committed and willing to proactively invest in this relationship.