So Osborne, the credit union’s controller, and the four CIOs (who oversee core systems, development, E-business, and security) all work closely, to the point where Osborne says that finance and IT are “joined at the hip” regarding business strategy. Osborne describes himself as a voracious reader of anything pertaining to IT management, but also says that “one advantage of being a CFO is that I get to ask dumb questions, and every once in a while, I’ll stumble onto something we hadn’t thought about.”
Osborne also teaches his IT staff about the credit union’s current business climate, from current income to interest rates to priorities for the next 12 months. Vice president of E-business Char Shinn says that’s helpful, in part because “prioritizing IT projects can get to be contentious, so it’s important to have a clear sense of business direction. If your project gets shot down, you know why.”
Nothing about finance-IT cooperation mandates that the CIO report to the CFO, of course. At DTE Energy, both CFO David Meador and CIO Lynne Ellyn report to CEO Anthony Earley, but find themselves working closely together, in large part because of two major projects: Sarbanes-Oxley compliance and the rollout of a new ERP system meant to tie together what growth-by-acquisition hath wrought.
While the ERP system will be phased in over time, it is nonetheless a very large project, representing what Ellyn calls “the creation of a virtual company into which we’ll merge all of our operations over time.” To help it stay on track, the CEO, CFO, and CIO visited a number of companies and came away with some useful lessons. “One thing we decided,” says Meador, “was that the project should not be led by finance or IT, but by a line executive, with us acting as a kitchen cabinet.”
Finance and IT also worked together to develop a standard template for technology proposals, one based on risk-adjusted returns. Projects that meet a certain threshold win funding, while those that don’t are dropped. “It creates a certain tension,” says Meador, “but it also fosters respect.”
Cross-pollination among finance, IT, and the business units takes several forms: business-unit controllers work with vice presidents to develop business cases for IT projects before they are presented to senior management, and one of Ellyn’s staff members works with a controller in much the same way. She has also had IT staff leave her group to go into corporate audit and other finance roles. “Sometimes it’s hard to distinguish between who’s in IT and who’s in finance,” she says.
That’s also true at Sun Healthcare Group Inc., an Albuquerque, New Mexico-based operator of long-term and postacute care facilities and related products and services. While CIO Bruce Stabile reports to CFO Kevin Pendergest, he also has daily contact with controller Jennifer Botter. “I bless the day she came,” he says, “because she brought financial prowess to the implementation of two major software packages.”