• Technology
  • CFO.com | US

What CFOs Really Think about Technology

Real-time analytics remain at the top of the technology list for finance chiefs. They're also spending more time in the tech department than ever -- and bringing their yardsticks with them.

That’s another of the findings from the CFO Research Services/Getronics survey. The executives in the poll say they spend, on average, nearly 16 percent of their time on IT issues. Finance managers at larger companies — revenues between $5 billion to $25 — spend even more time on technology. Indeed, within the next three years, CFOs at some large companies will likely be spending 20 percent of their time dealing with IT concerns. Martin Slursarz, senior vice president of finance at Discover Financial services, says technology issues already take up a quarter of his work time.

The reason for this uptick in attention from finance staffers? For starters, more companies are outsourcing technology functions these days. Choosing the appropriate vendor — particularly one that won’t go belly up in six months — requires the due diligence skills of an investment banker. That’s not an expertise many CIOs possess. “We’re working more with partners and outsourcing as opposed to doing everything ourselves,” Slusarz notes. “So vendor selection is critical.”

Choosing the right platform is also crucial. Many CFOs report that their companies are moving back to a centralized, thin-client computing architecture. The switch from information fiefdoms to open data systems requires a meticulous, detail-oriented kind of mind. Sound familiar? William Graber, senior vice president and CFO at McKesson Corp., says numerous acquisitions have left that company with a hodgepodge of applications, operating systems, and databases. “Over the past 18 months,” Graber says, “we have used a much more rigorous process to put consistency in our infrastructure, both applications and data centers.”

Graber says centralization is helping McKesson management better gauge the return on its technology investments. Indeed, 86 percent of the respondents in the CFO Research/Getronics survey said they use at least one financial metric to measure IT funding. Some 64 percent of the finance managers said they use a straightforward ROI calculation to assess tech projects. About the same number indicated they use payback period to measure their tech investments. Only 42 percent said they look at internal rate of return numbers when evaluating IT spend. Interestingly, about one in three of the finance managers in the survey said they use EVA to help make investment decisions. What’s more, 15 percent of the respondents indicated they use EVA as their primary finance metric for evaluating IT projects.

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