While chief financial officers have a reputation for cutting spending wherever they can, they’re changing their tune when it comes to technology. Even with reduced spending across the company budget, CFOs are boosting their investments in information technology. One of the greatest recent examples is CH2M Hill in Englewood, Colorado. This engineering firm decided to reduce its budget for corporate events and even lessened employee bonuses, yet the company is increasing its $100 million-per-year technology budget by nearly 20 percent.
Why the discrepancy? Because finance executives are now seeing technology as a way to deliver greater competitive advantages both internally and externally. Not only does technology boost company efficiency, but it also gives companies the opportunity to collect crucial data and information. In short, CFOs should see two primary benefits for technology:
- Greater ability to harness and analyze data
- Increased efficiency in all workflow processes
First, CFOs must also remember that in some circles they’re viewed as both advisors and consultants. For instance, the head of the sales or HR department will look to the CFO not only for data, but also for analysis on how that division can increase revenue or better control their costs. With technology, CFOs have the advantage of real-time insight and analysis on the latest financial performances. More specifically, CFOs have the ability to give the sales team detailed insight concerning their customers, cost of acquiring customers, how much each customer is spending, etc. Instead of simply showcasing a lot of data, technology provides the ability to analyze the most up-to-date information.
Furthermore, technology such as Cloud services greatly enhance company efficiency by improving communication, collaborating, management, storage, scheduling, and other functions. While technology such as Cloud is an incredible tool, CFOs must also be highly involved in the process. It isn’t enough to simply boost investment in technology; instead; CFOs must also ensure that it’s being used properly.
Technology such as Cloud must be able to protect company and customer information. It’s important to ensure that contracts with any services address data privacy and security. As IT spending is increased, CFOs must consider:
- Limitations on liability, particularly for information loss
- Meeting legal and regulatory privacy standards
- The ability to change, negotiate, or modify service features