CFOs don’t care about technology. They care about results.
Today’s Chief Financial Officers have a complicated relationship with technology. At first glance, advances in tech appear to be well outside the CFO’s realm. This is why most companies today have a CTO, after all – to take care of technology decisions so the CFO can focus on the hard numbers. Most CFOs can’t be bothered with the ins and outs of cloud solutions or virtualization engines. They’re paid to keep the company financially healthy, not get into the details of bits and bytes.
Yet at the same time, technology is drawing itself ever deeper into the CFO’s world. Profits and losses are now driven by technological decisions. Solutions which increase productivity, streamline process flows, and build strong cores of data for analysis have such a measurable impact on the bottom line that CFOs can’t help but notice them. Technology has become more than a mere business tool – it is now an investment which can (and should) be measured as part of the bottom line.
On the flip side of the coin, CFOs who ignore the benefits of technology run the risk of falling behind. Where unprofitability was once the cardinal sin for businesses, today it is failure to innovate. Staying one step ahead of transformative technologies is a form of competitive advantage in today’s marketplace – reap the benefits of increased productivity and lower cost through technology, and a business will naturally be better placed to compete.
Let’s be realistic, though. Most CFOs would rather not get too deep into the technological morass. This isn’t their main area of expertise, and to tell the truth they’d really prefer to keep their distance. Hence the dilemma of the modern CFO: how much do they really have to care about technology in the end?
The difference between the engagement of a CFO and a CTO on technology issues comes down to motivation. CTOs are focused on technology as an end in and of itself. They are looking for the concepts and ideas which make products better. CFOs, on the other hand, use technology as a driver of profit and business strength. They look for technological concepts and ideas which make the company better.
These two concepts aren’t always in competition, but they often are. Sometimes the most cutting edge technologies involve costs which just a company’s balance sheet just can’t handle. And sometimes a very basic technology upgrade can free up capital to build the core of a business. In the end, the CFO has to be involved in both kinds of decisions about technology, because they end up being fundamental to profits and losses.
The most successful CFOs are ones who can engage with technology from a strategic perspective. They aren’t dazzled by the technology itself; they are dazzled by the financial results which technology can bring about. They use technology as a driver of institutional change and competitive advantage.
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