August 18, 2022

Business Update Blog

Do you have ‘trust issues’ with IT? It’s a problem in

Good morning,

Companies are increasingly seeking tech-savvy CFOs. But that doesn’t guarantee that finance and IT teams will be on the same page when it comes to major projects.

A lack of finance-IT alignment was ranked as the top barrier to digital finance transformation, according to a new study by Workday (sponsor of CFO Daily), based on a global survey of 1,060 senior finance and IT leaders in 12 industries. Almost half (41%) of finance leaders admitted that their chief information officer (CIO) doesn’t have a seat at the table during important finance meetings, even when technology is a key part of solving a challenge.

“One of the things that finance increasingly owns is the data strategy or data model, as well as the business strategy,” Workday CFO Barbara Larson said in the study. “But we can’t do that alone. “It’s absolutely critical to have that partnership with IT to drive the data strategy, which will fuel the business strategy.”

“Speaking from an IT perspective, we want to build not just a trusted relationship with finance, meaning ‘I trust that IT can do the technology,’ Ernesto Boada, interim CIO at Workday, told me. “But we want to be able to build a strategic relationship as well, and we need people to be open to having those discussions.” Boada joined Workday in 2021, previously an SVP and chief technology officer at Western Union.

The research found there’s a positive correlation between high finance and IT alignment, and the increased digital maturity of a company’s finance digital transformation.

As some finance leaders are slow to include IT in finance planning, even in a digital era, it may point to a perception of IT that has existed for decades.

“Big, classic Fortune 500 companies have the same problem they had 20 years ago,” Marc Andreessen, tech entrepreneur and co-founder of Andreessen Horowitz, recently told McKinsey & Company in an interview. “I thought the problem would shrink over time, but I’m not sure it has. The true technologists inside so many big companies are not the primary people at the company. They’re not treated as first-class citizens.”

Yet, there’s also the case that IT should be more inclusive of different perspectives on technology. About 57% of CIOs agreed that their goal to eliminate IT complexity is “directly at odds with expanding the scope of the finance function,” according to Workday’s study.

Boada says there’s a “close partnership” between Workday’s finance and IT teams. “I think for us, it’s key to kind of put the cards on the table,” he says. “Because their success is going to be our success.” And it goes beyond just finance coming to IT with technology-related questions, he says.

For example, Boada will be in preparation meetings to discuss finance initiatives, he says. And the finance and IT departments participate in innovation roundtables where they discuss topics that are trends in the market and figure out a product solution that could be built. They’re also working together to achieve a zero-day close, which means automating as much of Workday’s financial close as possible. 

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“One of the biggest surprises for me [in the study] was the fact that there’s still a large percentage of lack of confidence in the data used at organizations, and CFOs and other finance individuals are making decisions using their own gut,” Boada says. About 51% of finance leaders said they must use their instincts to make decisions because the data is siloed, not in the correct format, or not readily available.

The CFOs and CIOs surveyed did agree that there’s a strong need to increase cross-functional finance and IT skills training. “It’s helpful because we can at least evaluate technology and processes together,” Boada says. Communication and effective data management are key to building trust in the relationship, he says.

See you tomorrow.

Sheryl Estrada
[email protected]

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