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Finance vs. IT: Who Runs The Numbers?
Your article "One Way, or Another?" (Winter 2004) struck home. Having been in finance the first 10 years of my career and marketing the last 10, I've dealt with many of the same issues. In particular, I was interested in the results from your poll stating that almost 50 percent of finance people feel that the demands of Sarbanes-Oxley have fostered a closer working relationship between finance and IT. In light of Sarbanes-Oxley, it seems imperative that CFOs be comfortable that they have control over all areas that affect their ability to produce financial reports of the highest integrity. A look at the balance of power between finance and IT [given that the business-intelligence and reporting systems, and the staff that use them, tend to cross these boundaries] would make a great follow-up article.
Charlie Cary
Via E-mail
Regarding your Editor's Note and article "One Way, or Another?" I would like to congratulate you and your magazine for doing what all business magazines should be doing: making us think about the issues—all the issues, no matter how painful. As your headline indicates, "CFOs agree on the value of IT but disagree on how to measure and manage it." This alone gives us all an indication of just how complex the issues really are, and the impact they have on the companies we serve.
George B. Tselentis
Via E-mail
In Praise of Fuzzy Advantages
I must confess to being perpetually perplexed that so many CFOs insist that major IT projects show a positive ROI. After all, these are fairly smart people by and large; surely they cannot think that all that is involved is directly measurable.
While there are point solutions that certainly have real-world ROI, the ROI meter is too often used to make decisions on major projects, like ERP software, and this simply does not make sense. ERP projects (as well as CRM and others of that ilk) both affect and are affected by so many intangible factors that measuring hard numbers just doesn't make sense.
Of course, there are plenty of problems in the implementation phase, and to blindly throw money at a project without regard for payback is a fool's errand. But the CFO/financial community must come to grips with the fact that there are IT projects that are not all about solid figures. Perhaps the trick is to identify the ones that can be better measured, and not expect so much calculated ROI for the projects that have fuzzy advantages.
Frankly, I wonder how many of the CFOs who insist on ROI today would have approved [the purchase of] spreadsheet programs years ago—the very spreadsheets their assistants use to calculate ROI!
Bob Fately/Third Wave Int'l
Van Nuys, California
How to Measure IT's Contribution
Regarding the notion of estimating how much revenue to allocate to every kind of corporate resource in proportion to each respective resource's contribution ("Revenue Is What Matters," Letters, Fall 2004), I have to wonder what purpose there is to that. Not being an economist myself allows, perhaps, my view on this matter to spawn a useful question. Namely, without a definition of "contribution" there is no logic to the presumed "proportion," and don't we already know from real life that contribution means impact and that impact is defined by the system of measurement?
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