The collaboration between finance and IT is pivotal to any organization looking to grow, said Jim Caci, CFO of software-as-a-service (Saas) and data management platform provider AvePoint. Caci believes IT and finance should leverage each other's skills to create a partnership, expanding their relationship from functioning as organizationally adjacent to being fundamentally intertwined.
“When [finance and IT] work together to evaluate the business case for a new investment, it ensures the CFO and the rest of the finance can provide strategic advice and act as more than just the budget gatekeeper,” said Caci.
This collaboration may include a unified cost and projected benefit analysis and an evaluation of the risks and rewards of a proposed investment. As a result, the decisions IT and finance make together are more strategic as opposed to task-oriented.
Seventy-eight percent of CFOs say they are already actively collaborating with IT on things such as cloud platforms, advanced analytics, automation, and other technologies that aim to increase the performance of finance and accounting, according to a recent CFO survey. But it’s not just about collaboration, according to Caci, but the execution of the ideas that stem from those partnerships that bring true value.
“The CFO should provide strategic advice when it comes to purchasing and implementing new software, [while] acting as a partner to the IT and procurement teams,” said Caci. “I would argue that today, this is a traditional CFO task. Technology has become so integral to business operations and productivity that it can and should be considered a revenue driver.”
An Open Mind GIves CFOs the Upper Hand
Caci spoke about how his experience outside finance allowed him to view his organization from another perspective. That kind of experience is a priceless skill set for a CFO, allowing them to analyze and understand the needs of the business from a department or function outside of their own.
“Technology has become so integral to business operations and productivity, that it can and should be considered a revenue driver.” — AvePoint CFO Jim Caci
“I believe the best CFOs have spent time in operational roles outside finance,” Caci said. “At one point in my career, I oversaw the sales organization, which gave me a well-rounded understanding of the business and the challenges and opportunities within that department, and that perspective has continued to serve me.”
As tech-savvy CFOs become more prevalent, Caci stresses the importance of not only having the skills to plan and achieve growth but also the ability to be a sponge, learning at every opportunity and combining those moments with key critical thinking skills to develop the skills needed to execute.
“The CFO should provide strategic advice when it comes to purchasing and implementing new software, acting as a partner to the IT and procurement teams.” — Caci
“A common misconception I hear all the time is that the CFO’s job is to simply hold the purse strings, asking questions like ‘what will it cost?’” said Caci. “That’s not true at all. I have often said the finance department in any organization should be the source of truth [while having] the ability to discern the business justification for any investment or strategy.”
Allocating Towards Cyber Security
One major thing to keep in mind for companies hoping to achieve success with technology integration is cybersecurity, Caci said. Adding data protection software is critical for companies growing rapidly.
“The average cost of a ransomware attack is in the millions of dollars, something that a company looking to grow cannot afford,” said the AvePoint CFO.
The initial step is the hardest part of cybersecurity. Across industries, CFOs are realizing reliance on technology must come with strong cybersecurity protocols to protect the business, its customers, and its partners. Justin Schumacher, the chief financial officer of multi-cloud backup service HYCU, believes investments in cybersecurity must coincide with any investments in technology for organizations that want to keep their data secure.
“Technology is still the cornerstone for protecting and securing data,” Schumacher told CFO. “As organizations use more applications, including software-as-a-service platforms, and need to store their critical data in the cloud, investing in the right technology to support them is extremely important.”
“While investing in security and data protection may come at a cost upfront, the price is significantly lower than recovering from a data breach.” — HYCU CFO Justin Schumacher
There are two initial steps for any company looking to prioritize data security, Schumacher said.
“Companies must first ensure they have a comprehensive inventory of critical systems and data; then they need to ensure they have an effective strategy and solution to back it up. They should save three data copies — store two on different storage media or locations and keep one copy offsite or in the cloud.”
With data breaches occurring almost ten times a minute, cyber attacks are the focal point of conversations with Schumacher’s security and IT teams. He said the most successful businesses have a balance of allocation — when they invest in new technology they develop strategies around preventing a cybersecurity breach of the new system.
“Investing in managed security service providers or backup as a service can benefit businesses of all sizes, especially those that are growing quickly and may have limited IT management bandwidth or resources,” he said. “While investing in security and data protection may come at a cost upfront, the price is significantly lower than recovering from a data breach.”