Dive Brief:

• Effective CFO-CIO communication is essential for organizations seeking to avoid the potential pitfalls of major technology investments, according to Gartner analyst Emily Riley.

• Digital investments tend to require a high level of collaboration due to their complexity and cross-functional nature, Riley, a senior research director at Gartner, said last week at the company’s 2023 CFO & Finance Executive Conference near Washington, D.C. 

• “Our research has shown that strong CFO-CIO relationships lead to measurably better digital spending outcomes,” she said.

Dive Insight:

A survey conducted by Gartner in December 2021 found that strong CFO-CIO relationships were 51% more likely to easily find funding for digital initiatives, 39% more likely to keep digital spending in line with a budget plan and 18% more likely to achieve intended business outcomes.

However, only 30% of CFO-CIO relationships were viewed as strong partnerships.

In the “70% of organizations that don’t enjoy a strong CFO-CIO relationship, we actually see some really counterproductive and unpleasant tendencies — finance and IT functions whose objectives just seem to be at odds; unproductive interactions; and a general lack of clarity around what the organization's digital aims are and how they plan to get there,” said Riley, who specializes in growth investments and cost structure management.

Colgate-Palmolive saw a decrease in duplicative digital investments across the New York-based consumer products company after its CFO and CIO began working to strengthen their relationship, according to a Gartner case study developed through interviews with the two executives.  

The relationship-building process included steps such as “shared priority mapping,” in which the duo identified areas where their technology goals were in alignment.

“Naming that alignment can help finance and IT identify opportunities for greater collaboration,” Riley said. “At the same time, this mapping exercise surfaces where the real gaps and misalignments exist between finance and IT’s priorities.”