In a recent poll of 652 CFOs and finance executives, leaders said they add the most value to IT by “managing costs and profitability”. Additionally, CFOs readily admit to not understanding IT and struggle to fully understand technology’s value in the business context. It should be no surprise then that CFOs create purchasing roadblocks and say "no" when pitched new technology investments.
But in today’s digital-first economy, the right software can unlock new levels of efficiency and profitability. Technology leadership must take ownership of this perception, get CFO buy-in and secure approval for those transformational technologies. Where IT leaders should be poised as heros in the context of the business, instead, they too often find their goals and perspectives disconnected with business decision-makers. To improve the likelihood of getting funding, IT must build better business cases for the true value of a technology.
CFOs resist IT spending when it is viewed as unnecessary, unproven, unmanaged or wasteful. In many businesses, legacy perceptions of IT being the place where project cost overruns run rampant still linger. Finance leaders are data driven and analytical; they thrive on hard fact that offers clear results and ROI attribution. Intensifying these communication challenges is that IT tends to present budget or investment asks in abstract ways or fails to connect software, infrastructure or process proposal in context of business value delivery. Such presentations inevitably invite CFO pushback.
IT leaders should reframe their approach to CFO engagement. Deloitte offers a helpful framework for these discussions and suggests key questions that align with common mindsets had by today’s CFOs:
- Catalyst: What investments is IT making or identifying as critical for future scaling of the business?
- Strategist: How is technology supporting the organization’s growth strategy?
- Operator: Is IT delivering timely and accurate data that supports the delivery of predictable outcomes and insights on revenues, costs, market share, profits, and earnings?
- Steward: How is IT managing security risks and protecting core assets? Is there appropriate governance for technology investments?
Answering these is essential, but not easy.
But with Cleanshelf, it can be. IT should leverage the benefits and insight from a full-scale SaaS spend optimization tool, like Cleanshelf.
A full-scale SaaS spend optimization tool is the best starting point for IT leaders. From SaaS app categorizing on a department level, to industry price benchmarking, growing utilization insights offering functionality to address compliance concerns like off-boarding, identity management, access to shadow IT – technology leaders can quickly, clearly and accurately make the case for a software investment.
Ultimately, the CFO wants accountability. He or she needs to know that a system of license management and ownership attribution is in place. He wants a roadmap for managing costs and a plan for license allocation. Important too, is the ongoing effort to connect spend and return; whether through dollars or hours saved or by demonstrating growth of productivity and collaboration.
This is what Cleanshelf and IT leaders can accomplish together. By using the principle of "follow the money," and offering a simple way to track and manage SaaS spend, Cleanshelf helps company leaders bridge the relationship divide and optimize software’s value return. If a technology truly offers transformative benefit, make IT easy for the CFO to say “yes”.
To learn how Cleanshelf can help IT get CFO buy-in and secure approval for new technology investments, setup a demo with the Cleanshelf team today.