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Finding common ground in the technology system selection process


As with any significant investment, selecting technology systems such as enterprise resource planning (ERP), customer relationship management (CRM) or accounting platforms is an undertaking that requires a clear understanding of what needs to be accomplished within the organization, as well as the relative strengths and weaknesses of the available solutions within their future operating environment. The chosen strategy will affect not only individuals focused on information technology (IT), but ultimately every employee across the enterprise.

Thoughtful and informed consideration by all relevant parties must precede system selection and implementation. In addition, while an organization’s technology leader typically evaluates systems through an IT lens and the chief financial officer (CFO) views platforms from a business perspective, the two roles must find common ground to select and implement technology systems that align with the overall business strategy.

Technology system decisions should not be driven by IT; instead, they must be driven by the business. The sponsor for system selection should be the business, and that function should take ownership of it. The organizational goals should be paramount in any system selection, with the technology ultimately supporting those objectives.

The technology leader and CFO: Encouraging collaboration during technology planning

A critical component of any successful technology initiative is the leadership and ownership by the business as a whole. In the case of technology solutions, this means that often the technology leader and CFO will work hand in hand to determine which solution is best positioned to support the business requirements of teams across the enterprise. They must also take into consideration which solution provides the highest value for the technology dollar—affordable to purchase and implement, economical to operate (low total cost of ownership) and capable of facilitating long-term financial stability and growth.

System selection projects driven solely by the technology leader can lead to significant challenges if the solution does not ultimately meet the needs of the organization. Therefore, there must be shared buy-in at multiple levels of the business. To mitigate against differing points of view leading to a project delay or cancellation, the following recommendations are designed to help guide CFOs and technology leaders toward a common technology system selection and implementation strategy:

1. Determine how each technology option supports the overall organizational strategy

According to the 2016 Gartner Financial Executives International CFO Technology Study, out of a survey sample of 230 executives, the CFO authorized 13 percent of IT investments, while 17 percent of decisions were made by the CFO together with the technology leader.1 However, the group that topped the scale at 28 percent to authorize IT spend was the steering committee of IT and business-area executives.

So while CFOs are clearly interested in technology costs in both the near and long term, issues around how well each solution supports the company’s comprehensive goals for current and future operations are just as critical, requiring input from and partnership with the technology leader, who has direct access to this level of knowledge. Reaching agreement on a technology platform will require the technology leader to clearly demonstrate how each proposed solution supports strategic growth, encouraging CFO approval. This evolution of authorization by the steering committee further supports the notion that decisions around technology need to be in accord with, and support, the business strategy and functions.

2. Clearly identify solution return on investment (ROI) and set a budget early

As CFOs continue to take a more hands-on approach to technology decision-making, they are strategically prioritizing their options, and placing several technology systems high on their list of potentially transformative tools.

In the Gartner study, 31 percent of respondents cited enterprise business applications in the top three most important technology investments, with 14 percent putting them at the very top of the list.2The importance placed on these tools underscores how critical they are in delivering value to the organization. From this perspective, technology leaders and CFOs should both be looking for the same thing—technology systems that deliver the highest possible ROI.

Determining the required ROI for the business as well as the likely ROI of competing solutions goes a long way toward clarifying the value of available options. In addition, the key business objectives must be outlined with a phased approach for technology system selection and implementation. Similarly, outlining—and sticking to—a budget helps to narrow the software choices to those most likely to drive and sustain long-term growth and profitability.  

It’s tempting to use vendor data to drive ROI and budgetary assessments. However, it’s always best to arrive at these values independently, through a thoughtful, deliberate process that accounts for specific business conditions and priorities. Vendor values for ROI or budget can be a starting point, but are typically very optimistic in relation to actual business conditions, and very often fail to account for likely delays, other project impacts and resource availability

3. Consider solutions with built-in business intelligence capability

When executives in the Gartner study were asked to identify the business priority they believed most required technology support, 42 percent indicated “facilitating analysis and decision-making.”3 To this end, executives are increasingly looking to business intelligence (BI) tools to capture insights across the enterprise. Fortunately, many technology solutions provide this critical capability as a built-in feature.

For both the technology leader and CFO then, it is paramount to understand which software options include this functionality (and how deep that functionality goes), and to require vertically focused demos from potential vendor partners to determine which tool best supports the organization’s use case. Understanding both the reporting needs and the operational needs of the business prior to system selection will help the organization obtain the data it needs from technology solutions.

4. Schedule system rollout to maximize functionality and control costs

Given the potential disruption as major systems are implemented and adopted, technology leaders and CFOs should bring together relevant information from their respective areas of expertise and influence to carefully plan a timeline for project planning, implementation and support that protects against financial risks, system downtime and process changeover lag.

Gartner suggests a “pace-layered strategy” to minimize these types of integration risks, reduce costs and maximize security. Companies can categorize each business application as a system of record, differentiation or innovation, then apply differentiated management processes for each, driving more thoughtful, collaborative and high-value integrations. Under this approach, organizations can layer the rollout to get the best use and optimization from the system.

The value of executive partnership in driving technology investment

It comes as no surprise that a successful technology system deployment hinges on partnership—technology system selection must be driven by the business as a whole, instead of by IT, and CFOs still have a significant say in these investments, both individually and as a part of a group. Developing synergy among department leaders is essential to securing the executive approval, team unity and partner relationships required to implement a successful and even transformative long-term software solution.

Technology leaders and CFOs must work together to identify common objectives and ensure that the IT strategy and overall business strategy go hand in hand. When that is accomplished, the final selected technology systems typically not only meet individual needs, but are also optimally positioned to meet business requirements and operational objectives throughout the company, securing sustainable growth and profitability.

1. “Survey Analysis: Gartner-FEI Study Helps you Understand the CFO’s Technology View in 2016,” Gartner, accessed Oct. 20, 2016, https://www.gartner.com/doc/3375917/survey-analysis-gartnerfei-study-helps
2. “Gartner-FEI Study.”
3. “Gartner-FEI Study.”

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