CFO of IT Competency Model

CFO of IT establishes the framework for managing IT-related investments and fund innovations that deliver competitive advantage. The CFO of IT role builds upon the foundational practices of accounting and expense management — what we call the Technology Controller and Cost Optimizer roles — to drive the greatest returns, improve business alignment and accelerate change for their enterprises. The CFO of IT — or whatever the title of the executive who leads the business management of IT — is not just a financial leader; he or she often is essential to the success of the technology organization and the business that depends on exceptional technologies and innovations. An effective CFO of IT (or the equivalent) fulfills at least five different roles, as described by the Competency Model below.

source: TBM Council

Technology Controller
The top five functions of the Technology Controller role are:

• Govern and manage IT financial planning, budget and forecasting
• Charge and/or show back to the lines of business their consumption and cost drivers to influence consumer behavior
• Manage the system of internal controls and financial policy compliance to allow value preservation
• Provide a thermometer of spend and investment to improve IT’s credibility with the CFO and Chief Operating Officer (COO)
• Drive total cost of ownership (TCO) and transparency

Challenges

• Roles, responsibilities and processes are often missing for this role. This is exacerbated by frequent organizational changes within the C-suite.
• The data needed for strong controllership often is missing or the quality of data is poor, and processes for data governance often are insufficient or non-existent.
• Strong financial acumen often is missing within the IT organization. IT leaders need more financial management training.
• Lines of communication regarding financial matters often are unclear and the metrics needed for managing financial outcomes (between stakeholders) are missing or poorly defined.

CFOs of IT will have to drive improvement in these areas; they will not be able to count on others to do so. Strong leaders can define this role, implement the systems and data needed, roll out an education program for their IT leaders, establish metrics and formalize reporting. This role is foundational to the CFO of IT. When the Technology Controller role can ensure accuracy of the data and integrity of the processes, he or she builds trust with IT and the business.

A strong CFO of IT will do more than manage the IT budget. S/he will also direct the strategic and operational financial planning processes for the IT organization, create a better understanding among the executive team of the intricacies of IT cost structures and investment strategies, develop a solid approach to communicating the IT financial picture to the entire business community and educate business partners about the cost and value of IT.

While “IT finance” is the focal point of the CFO of IT, many of these executives play additional roles. With their ability to dissect the financial picture of large vendor contracts, some CFOs of IT function as head of the vendor management office. Likewise, when it’s time to upgrade finance systems, the CFO of IT is often asked to lead that program.