Better Together: A CFO’s Perspective on How IT and Finance Can Partner to Provide Stability

Snow CFO James Denena offers insights into how Finance and IT teams can come together during this uncertain time to optimize costs and safeguard the business

While there are a lot of uncertainties around the future of work right now, one thing is clear – the economy is, and will likely continue, to feel the impact of the pandemic. Organizations in all industries are considering the ramifications that this could have on their businesses and adapting to the uncertainty ahead is going to require even greater collaboration across departments. As the Chief Financial Officer at Snow, I’ve been working closely with our CIO and IT team to understand and optimize our technology investments, both to rapidly provision remote work in the short term and to ensure financial stability in the long term. I know most of our peers have been facing similar challenges. Technology can usually be leveraged immensely in times like this to make a business more optimized and efficient, and much more than most organizations give it credit for. Given this, here are some of the things we’ve learned along the way that might help other IT leaders enhance their conversations with their finance partners to better position or protect changes to their strategic priorities, planning and budgets.

Understand your current investments

With business priorities often shifting around a bit, implementing cost optimization measures can be challenging, but one of the first steps for every department – including IT – is to understand exactly what your current investments and contractual commitments are. Every finance organization will likely ask about this, but we also recognize that this can be a difficult request for some teams as we don’t always speak the same language. Consider starting with simple questions like:

Once you have shared visibility of your complete technology ecosystem, the next natural conversation will be around contractual obligations including renewal dates and cancellation rights. This insight between IT and finance can be crucial and, as potential decisions are made, could shed light on opportunities to impact the bottom line by removing any redundancy or further optimizing current investments.

Dig deeper into what’s business-critical

Prioritization is certainly something that both finance and IT can relate to – whether reviewing tickets that indicate an outage versus a user error or approving an invoice before the due date. The same principle applies to the evaluation stage of a cost optimization initiative. Finance will likely ask IT to provide details on resources they deem essential, and that generally means parsing through which tools are critical to running the business versus those that may be considered more of a nice to have. You may already have this list well developed if you’ve had to recently update or revert to your business continuity plan. In addition to business-critical, we will want to understand which tools we can better leverage as a force multiplier to reduce cost and waste in the system. 

As both teams gain a clearer picture of the organization’s technology landscape, this is typically when any usage data becomes important. In some cases, by understanding usage data, finance and IT may be able to review whether underutilized resources could be used across other areas of the organization – cloud capacity for example – or if applications should be consolidated in favor of a similar yet more used tool. The more data and insights that can be shared, the more strategic and timely decisions can be.

Support scenario modeling

Most finance teams are doing a lot of scenario modeling right now. There is a strong and necessary bias towards action in this climate, and these plans allow the business to be more agile, regardless of which direction the market heads. The objectives of these exercises are to answer questions such as: How much uncertainty is out there? How long could we feel it? What is the severity of the impact that we will see? And be prepared to act quickly when visibility improves.

A few good things to know about scenario modeling from the IT perspective:

Ultimately, scenario modeling is only as good as our data. Anything the IT team can do to provide actionable, fact-based insights will result in better decision making for the business.

Focus on people and customers

In the midst of all this market uncertainty, many organizations are trying their hardest to safeguard their employees and avoid cutting staff. The best advice I can offer here is to build and maintain a strong foundation for the business with good visibility to key metrics on performance and the right financial protections and governance in place. Every function has a key role to play here, but IT is critical in ensuring we all have the right business solutions and the right data, provisioned as efficiently as possible.

Remember, efficiency isn’t always about cutting costs. If you need to propose new tools in the midst of a cost savings environment, outline how it will offer a return on investment by expanding capabilities or improving productivity. For example, buying new technologies that could ultimately free up time that an employee has been spending on manual tasks, ultimately refocusing their efforts into more strategic initiatives, certainly makes the case more compelling for finance teams.

While broader cost optimization efforts may be in consideration across the business, it’s also important that organizations never forget about how they’re serving their customers, their partners and their wider community. Investing in the resources that customer service or support teams need may be something that IT should prioritize when evaluating technology requests.

At the end of the day, the only constant is change. Navigating change effectively requires cross-functional collaboration, pragmatism and agility – all supported by powerful and shared data insights. IT teams that foster a strong partnership with finance are in the best position to help their organizations adapt quickly and securely, no matter what new challenges arise.

For more advice on how to determine what you have in your tech stack and how to assess what’s essential, check out Visibility and Agility: A Perspective on IT Asset Management During and After a Crisis.