Smart IT | March 2013 Digital Edition

Making the CFO Your BFF

Forging a connection between technology and financial leaders is key to any digital transformation.

This article, with an exclusive video interview, originally appeared in T.H.E. Journal's March 2013 digital edition. Smart IT is a new quarterly column examining ways that district technology leaders can navigate digital transformations, both strategically and tactically, in an era of limited budgets.

What enables some school districts to always find the financial resources for technology, while many (perhaps most) districts never truly get beyond vision statements? Increasingly, the evidence points to the importance of building a strong partnership between your chief financial officer and your chief technology officer. That partnership seems to be the "secret sauce" that can go a long way toward enabling a digital transformation. So if you're a CTO, a crucial question you must answer is, in today's language, how do you make your CFO your BFF? (In case you have been working in an educational time warp, BFF means "best friend forever.")

Education is not the only industry in which CTOs and CFOs don't always see eye-to-eye. A quick search of technology publications provides an avalanche of evidence that inter-departmental communication is a major problem in other sectors as well. (See the sidebar for examples.) Typical complaints about IT from the financial side of the house include the following:

  • Inability to align technology to the mission of the organization (which in education must be learning)
  • Failure to show the value of investments in technology
  • Lack of a common language and an overreliance on techno-speak when communicating about technology

Similarly, I constantly hear grumblings from frustrated CTOs who can't get the resources to implement their visions because the CFO is implementing across-the-board cuts or doesn't see value of new technology investments.

I could launch into a litany of other challenges and complaints from both perspectives, but let's focus on what some innovative district CTOs are doing to change that situation. I recently spoke to key leaders in my organization, the Consortium for School Networking (CoSN), as well as the Information Systems Committee of the Association of School Business Officials International. I asked them all a simple question: "What works in building an effective CFO/CTO partnership?"

Creating Trust
Ed Zaiontz, the recently retired CTO of Round Rock ISD near Austin, TX, actually reported to the CFO. Thus, in his situation, building a personal relationship was absolutely key. Zaiontz recalls,"I went to lunch with the CFO on a regular basis--once every two weeks or so. This gave me an opportunity to make sure he/she was up to speed on technology initiatives."

Ray Eernisse, chief information officer at Francis Howell R-III School District (MO), stresses personal as well as professional connections. "The great relationship I have with my CFO starts by having dinner every month with our partners/spouses," he says. "On the professional side, I attend his monthly meeting with his department leaders and provide updates on IT projects involving finance. We share articles of interest in both of our areas of responsibility. When we speak to groups, we each reference the others' work. For example, if he is speaking about ways to use resources more efficiently, he references my work on managed print services. This shows mutual respect and inter-dependency."

Vince Humes, director of technology solutions and services at the Northwest Tri-County (PA) Intermediate Unit, reinforces this need for building trust but cautions, "I wish I could say there is one definitive thing that a CTO can do to make the relationship work with the CFO. The reality is it takes concentration at every turn to make it successful. In my situation it has worked because we are completely honest with each other on financial matters."

Small districts, like Masconomet Regional School District (MA), often have technology leaders reporting to finance, says CFO Susan K. Givens. In Masconomet's case, the IT director (who is charge of technical issues) and the technology coordinator (who is focused on teaching and learning) both report to her. While that arrangement increases the collaboration between departments, it also raises challenges at the strategic level. For the partnership to really work, CTOs and CFOs need to be peer colleagues, even if one reports to the other. Being part of the school district cabinet level is essential if CTOs want to leverage technology's potential to improve teaching and learning.

Demonstrating the Value of IT
But, for IT to have a place at the strategy table, the CTO must first change the perception of IT "from cost center to 'productivity center,'" says Rich Kaestner, director of CoSN's Smart IT initiative. "This is absolutely essential during tight budgetary times to move from slashing technology to investing in technology."

CoSN has launched two initiatives to help CTO and CFOs objectively evaluate technology investments: K-12 Total Cost of Ownership (TCO) and the Value of Investment Leadership Initiative. The VOI initiative, designed to help school leaders better understand the costs and benefits of proposed technology projects, includes CoSN's free Project Cost Estimator. Much as corporations use return on investment to evaluate the worth of any expenditure, schools should perform a similar evaluation. However, there is a fundamental difference between K-12 and business: Businesses exist to make money, while schools exist to produce knowledgeable, skilled 21st century citizen-learners. So the value you are establishing is how well the money was spent toward furthering your district's educational mission.

Humes says that his CFO has embraced CoSN's TCO and VOI models to ensure that she understands the full cost and value of technology investments. Because the CFO has this information at the start of the project, she is an ally with Humes when funding issues arise. The technology and finance departments can work collaboratively, in a way that Humes describes as "picture perfect."

Ironically, the changes in technology administration have mirrored the evolution of school finance. Just a few decades ago, every school district had bookkeepers and accountants, but few had chief financial officers. Eventually, superintendents and school boards realized that finance is a strategic initiative and they needed personnel with those financial leadership skills. We are now at a similar point with educational technology.

Unfortunately, many districts are not yet viewing technology as a strategic asset, and we have an enormous IT governance challenge. According to US Department of Education statistics, only 51 percent of districts reported employing a full-time individual responsible for educational technology leadership. Of course, 70 percent of the districts in the US have fewer than 2,500 students, but even in large districts of 10,000 or more students, nearly 20 percent do not have a full-time technology leader. In medium-sized districts, one-third of the schools do not have such a full-time position.

The statistics for this position by poverty concentration are very troubling: Among wealthy districts where fewer than 10 percent of students get free and reduced lunch, 60 percent have a full-time technology leader. That number drops to 47 percent in districts where more than 20 percent of students get free and reduced lunch. These statistics are alarming considering the universal role technology plays in our society. Our nation's schools must ensure that they have technology leaders who are able to align how students learn today with what will be expected of them in the future they'll inherit.

Stand by Me

In an article from T.H.E. Journal's higher ed counterpart Campus Technology, North Shore Community College (MA) CIO Gary Ham and VP of Finance Janice Forsstrom detailed how ensuring a successful relationship between the CFO and CIO calls for each partner to deliver specific forms of support.

The CIO needs from the CFO:

  • High-level understanding of core technologies and underlying complexities to set realistic expectations and discuss strategic options
  • Assistance in gaining buy-in for technology that meets strategic objectives, to assure wide adoption
  • Help in managing expectations, especially for projects that address long-term objectives
  • Approval of funding for proposed solutions, as well as documented analysis of service improvements, investment returned, etc.
  • Acceptance as a strategic business partner and collaborator

The CFO needs from the CIO:

  • An institutional perspective that directs technology decisions toward strategic priorities
  • A complete analysis of new initiatives that encompasses costs, return on investment, return on value, options, issues, and potential pitfalls
  • A proactive approach to communications with others in the institution and use of governance structures to gain consensus
  • Realistic assessment of current IT skills and steps to filling the skills gap
  • A business and entrepreneurial mentality

Related Readings

Building a Successful CIO-CFO Relationship: 7 Tips for CIOs from Forsythe has more advice on fostering communication between leaders.

Getting the CFO-CIO Relationship "Right" offers perspective from Deloitte and The Wall Street Journal.

The Boss and You: A Survival Guide from CIO magazine is a list of articles on CIO/CFO relationships.

The annual New Media Consortium Horizon K-12 report identifies key emerging technologies for learning.