In today’s AI-driven environment, the need for organizational alignment is even more important today. According to a Forrestor survey, 95% of surveyed finance and IT leaders agree that strategic alignment between finance and IT is critical to transformation success.
However, siloed operations continue to persist across organizations which can lead to a disconnect between back-office and front-office operations, siloed decision-making, and reduced ROI on tech spend.
Why is finance and IT alignment important?
Technology is constantly changing and failure to keep up with the latest innovation can mean a loss of competitive advantage for an enterprise.
Enables enterprise digital transformation
IT not only implements and maintains new technology, they also serve as thought leaders in identifying emerging technologies that could create or enhance competitive advantages and improve operational efficiency.
On the flip side, finance analyzes the potential return on new high-impact digital initiatives, monitors financial aspects of digital products, defines and tracks financial KPIs to measure the impact of digital transformation.
Both departments play a critical role and their joint impacts help to ensure digital initiatives align with long-term business goals while balancing operational feasibility and capability.
Prevent organizational silos
Siloed operations can result in duplicated efforts, wasted resources, and act as a drag on innovation progress.
In order for technology to be scalable, mutual accountability and investment in technology must be agreed upon between departments. Especially when it comes to digital initiatives requiring cross-functional collaboration, like upgrading or replacing old legacy systems,
“84% of IT and finance leaders agree that unified governance and understanding of policies is the top determinant of success” (Forrestor).
Need to achieve more with less
Downward pressures on budgets due to macroeconomic changes can force finance teams to cut funding across departments, with unintended consequences if budgets are allocated incorrectly.
Most finance teams do not have visibility into which software is critical or redundant within IT’s environment. An incorrect judgment call may result in incorrectly cutting funding to high-value projects and harming the company’s long-term growth.
How can finance and IT improve alignment?
Platform for shared processes and accountability
Digitally mature companies utilize a common platform that connects and expands the governance of technology across their organization.
It’s essential for the platform to be capable of:
- assisting in developing shared accountability across all functions
- enhancing visibility into technology consumption, adoption, and growth
- measuring and identifying critical and value-driving applications
The platform is aimed to provide data to both departments that wasn’t previously available before in order to improve coordination, align objectives, and make better informed decisions between both teams.
Looking for a platform to improve Finance and IT alignment?
Check out Trufflow
Cross-department training and planning
To reduce cross-department friction, finance and IT must learn to be able to speak each other’s “languages” to better understand each other’s goals and objectives.
This may require upskilling through hands-on workshops, such as tech literacy sessions for Finance to understand how technology consumption impacts costs or walk-throughs on what factors impact IT budgeting and fund allocations.
Joint planning sessions between IT and finance to align on project prioritization, funding, and business needs present opportunities for departments to align strategies as a whole.
Feedback loops
Regular review and debriefs on completed projects are important to assess performance of complete digital initiatives.
Continuous tracking of KPIs post-implementation is equally important as during implementation. Evaluating strategic objectives to KPIs that assess financial and technological outcomes will reinforce alignment and identify areas for improvement.
The Trufflow Advantage
Trufflow is a software platform that makes it easy to tie business value to enterprise software, including homegrown applications, commercial SaaS offerings, data, and everything in between. The Trufflow platform provides IT product owners key metrics used across the software industry like active user counts, month-over-month revenue retention, and churn. With Trufflow, you can increase the efficiency of your technology spend and gain unprecedented visibility into your IT value chain.
