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How the CFO can sell boardroom success

The value of a business-focused ERP implementation is often underestimated, and more often than not this is due to a lack of understanding of what this investment means for streamlining businesses processes. Typically, this education process falls to the organisation’s CIO – and whilst the CIO does need to take primary responsibility, finance can bring valuable insight to the process of designing a new ERP system. 

Two becomes one

A critical success factor highlighted in the report is the need for a partnership between the CFO and CIO. The CFO should be aligned with the ERP vision the CIO is pitching to the board and other executive stakeholders to secure funding and support for the project. The advantage of a CFO and CIO partnership is that the CFO can expertly explain business needs and demonstrate how a modern ERP can be used to support these, leaving the CIO to explain best practises for design and implementation of the ERP system.

However, not all CIOs are jumping at the chance to work closely with their CFO. According to the Gartner report, there are four types of CIO: At-risk, transactional, partner and trusted ally. If you are the CFO, you want to collaborate with a trusted-ally type CIO to get the ERP system you want and the business needs. The other types are more likely to be comfortable sticking to talk of technical details and vendor choices in light of strained resources. Those messages don't resonate with stakeholders and aren't likely to inspire approval of the proposed ERP project.

On the other hand, the CFO is seen to have a strategic view of the business. The CFO can explain business needs and demonstrate how modern ERP could meet those needs with supporting metrics that can make decision-makers sit up, take notice, and feel the urgency and relevance of the project.

Demonstrate the value of ERP to high-level decision-makers 

In many cases stakeholders tend to have an outdated view of ERP systems as transactional back offices systems used to drive standardisation, centralisation, and operating efficiencies. They don't recognise modern ERP for what it is today, a digital business enabler. While those benefits are still relevant, today's board members are more focused on digital business than cost savings, so making the connection between a modern ERP platform in the cloud and digital business success is vital. As Gartner says, "Postmodern ERP focuses on business strategy and business outcomes. Your presentation to the board must do the same.”

Whether you are making the case yourself or helping the CIO craft theirs, prepare to explain the benefits, new capabilities, and impact on shareholder value. Your role as CFO is to keep coming back to what the ERP implementation means for your organisation and shareholder value.

Maybe you can free up resources to focus on more strategic activities and to deliver differentiated value. Perhaps you're looking at acquiring new businesses or have previous acquisitions to integrate. You need to quickly and effectively onboard those businesses and provide a smooth integration process to accelerate time-to-benefit. There may be an opportunity to monetise corporate data through new service offerings, or it just might mean that you can get a new product out the door and into the market sooner, thanks to new technologies, robust core systems, and the data that feeds them.

Transform your ERP strategy

CFOs and CIOs together have the ideal skills to construct a business strategy-first approach to ERP. Per Gartner, “CIOs who take a business strategy-first approach to ERP will deliver 60% increased business value over those who take a vendor-first approach.” As CFO, you can act as a sounding board for your CIO—keeping them from the classic CIO pitfall of presenting technical details that risk losing the value-focused stakeholder audience.

Especially critical is your ability and credibility in helping communicate to decision-makers both the positive consequences of taking action and the negative consequences of inaction. There is always the temptation to delay or scale down a new technology investment to save costs, and you're likely the best person in the organisation to address that objection. As an adjunct to the CIO's presentation, prepare the tangible business and financial justification for acting sooner rather than later, and create the appropriate sense of urgency. It is inevitable that the board will suggest delaying the project, you should be prepared to field these questions and suggestions. 

ERP solutions are powerful and potentially game changing for an organisation. While the cloud has helped alleviate some of the challenges, they can also be complex to design, implement, and maintain. Your ERP implementation is likely to consist of multiple programs and projects, delivering measurable business value over time. Make sure that your CIO sets this expectation correctly and be prepared to offer backup with metrics and milestones that help stakeholders understand that ERP is an ongoing strategy, not an individual, one-time project. The good news here is that there will be a continuous stream of innovation coming from the ERP cloud provider as, the days of the big, expensive, and disruptive upgrades are over.

Armed with a well-crafted strategy and all the anticipated answers, you can enter the boardroom with your trusted CIO ally and present an ERP implementation that even the toughest stakeholder can’t refuse. 

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Debbie Green

Debbie Green

VP of Applications

Oracle

Member since

06 Nov 2019

Location

London

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