MALAYSIA – Rimini Street, Inc., a global provider of enterprise software products and services, on April 28 revealed findings from a recent global survey of more than 1,500 CFOs and senior financial leaders across 13 markets covering most industries, including participation from more than 100 Malaysia-based CFOs.
The survey was conducted to identify CFO’s perceptions of digital transformation, their IT spending priorities, how they measure the ROI on technology investments and their viewpoints on the CFO-CIO partnership.
CFOs Are Bullish About Digital Transformation
According to the survey report, digital transformation is a top CFO priority, with 73% CFOs globally (80% of Malaysia CFOs) noted that the pandemic increased their digital transformation investment, and 95% (95% in Malaysia) agreed that tech investments are vital to recovering from COVID-19.
CFOs See Clear Business Value and ROI from Optimizing Existing Technology Investments
CFOs believe that IT spending must be tied to business value, with 77% (79% in Malaysia) will fund digital transformation initiative with strong ROI. Additionally, 40% (54% in Malaysia) prefer IT projects that generate revenue, 44% (42% in Malaysia) prefer optimising existing investments, and 39% (39% in Malaysia) prefer improving process and efficiency.
One of the CFOs’ primary considerations for IT spending is prioritizing those projects that yield positive business outcomes, therefore 77% refuse to waste precious dollars on IT investments that don’t “move the needle” for their business and 79% of CFOs will fund digital transformation initiatives with strong ROI. In addition, 61% want to cut spending on non-essential IT investments.
“CIOs that continually optimize their IT operations are in a strong position to create and secure new funding for strategic IT investments that are aligned with business priorities. As a result, IT resources – including time, money and personnel – can be reallocated to critical new revenue generating initiatives that create competitive advantage and growth for their organization,” the survey stated.
A Strong CFO-CIO Partnership is Critical to Success
On the topic of CFO-CIO partnerships, 92% of CFOs (95% of Malaysia CFOs) agree that a successful CFO has a great relationship with their CIO counterpart while 77% (67% in Malaysia) have improved their relationship with their CIO in 2020.
Technology is expanding the role that CFOs and CIOs play in an organization, as well as the need for a close collaboration between IT and Finance. Today’s CFO and CIO must have a solid understanding of customers and markets and technology’s role in connecting them.
For those CFOs who noted a worsening relationship with their CIO last year, a few reasons cited include the CIOs presenting plans with no demonstrated ROI (54%) and inflexibility on cost cutting (46%).
“With digital transformation high on the priority list of most CFOs, a strong CFO-CIO partnership is more important than ever. This means financial decision makers should learn the language of technology, and to be successful, CIOs must learn more of the CFO mindset. In a broad context, whether it’s digital transformation or infrastructure, this means taking a critical look at operational expenses and treating every line item in the IT budget as one that should demonstrate value,” the report concluded.
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