The economics of IT is changing: aligning the C-Suite

The ongoing wave of digital transformation is radically altering the economics of IT, reshaping how organisations allocate resources, measure success, and achieve business outcomes. At the heart of this evolution lies a critical dynamic between two key players in the c-suite: Chief Information Officers (CIOs) and Chief Finance Officers (CFOs). Both are fundamental to driving value and they have a shared goal, yet they often approach IT investments from vastly different perspectives, creating friction that can hinder progress.

 

CIOs are under pressure to use technology to spark innovation and drive outcomes that genuinely move the needle. CFOs, on the other hand, need to make sure those ideas fit the budget and deliver measurable ROI. It’s a natural push-and-pull; CIOs focus on what users need; CFOs focus on what the numbers say. So how do we get both sides to speak the same language?

 

 

A disconnect between cost and value

One of the biggest sources of friction between CIOs and CFOs comes from how differently they define value. For many CFOs, the CIO/CTO are their most critical partner, with 72% saying this relationship is highly important or essential. Yet their priorities often diverge with CFOs driven by cost discipline and measurable ROI, while CIOs measure success by how effectively technology improves end-user experiences and enables business growth.

 

For example, a CIO may implement a new application that sees user adoption soar. From the CIO’s perspective, this is a clear win; the technology is delivering value. But as more users engage with the platform, the associated costs inevitably rise. If this increased consumption isn’t paired with a broader understanding of its business benefits, CFOs may see the initiative as a budgetary concern, rather than a success.

 

This misalignment is not just a matter of differing priorities; it’s the result of siloed data and metrics. According to IBM’s Data Differentiator, 82% of enterprises report that data silos disrupt their critical workflows, and 68% of enterprise data remains completely unanalysed. This can be the result of CFOs looking at IT costs in isolation, while CIOs focus solely on consumption and outcomes. Bridging this gap requires more than just collaboration; it demands tools and frameworks that bring financial and operational data together.

 

 

Breaking down the silos

To foster alignment, organisations need the tools to translate their priorities into a shared framework. Technology Business Management (TBM), for instance, acts as a translator between CIOs and CFOs, mapping IT initiatives to business outcomes while connecting cost and value in a meaningful way. By uniting financial and consumption data, TBM helps demystify IT investments, ensuring both teams see the full picture.

 

A unified framework also enables better communication around ROI. When CIOs can show how increased costs drive higher business performance or when CFOs can see clear financial metrics tied to IT outcomes, decision-making becomes less about compromise and more about collaboration on business goals.

 

One example of where we’ve seen this addressed well is through our work with the Bank of Ireland, which was struggling to bring all of its data together to better manage costs for its entire technology estate. By implementing robust application portfolio management strategies, the bank was able to make smarter decisions around investments. In just the first year, this led to a 15% reduction in applications and €2.5 million in savings from optimised contracts, reduced licenses and more efficient operations.

 

Going beyond the IT, these data-driven insights shaped broader strategies across the business, influencing resource planning, risk management, and importantly encouraged a more collaborative approach across teams.

 

 

The steps to alignment

But the work doesn’t stop there. Teams will also need to take further steps to ensure cohesion is achieved and this includes establishing clear and shared metrics. Companies must redefine ROI evaluations to align with both IT and finance goals. Metrics should incorporate not only costs but also usage, performance and business outcomes to create a more well-rounded view of value.

 

Secondly, data needs context. Silos exist because of fragmented data ownership. Organisations need systems that merge operational data (like consumption and performance metrics) with financial data (like costs and budgets). This creates the transparency CFOs need while giving CIOs the insights to demonstrate value.

 

Finally, this isn’t a one-off exercise. Assigning a cross-functional team to oversee the value management of IT investments will serve as the bridge between finance and IT. To ensure that both sides work from the same numbers, there needs to be regular check-ins and a shared language which reflects the broader business impact of their decisions.

 

 

A relationship growing in importance

As digital transformation and the expansion of AI continue to change how businesses operate, the relationship between CIOs and CFOs will only grow in importance. By using shared frameworks, improving data visibility and keeping an open, ongoing dialogue between finance and IT, organisations can make sure their IT investments stay sustainable and genuinely deliver impact.

 

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Mallory Beaudreau is RVP, Account Management at Apptio, an IBM Company

 

Main image courtesy of iStockPhoto.com and nortonrsx