EA Voices

In a recent Wall Street Journal – CFO Journal blog, James Wilmsen, CFO for cloud service provider XIOLINK stated “I am often surprised by how infrequently, if at all, the CFO is engaged when a company is evaluating [technology]. Many times CFOs take a back seat to the CIO or IT manager despite the inherent financial and strategic implications when evaluating investments in technology and IT services. However, the insight of a CFO can be critical in evaluating and choosing the right [technology].”

In essence, on behalf of CFOs everywhere Wilmsen is sending a message to their CIO counterparts… Help me help you!

Working in concert with CIOs and IT managers, Mr. Wilmsen believes CFOs can help IT leaders make the right decisions. He postulates there are a number of ways a CFO can add value to the technology evaluation process. A few of these are listed below.

1) CFOs can help evaluate risks. “As the chief steward of the company’s assets, both tangible and intangible,” it is critical the CFO understand the what, how, and where of a new technology investment. Mr. Wilmsen suggests “a series of meetings with the executive team of the [technology or IT Services] provider can uncover any concerns or potential issues which may later manifest themselves as poor service levels. Establishing a relationship and dialogue with them early in the process can pay dividends as the relationship grows and expands.”

2) CFOs can anticipate the potential return on investment. “The CFO is responsible for evaluating investments and processes to ensure they enhance profitability and achieve an expected return on invested capital. The right technology contributes to both arenas. Good technology, closely aligned with the needs of the business, is a long-term undertaking, requiring constant nurturing and adjustment. An investment in an initiative today could look very different tomorrow based on a changing competitive landscape, customer needs, and capital market factors. It is important that the CFO understands this dynamic and, along with the CIO, understands how an investment of time and resources with the right service provider can provide the enhanced level of flexibility desired.”

3) CFOs can help identify the organizational impact of technology change. According to Mr. Wilmsen, “at its essence, technology exists because of its ability to alter a process.” It allows leadership to “look at the chessboard of organizational capabilities and consider moves and outcomes which otherwise would not be available. The CFO should be aware of this change in process and ensure the change is one that positively impacts the bottom line, both in the near and long term. Nothing is more aggravating to a CFO than having to reinvest in technology without understanding why the previous investment did not work or why it did not last as long as proposed.”

4) CFOs can help ensure technology investment will lead to business improvement. In his blog Mr. Wilmsen writes “at the very heart of it, the CIO and the CFO have the same goal: to sustain, protect and grow the business. The CFO wants to make smart investments that enhance the value of the business. And the CIO knows that implementing new technologies with the right strategic partners can quickly impact revenue growth and enhance profitability, sometimes simultaneously. Aligning on project goals, timelines and projections increases the likelihood of a successful project, which is felt across the organization.”

In his conclusion Mr. Wilmsen states “the CFO’s involvement in the [technology] evaluation process is not done to alter the CIO’s responsibilities. Good CFOs know that IT is the CIO’s world, the one they live in every day. However, technology increasingly permeates all facets of the organization at a blistering pace. As a result, the opportunities associated with [new technologies and IT Services] begin to fall within the purview of the CFO. Because of this, a CFO who works as a partner in the process can make the job easier.

Hopefully more and more IT leaders will heed the CFOs request to “Help me help you.” And when they do, IT and Strategic Planning executives need to be prepared to work side-by-side with their CFO counterparts by delivering the IT transparency needed to make important decisions. Enterprise Portfolio Management (EPM) solutions can help deliver that transparency by showing CFOs how IT resources are spread across the enterprise, illustrating their connection to corporate goals, strategies ,and key business processes. EPM also enables leaders to identify which assets are needed and which are not, guiding them down a path to retire what’s not needed quickly and safely. In short, EPM solutions can yield the decision-making insights that help all executives help themselves.

 
The Elephant in the Room Few See
What is the single most important goal of IT Asset Management (ITAM)?  Providing the enterprise an Asset Repository comprised of all in-scope assets (“Complete”) and accurate asset information (“Accurate

<p><span style=”color: rgb(80, 80, 80); font-size: 11px; line-height: 19px;”>Last week I was proud to chair the first Belgian </span><a href=”http://pubs.opengroup.org/architecture/archimate2-doc/” style=”font-size: 11px; line-height: 19px;”>ArchiMate</a><span style=”color: rgb(80, 80, 80); font-size: 11px; line-height: 19px;”> User Group meeting in Brussels, hosted by </span><a href=”http://www.itworks.be/” style=”font-size: 11px; line-height: 19px;”>IT Works</a><span style=”color: rgb(80, 80, 80); font-size: 11px; line-height: 19px;”>. With three good speakers and a group of about 30 participants, the meeting was a big success. Hopefully we will have many more of such sessions in the years to come. </span></p><p>In this short blogpost I’ll present some of the highlights from the session. Rather than attempting to summarize the excellent talks by Jan Casteels (AXA, ING), Geert Cannaerts &amp; Christof Nikolay (both HP), and Pieter van Ostaeyen (de Lijn), I’ll stick to presenting some of the highlights.</p><ul><li>A common element in each of the three stories is “business-focused analyses”. Or, to put it differently: we spoke a lot about the type of analyses we can do for various (business) stakeholders as well as creating powerful visualizations to support decision making.</li> <li>The three speakers each used different tools (including <a href=”http://archi.cetis.ac.uk/”>Archi</a>, <a href=”http://www.sparxsystems.com.au/”>Sparx</a>, and <a href=”http://www.bizzdesign.nl/tools/architect/”>BiZZdesign Architect</a>).  The consensus seemed to be that all tools work as long as the focus is on modeling / entry of concepts and relations. A “proper” tool like Architect is needed when the focus shifts to analyses (i.e., color views, label views, generating views and cross tables, roadmapping and so on)</li> <li>There was a lot of discussion about different levels of models. <ul><li>On the one hand this refers to the difference between “architecture” and “design” (i.e., growing attentions to linking architecture models at the enterprise level to process management, business rule management, and data management at the design level).</li> <li>It also appeals to the difference between three levels of abstraction: conceptual, logical, and physical models. A crisp and clear distinction between these levels is far from easy, yet it is important to at least distinguish (and create links) between a “conceptual/logical” model and a “physical” model of the enterprise</li> </ul></li> <li>Other topics that were briefly discussed include </li> <li>The use of reference models for re-use and a head-start in creating consistent models across the enterprise.</li> <li>Starting ArchiMate modeling projects from the bottom-up. That is: rather than shooting for a top-down, enterprise-wide initiative, we see more and more organizations where the first ArchiMate models are developed in projects. This has the added advantage of adding business value early, as well as establishing good practices in modeling from the start!</li></ul><p>After a good discussions, we also found several areas where more support and guidance would be useful for the ArchiMate community at large. These boil down to the following:</p><ul><li>Easy exchange of models between tools: we see that different stakeholders and groups of professionals require different types of tools. At some point the necessity to integrate these models / to upgrade to a full-blown EA tool like Architect arises. Being able to seamlessly switch between tools is important. After all, it is about the content, not the tool.</li> <li>In line with the discussion on different levels of models, more guidance on conceptual / logical / physical modeling as well as tool support (i.e., the use of dependency relations in BiZZdesign Architect) will help the community to deal with this issue consistently and effectively</li> <li>Last but not least: in many situations it would be valuable to be able to represent the modality of relations between concepts. This goes for “cardinality” of associations, but it goes further than that. Being able to represent the fact that “a process always uses a services” versus “a process may optionally use a service” can be equally important</li></ul><p> All in all a great session with plenty of tips, real-world stories, and suggestions for taking ArchiMate initiatives to the next level.</p>