The relationship between IT asset management, finance and procurement is the subject of the upcoming Gartner summit (10-11 October in London) and builds on recent research into the growing importance and inter-relation of these three topics. So with this in mind here are some thoughts from the upcoming summit that will help inform your CFO.
Any CFO is initially going to be interested in any activity with a financial impact. IT asset management specifically influences the following financial issues;
To summarise, it is best to present to the CFO that IT Asset Management feeds into the company’s financial lifecycle (Figure 1 below); at the planning stage for capital budgeting; by executing the capital expenditure policies; by supporting the management of operating expenditure through reporting; by informing the strategists who look to optimise expenditure. ITAM influences many activities within the organisation, from upfront procurement strategy right through to retirement processes.
In my own personal experience, I had a solid relationship with the IT Finance team and that relationship extended right up to the CFO who became a sponsor for one project that I ran, primarily because they saw a financial benefit. So what IT information can you provide that would gain the interest of your CFO?
A recent conversation I had with a former CEO suggested that from their perspective, IT was not a primary focus as it only represented 3% of his organisation’s spend (Gartner IT Key Metrics suggests this could rise to 15%). The percentage of spend does not reflect proportionately the risk and impact value of ITAM which is certainly a top priority for the CFO.
The IT Asset Manager will have data relating to supplier dependency and the influx of consumer technology (often they are one of the first teams in IT to be aware of spend that may have occurred outside of corporate governance / knowledge of IT). Similarly the IT Asset Manager will be acutely aware of potential for disruption to operational business activities through supplier dependence and also the opportunities that those suppliers can bring to efficiency and greater productivity. The IT Asset Manager is also likely to be responsible for IT Asset Disposal processes and certainly in the US there are numerous examples of substantial fines for legislative breaches. Then of course there is software licence auditing (Figure 2 above).
The Gartner ITAM 2011 survey (Figure 3 below) found that more than 40% of respondents already actively use ITAM to support financial activities of their organisation, from budgeting and compliance audits through to sourcing options analysis and driving operational efficiency. But ITAM has a further reach into finance as it is part of the financial lifecycle of the organisation and can minimise risk exposure, these should all help you to gain the support of your CFO.
The Gartner 2012 ITAM Summit is in London at the Westminster Park Plaza on the 10th and 11th October.