Corporate odd couple can drive operational success: the old cliches about the bean-counter versus the gadget guru are hard to shake. Yet, today's CFOs and CIOs can find common ground for productive collaboration by embracing technologies like performance management.

For many business executives, it's a conventional boardroom image. The CIO pleads his case for some over-acronymed technology that promises to transform ... well, transform something. And the pinstriped CFO, with green eyeshades and money clip, pores over spreadsheets while slowly shaking his or her head in disapproval. They never seem to agree on anything meaningful.

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Is the cliche really true? Are today's CFO and the CIO a little too much like Oscar Madison and Felix Unger--Neil Simon's legendary "Odd Couple?" For forward-thinking enterprises, the corporate variation on those stereotypical images--the expense-obsessed bean counter and the gadget-evangelizing guy with the pocket-protector--are about as relevant as an old floppy diskette of VisiCalc.

The good news is that more than ever before, information technology (IT) and finance are ideally suited to cooperate and collaborate. In the Internet bubble years, there may have been an understandable tendency on the part of some organizations to implement "tech for tech's sake." The bursting of that bubble has led to a more sober assessment of what technology is actually needed to drive business goals.

IT is no longer the black box; today's generation of financial professionals--indeed, the vast majority of all enterprise employees--are far more comfortable with, even fluent in, a wide range of technologies. That's fostered a greater transparency and trust between IT and virtually all areas of the business. There's a greater appreciation of the IT discipline and, of course, far greater expectations as well.

Viewed properly, IT is not simply a utility service--it's a strategic resource. The question becomes: what's the best way to leverage the strategic business opportunities that effective IT/finance collaboration can provide?

Performance Management: Forum for Finance/IT Collaboration

Today, finance and IT increasingly share common goals and a unified vision--for both pragmatic and strategic reasons. From a pragmatic perspective, the CIO and CFO are virtually joined at the hip, thanks to an increasingly strict environment for corporate governance that has led to new levels of collaboration to ensure documented compliance with explicit regulatory frameworks.

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But, from the more important strategic perspective, finance and IT face an unprecedented opportunity to work together to drive their business forward in bold and innovative ways by embracing performance management as an enterprise-wide discipline.

Until recently, performance management has largely been viewed merely as a compartmentalized function for most organizations. The notion of understanding and monitoring current performance while planning future business strategies seemed like a noble goal. But it has fallen short because of an absence of a true partnership between two historically unlikely partners, finance and IT.

However, thanks to the "shotgun marriage" arising from Sarbanes-Oxley Act compliance and other regulatory requirements, finance and IT are setting aside their historical differences and embracing their complementary skills and strengths--all to improve the quality of financial data and integrate it with operational data. This ensures that both parties appropriately align with one another and use that information to plan for future risk through better financial and operational forecasting. In short, they're pledging to get the right information to the right people at the right time.

Four Breakthroughs that Enhance The Finance/IT Relationship

Performance management is best described as a continuum that begins with basic automation of specific business functions and evolves over time into a transformation of the broader business. The key is to achieve early gains--and, to be honest, those typically happen in the finance area--and spread those across the organization.

That requires a unique relationship between finance and IT, with progressive organizations embracing the business value of information. Let's look at the breakthrough phases that characterize how this collaboration can create effective performance management.

1 Eliminate the Baggage to Resolve Pains for Immediate Gain. In almost any financial organization, there are pockets of frustration--areas where numbers never quite seem to align or reconcile, where mysterious spreadsheets and plugged numbers are needed to keep things on track. They're often historical artifacts that roll forward because, well, they work for now. These areas are ideal starting points for performance management--opportunities to resolve chronic pain points and achieve immediate gains.

Spreadsheets in particular, while valuable for personal productivity, were not designed for and cannot cope with critical business processes on an enterprise scale. Spreadsheets are inherently disconnected. They create a host of obstacles for any finance organization trying to reduce process cycle times, increase the reliability of forecasts, dedicate staff time to added-value analysis instead of data collection or simply get a better idea of what is happening within the organization.

Not surprisingly, of course, financial people are often deeply reluctant to let go of those spreadsheets that, for all their drawbacks, have served their limited purposes. When IT and finance find common ground, there's a greater likelihood to let go of the old ways and embrace new technologies to automate some of the fundamentals. For example, performance management can create new ways for teams in finance to create and distribute plans, budgets and forecasts faster, with less effort, while engaging more contributors.

Performance management can break through the single-user spreadsheets and silos. It can reduce the close, consolidate and report cycle and provide the transparency needed for sustained compliance. It eliminates the disconnected pockets of data.

With dramatically fewer versioning and control errors, which are so common to spreadsheets, you increase the reliability of information on actuals and forecasts. You deliver critical financial reports faster, with less manual input. You save time and cost, and drive greater accountability.

2 Open to Change. So, you've automated some key fundamental processes. Why is that a noteworthy milestone? Well, once you have those basic processes automated, you're in a better position to drive best practices. Your people are freer to spend time on activities that truly add business value--provided you're open to the sometimes painful benefits of change.

If you're willing to adapt and adopt, you can implement a series of optimized practices. Consider the benefits of:

* Driver-based planning and rolling forecasts--revised as frequently as needed and involving all the right participants--to respond to changing business conditions with speed and flexibility.

* Altering plans and adapting forecasts that link to business drivers.

* Providing self-service access to key performance metrics for reporting and analysis.

* Standardizing universal processes and controls.

* Continually aligning investments with market opportunities.

* Integrating documented financial controls with the consolidation process to simplify compliance.

* Improving decision-support information for a more reliable and timely understanding of actual performance.

The overarching benefit from tactical automation is the liberating opportunity to focus on strategic gains. But that only happens to those bold enough to reexamine their processes and embrace new tech niques to optimize them.

3 Expand Your Horizons. Here's where the IT/finance collaboration really kicks in for the entire enterprise. By acting as role models for the organization, you're in a far stronger position to share those benefits with other departments, units and divisions to take performance management across the corporation.

Replicating the IT/finance partnership enables you to achieve best practices in planning and performance management throughout the organization and close the loop between operational planning and financial results.

Think about how you can radiate beyond finance and IT to:

* Develop and deploy modular plans that link market events to operational drivers.

* Capture sales projections--close to the customer--and use them to revise revenue plans that update P & L projections.

* Revise marketing promotion schedules to support updated sales projections.

* Adjust call-center staffing plans based on changing sales forecasts.

* Capture capital spending linked to balance sheet and cash flow projections.

* Reallocate resources quickly and intelligently based on changing market conditions.

* Spread the footprint of corporate and management reporting beyond finance to deliver financial results and metrics enterprise-wide.

4 Make the Connection--Planning and Operations. The ultimate goal of performance management is to coordinate and align your plans, activities and resources. That enables you to forge reliable and continuous connections between corporate strategy, financial management and operational execution.

For example, scorecards and dashboards can link your strategic objectives, initiatives and key performance indicators in a continuous cycle of planning, execution and optimization. You can gather information from front-line managers to identify opportunities and align resource allocations with corporate objectives and strategies. Performance management also helps you identify critical performance gaps with enough lead time to assess alternatives and respond appropriately. You make the connections that you were previously unable to see.

Throughout the organization, from top to bottom and across functions and divisions, effective performance management enables people to stay up to date, with timely insights into past, present and future operating performance. You are better able to focus on the value-driving activities necessary to achieve your corporate strategy, and people at all levels can see how their contributions support that strategy. The result is more effective, more consistent execution.

Today, the disciplines of finance and IT have matured. Where IT was once viewed as a necessary evil--an expense to endure--forward-looking enterprises are learning that, with an effective collaboration between finance and IT, those dollars become strategic investments. Performance management is the ideal paradigm to frame up those investments.

To make performance management a reality, IT and finance must go well beyond water cooler chat to create meaning and a singular data set out of disparate financial and operational data. That moves the relationship from "odd couple" to "ideal match."

TOM MANLEY is Senior Vice President, Finance & Administration and CFO for Cognos (www.cognos.com), a Toronto-based supplier of business performance management software. CLAUDIO SILVESTRI is Cognos' Chief Information Officer, responsible for leadership of Cognos worldwide information systems and infrastructure. (Editor's note: IBM Corp. announced in mid-November that it would acquire Cognos for $5 billion. Following completion of the acquisition, IBM intends to integrate Cognos as a group within IBM's Information Management Software division, focused on Business Intelligence and Performance Management.)

RELATED ARTICLE

A CFO's Advice for CIOs

Be engaged in the business every day Don't work in isolation from the management team Understand the value the organization provides to customers

Understand the strategic priorities of the business

A CIO's Advice for CFOs

Be progressive--view IT as a strategic investment, not a cost

Respect the value of IT to enhance business collaboration

Work with the CIO to implement performance systems that eliminate surprises and improve visibility

Continuously challenge the business and avoid complacency

RELATED ARTICLE: TAKE AWAYS

** The popular image has CFOs and ClOs as polar opposites--an odd couple featuring an obsessed bean counter and a technology-evangelizing guy who talks in acronyms.

** Today, however, the CIO and CFO are virtually joined at the hip, thanks to an increasingly strict environment for corporate governance that has led to new levels of collaboration to ensure documented compliance.

** By embracing performance management, both parties can appropriately align with one another and use the resulting information to plan for future risk through better financial and operational forecasting.

** BPM allows companies to better focus on the value-driving activities necessary to achieve corporate strategy, and people at all levels can see how their contributions support that strategy.

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