Firm technology requirements have changed and will continue to change. The definition of IT has expanded and impacts everyone in your firm. Its size and the amount of IT knowledge that your chief executive or managing partner has dictate the type of technology leader that your firm needs to be successful.Yes, you read correctly — the CEO or managing partner’s understanding of technology and commitment directly impact success. The buzzwords today are “integration” and “innovation.” IT leaders must understand the firm’s vision, and firm leaders must understand how technology innovations can accelerate the achievement of that vision. Integration is a two-way street.
According to a recent article, there are three types of chief information officers:
* The functionary, who keeps the IT house running, and doesn’t waste time or money.
* The transformation CIO, who leads change and redesigns business processes.
* The business strategist, who interacts with end users and develops IT-enabled business systems.
We find functionary and transformational IT leaders in most accounting firms. We also see a need for business strategists, but few exist within the accounting profession today. Each type of chief information officer has a place, and one is not better than the other — unless a firm needs a specific kind of leadership.
ONE SIZE DOES NOT FIT ALL
Many CIOs and other IT experts in accounting firms today were hired as functionary leaders. Their primary role is to make sure that systems stay reliable, and they stay within the budget established by firm management. (While this is exactly what some want, functional leaders typically prefer to be “hands on” and often fail to think about or seek out additional expertise.)
Some firms are in need of transformation, and only agents of change can get the job done. They require leaders who can deal with and overcome the silo mentality, as well as interact with both firm management and end users.
Business strategists are the IT leaders of the future. They have multiple skills and are particularly adept at communication. They develop systems, rather than implement applications, and interact with internal and external peers to support the firm’s vision. (They are more externally focused from a client’s perspective.) This is not the type of leader that your firm needs if its systems are unreliable, but if it is growing and intends to stay competitive, this is exactly who it needs.
TECH IS STRATEGY
The business climate has evolved significantly over the past five years, and has accelerated the urgency for strategic IT leadership. The old saying that those with the strongest opinions generally have the least amount of understanding holds true for many firms. The firm’s executive committee or board too often charts a course for technology with little or no understanding of the subject. Among many other benefits, business strategists offer a safety net from poor investment decisions in technology.
All firm leaders should stay current with technology. No, you don’t have to know how to build the watch — but you do need to know how to tell time. Young managing partners and CEOs often have more IT knowledge than their older counterparts.
THE RIGHT RATIOS
In the corporate world, the average life of a CIO was four years and five months in 2007. Tenure was down by eight months from 2006. Like any other leader who rises to the top, CIOs need time to think, plan and grow. Firms should assess leadership requirements, hire and promote accordingly.
Another interesting statistic is that the support ratio of finance workers is the highest of any industry, at 1:16. Our most recent survey shows a 1:31 ratio within the accounting profession. Remember, average is where the worst of the best meets the best of the worst.
Firms are often unreasonable in their expectations regarding support. Accountants deal with far more applications and systems than workers in most other industries. Standards, policies and procedures, along with time for training and learning, also impact the support ratio.
Here are some action steps you should take to ensure that your firm’s technology leader meets your requirements:
* 1. Conduct a technology review.
* 2. Evaluate your IT leaders.
* 3. Review and update job descriptions.
* 4. Compare your firm’s metrics to leaders within the profession, as well as companies outside of accounting.
* 5. Develop a strategy for IT leadership and governance.
The best get better through planning, people and processes. How is your firm doing?
Gary Boomer, CPA, is the president of Boomer Consulting, in Manhattan, Kan.
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