The Three Priorities CIOs Use In Justifying IT Costs

An evening visit of familiar ghosts teaches the C-Suite a better way to filter budget decisions and cost justification.

The CEO, COO, CFO and CIO gathered in the morning. Only the CIO looked refreshed. 

“Rough night?” she asked. 

“You could say that,” the CEO said.

“Do you remember The Christmas Carol?” the CEO continued.

The COO and CFO perked up. The CIO responded, “Of course. And frankly, you look like you’ve seen a ghost.”

“I did,” the CEO said. 

“This doesn’t leave this room. I was sitting in my chair, by the fireplace, reading. My family had gone to bed. All of a sudden, the fire went out. The reading light flickered and dimmed. I saw a faint figure in the corner of the room. I thought I was seeing things. Then it spoke.”

“What did it say?” the COO chimed in, leaning forward.

“Nothing. He grabbed my hand. I don’t know if I was in a trance or traveling through time, but he walked me down a street. It was called The Road of Decisions. Lining the street on either side were places where I had made decisions. Some of those places glowed in gold. Those were the great ones, you know? Where the payoff was great.”

“Other places looked drab, worn down, with rotting wood and weak foundations, tattered shades and rusty pipes. Dilapidated comes to mind. Some of those were decisions I thought were great at the time; a couple were decisions I knew weren’t the best, but I convinced people they were.”

“In the places that glowed, people had gathered, drinking, laughing, and sharing stories. I smiled at that. But in the dilapidated places, bodies littered the yards. It wasn’t that they were dead, but something in them had died. It frightened me.”

“At the end of The Road, the Ghost spoke, a firm but warm tone filled his voice. He said, ‘Your decisions define you. But they also defend others.

“You fear missing out. You desire growth. Opportunity drives you.”

“Isn’t that what CEOs do?” I asked the ghost. “Seize the day?”

“No. CEOs weigh the risk. At least as first priority. It’s not a matter of whether you can lead people somewhere, but can you lead them safely. You must lead without loss. Opportunity is secondary to risk. Be safe, and then decide to be still or be strong in pursuit when it comes to opportunities.”

“Then I woke up, or came out of the trance or whatever that was,” the CEO said to his team. 

“I didn’t sleep a wink after that. Instead, I thought about it and realized the ghost was right. I can’t seize the day before I weigh the risk. I have to know how safe we are in doing something or not doing something. Success is not success if it can be taken from us. And today feels like security is a higher priority than I have imagined. I have to keep us safe. People are depending on that.”

The COO

“I have a confession. A ghost came to me last night as well. Funny thing is, I remember the story, the Christmas Carol, and I wondered which ghost this might be. I didn’t have to wait to find out.”

“He was dressed in an outlandish costume, an array of colors, layered garments, the works. When he grabbed my hand, he took me into our company’s auditorium. Everyone who works for us was there, seated, talking before the session began. I could see them, but I could tell they couldn’t see me.”

“I know what this is,” I said to the ghost. “But why are we here?”

“Then he asked me a question I didn’t expect.”

“What do you think of my outfit?”

“I paused. I knew there was no way out of telling him what I thought.”

“I said, ‘The colors clash, the layers are unnecessary, and it’s as if you can’t seem to make up your mind - you have a ball cap and clown shoes.’”

“Does it offend you?”

“Um. It’s inefficient.”

“And that’s important to you?”

“Yes. Quality and efficiency are important. Like they hear me say all the time, ‘Do it right and do it well.’”

“And how are these people doing?”

“Mostly fabulous. It’s why we are so well-reviewed. Usual room for improvement and such, but overall, I am pleased.”

“Those two are important to you: quality and positive review?”

“Of course. What else is there?”

“Resources.”

“What do you mean?”

“Look again.”

“I did. Everyone in the assembly began to radiate. It’s as if they became a form of themselves that was more, well, full. It was the craziest thing. Like they expanded, but not in body, if you can see what I’m saying. Everyone loomed larger without becoming a giant.”

The ghost said to me, “You make decisions based on how well something maximizes your capacity. You don’t make decisions on how something will expand capacity, especially the capacity within people. So much is possible if the resource is right, not just the process.”

“Then I woke up. I sat there for a bit. I do focus on the process, and I have to. You all count on me for that. But I don’t focus enough on expanding our capacity. I have to get the resources right. I have to stop holding people back and identify what is holding people back.”

The CFO

All eyes turned toward the CFO. 

“Yes, I had a visit. Fitting, since Scrooge was the money man.”

“And.”

“You can guess. I took a little trip into the future. No, it wasn’t horrifying. Tiny Tim wasn’t dead or anything. But what I saw shook me to the core.”

“What did you see?”

“Nothing. That is, nothing that had changed. Status quo, of all the godforsaken things.”

“I paled as if I was reading my own tombstone. I turned and said, ‘What is this ghost?’”

“It is as you see. Nothing. You do such a good job of managing revenue. You do such a poor job of leading return on investments.”

“But I manage ROI all day long.”

“Which is different from investing yourself into all aspects of the business, and seeing how each element can align with the business objective. When was the last time you felt excited about an opportunity technology or marketing or production could make on the business? When did you last contend for them, not just against them?” 

“I thought about it. You know that I’m supportive of each of you. I’m not an antagonist, at least I don’t see myself that way. But she was right. I don’t know what I must know. I need to help you save and help you add revenue by leading toward return, not just by managing revenue. As CFO, I’m not just a decision maker, I’m a strategist.”

The CIO

“Any ghost for you?” the group asked.

“Not a ghost,” she replied. “A dream.”

“It wasn’t my best look. I felt rather like that man Marley in The Christmas Carol. My robe was tattered. I carried heavy chains. I was gray all over.”

“A light shone in the room. It illuminated three capsules, the stand up variety that are clear, like a display case. Each of you was in one.”

“I approached you,” she said, looking at the CEO. “You were confident looking, like Tom Cruise in Maverick. Across your chest was the word, Risk.”

“Then I looked at you,” she said to the COO. “You looked at peace. Across your chest was the word, Resource.”

“And then you,” she said to the CFO. “Your word was Return.”

“At that, the room blazed with full, bright light, my chains fell off, and I looked like Cinderella at the ball.”

“That’s when I realized that I have been treating each of you as a force to overcome rather than a partner to communicate with. Especially when it comes to my budget!” She smiled.

“I have failed to communicate in a language you would understand; but I see now that you had to shift your perspective so that you could actually hear me out.”

“With you, my CEO friend, I need to communicate my requests through the eyes of risk. Do my proposals keep us safe?”

“You, my COO colleague, need to hear how I am expanding your capacity, not just serving your efficiency.”

“And you, my CFO, need me to demonstrate strategic return and business alignment, not just costs or cuts.”

And that is how, one frightful evening, a band of leaders understood that cost justification is prioritized:

First by risk: Can we afford to not do this? 

Second by resources: Are we expanding capacity?

Third by return: How is this business aligned?

(Need to revisit how you justify costs? I won't ghost you. Let me visit you.