Finance and Technology for

More Effective Systems

A CFO Perspective
ICGFM Conference
May 21, 2009
Content
• Overview
• Key challenges
• Systems can help
• Managing IT System projects
• Summary
Overview
• Governments are making significant
investments using stimulus packages.
• Scepticism on effectiveness:
– “What did you get for it?”
– “How will you know if there is fraud?”
– “Government procurement is not flexible
enough.”
– “How will you get the money spent in order
to make a difference this year?”
Key challenges
To achieve success:
• Clear objectives need to be set
• Process with risks need to be identified
• Internal controls need to be established
and
• Reporting on progress will be essential
Need effective IT Systems
Processes with risk
• Budget bill to departmental accounts
• Project design/determination
• Procurement
• Vendor selection
• Environmental assessments
• Project initiation
• Project Implementation
• Monitoring and Reporting
Internal Controls & Reporting
• Related to every process.
• Risk tolerance level needs to be
understood.
• Timely and accurate information that is:
– Easy to access at any time
– Organized to report many different ways
IT Systems can help
• For Vendor selection:
– Financial assessment
– Report on performance on previous projects
and audit results
• For cash use:
– Spending trends
– Comparison to other projects
IT Systems can help
• For Results:
– Progress on stimulus procurement and
spending
– Progress against plan by project – financial
and non financial
• For Fraud/Waste:
– Statistical sampling
– Analytical models
New IT Systems needed
• Befriend the Chief Information
Officer (CIO).
• CFO and CIO are partners in
achieving organizational goals.
• CFO must understand what IT is
planning, spending and delivering.
• Standard IT principles apply.
Managing IT System projects -
Key principles for success
• Clients are accountable for the
effectiveness of their systems, not IT.
• Processes first, technology second.
• IT labour is the cost to watch – not
hardware & software costs.
• Funding limits are established.
• Costs need to be understood.
Key principles for success
(cont)
• IT Strategic Plan
• Investment Plan & Governance
• IT Costs Clear
• Common Approach to Managing Projects
Strategic Plan
• “How will IT support departmental
goals?”.
• Period of 3 to 5 years.
• Vision – “What will be different in year 3
or year 5”?.
• Clear performance measures.
• Demonstrate “What will it take to
achieve success?”.
Investment Plan &
Governance
• IT does not own most systems – it
operates them on behalf of the
organization.
• Investment Plan for all IT spending
managed by Investment Committee.
• New projects reviewed and approved by
committee.
Investment Plan &
Governance
• Investment Plan adjusted to add new
project – reprioritize other projects.
• Regular updates to Committee on
progress.
• Committee commitment and support is
paramount.
IT Costs Clear
• Organization’s cost - not the CIO’s cost.
• Consistent and agreed upon approach to
costing.
• Separate costs – project vs. on-going.
• Hidden costs exposed – example on-
boarding cost of new hires/consultants.
• Show costs or bill costs to clients.
Common Approach to
Managing Projects
• Standard governance, processes & tools.
• Includes hardware, software and custom
systems.
• Understand linkages to external systems
and initiatives.
• Implementation impact is considered –
costs, employee down time, training etc..
Common Approach to
Managing Projects (cont’d)
• Business case developed every time.
• On-going costs approved when project
approved.
• Sun-set dates are established.
• Asset management processes in place.
Summary
• Stimulus money implementation will be
challenging.
• Process risk, internal controls and
reporting need to be managed.
• IT systems will be important.
• Risk of implementing new systems
must also be managed.
Summary (cont’d)
• Impact on all IT plans to be assessed.
• Normal IT Management practices still
apply.
• Clients, Finance and IT understand
their roles and accountabilities.
• Just like the stimulus money - IT
spending must be clearly managed,
understood and explained to all.
Questions?