UPDATED 14:07 EDT / AUGUST 04 2011

Keep Budget Discussions at Lowest Business Level Amidst Debt Crisis

CIOs should keep their language at “the lowest possible business level” when discussing their budgets with CFOs and CEOs, writes financial commentator Gerald Hallaren in a piece on Wikibon.org titled IT and the economy: How to shine in a tough environment, the first in a series.

Hallaren warns that the present sputtering economy will probably continue into mid-2013, driven in part by the conflict between Republican and Democratic economic policy in Congress but equally by the conflict between fiscal policy, set by the Congress and President, and monetary policy, created by the Federal Reserve Bank. While the economy will remain volatile, therefore, he predicts that IT budgets will be fairly stable but flat through the period. However, purchasing authorizations are likely to follow the economic ups and downs.

Hallaren says that in this environment, with C-level executives seeing every bit of information to help them try to predict what will happen next, CIOs should be careful to keep their budget discussions on a basic business level, and keep those comments short and on-point. Rambling discussions and equivocal statements will leave CIOs vulnerable.

CIOs should avoid broad, long-range statements as much as possible, he says. Any statement of IT objectives should be couched in terms of how IT supports the corporate mission statement. Strategic statements should be short and focused on how IT initiatives support the enterprise strategy. And avoid making any economic forecasts unless pressed, and then keep comments short and general.

CIOs also should expand the audience for their budgetary messages beyond the CEO and CFO. This is and will continue to be a period of turn-over at the top of corporate structures, Hallaren says, and while having a clear meeting of the minds with the CEO and CFO are important, the CIO has to be prepared for the possibility that one or both of those top executives may be replaced, possibly by other C-level executives inside the enterprise. In such cases, the CIO who already has a communications channel with the incoming CEO or CFO has an advantage.


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