Technology CFOs Sound Optimistic About Economy, Hiring
Financial execs who work at technology companies are saying they feel a tad more positive about hiring and the economy in general. But don't expect much of a raise in 2010. Despite all that positivity, the bean counters are still working with tightened fiscal belts.Accounting firm Grant Thornton recently surveyed 496 chief financial officers on a number of economic and business topics. Of the nearly 500 financial executives, 53 of them worked for technology companies. Tech CFOs were more positive across the board. The 53 in that group were feeling pretty decent about their budgets and hiring, but don't expect much of a raise or bonus in 2010. Only 11 percent of respondents said they plan to give raises this year, with 32 percent actually decreasing them this year.
In terms of hiring, 37 percent said they expect to increase headcount in the next six months, compared with 29 percent in all other industries. Only 2 percent of tech CFOs said they expect to lay off employees, compared with 9 percent in every other industry. Over 80 percent of tech CFOs are keeping headcounts flat. From the report:
"Fifty percent thought that the U.S. economy would improve over the next six months (versus 44% for their counterparts in other industries), 60% thought their own company's financial prospects would improve (versus 52%), and 37% thought the economy would come out of recession in 2010 (versus 28%). In terms of inflationary pressure, only 17% were planning to raise prices in the next six months, versus 24% for other industries."Almost half of surveyed "national" CFOs said they believe the economy will not come out of the recession until 2011, and a quarter predicted that the recession will last longer than 2011. Only 15 percent of tech CFOs surveyed said they think the recession will be over after 2011. Forty-seven percent said they think it will end in 2011, one-quarter expect it to end in the second half of 2010 and about 10 percent said they think the recession is already over.
One reason to listen to these CFO numbers closely is that most senior managers in technology are reporting in to CFOs these days. A recent eWEEK article on organizational hierarchy issues pointed out that most CIOs responsible for IT management report to CFOs, and if not, many CFOs want it that way.
Why the CFO power grab? It appears the "one throat to choke" philosophy generally reserved for vendor management is in play with senior-level financial managers lately.
"CFOs now spend more time on strategy and operating issues and less on budgeting and accounting," wrote Chris Butler and Karen Quint, financial executive experts at Spencer Stuart, in an article on the increased responsibilities of the CFO. "CFOs help clarify business models, draw the maps of activities and provide a deeper sense of how a business actually works, its risks and opportunities ... CFOs are now risk managers, not just risk controllers. Risk management has emerged in the past year as one of the critical board-level issues."