Sourav Das, CDIO at Essel Mining shares his thoughts on the evolving CIO-CFO relationship and how IT is no longer just a cost center
- Meet Sourav Das, a CDIO and CIO of Essel Mining & Industries Limited at Aditya Birla Group, who is currently heading the IT and Digital function.
- Sourav went on to do Chemical Engineering from IIT Kharagpur and in the year 2000 transitioned from core engineering to IT starting as a technical consultant for SAP and moving on into Project & Program Management, Service Delivery Management, Transition Management & finally into IT Leadership.
- Over the years, Sourav has developed his portfolio by working with organizations like Reliance and Haldia Petrochem and accelerated change through intelligent automation.
- As part of the Digital Transformation series powered by Dell Technologies, we spoke to him to understand the relationship between a CIO and CFO and how it is driving change in technology.
Can you introduce yourself? How did you get acquainted with this domain?
While in 9th grade I developed a passion for computer programming. The logical aspect of basic programming fascinated me a lot and I was determined to become a computer engineer!
Though I was not a topper, I scored excellent marks and got selected at IIT Kharagpur but in the chemical engineering branch instead of the computer science branch. It was a tough decision for me as it was a big deal to get into such a reputed institution like IIT. After a lot of deliberations, I decided to enroll in Chemical Engineering as the IIT brand appealed to me more. This was in 1997.
Following the course of 3 years, I established my own domain in petroleum and petrochem engineering. Over the years, I developed my portfolio by working with organizations like Reliance and Haldia Petrochem.
I was thoroughly satisfied with the core engineering job but I believed that IT-focused more on the logical aspects of it. Also around the same time, the Indian Software industry was booming and recruiting the most competent and dedicated employees. I knew it was time for me to make a transition.
In the year 2000, I decided to take the next step by transitioning from core engineering to IT and eventually joined PricewaterhouseCoopers as a technical consultant for SAP.
Later, I pursued an MBA from IIM Lucknow in Finance and Systems with a minor in Marketing.
Today, I am the Chief Digital Information Officer (CDIO) at Essel Mining & Industries Limited. With respect to the functions of my role, my expertise extended towards the IT function as well as the digital function simultaneously.
What does your role as a CIO entail?
Currently, I am operating as the CDIO or Chief Digital and Information Officer of Essel Mining & Industries Limited at Aditya Birla Group. My role as a CIO or CDIO entails these five functions:
- The need to support the business and differentiate its parts efficiently and systematically. The need to be ahead of competitors and propose ideas that separate us from the crowd.
- Make the life of our employees easier while still being productive
- Ensure that the business is suitably assisted by data and information, that focuses on the entire business intelligence and analytics aspect of it.
- Driving process efficiency through intelligent automation
- Relook and refine the business and leverage technology to ensure that it positively impacts the main business parameters like the top line, bottom line, and efficiency.
You have been the CIO since 2015. Has the CIO’s role also evolved over time?
Yes the role of a CIO has evolved significantly over time.
Approximately ten years ago, IT was perceived as an auxiliary function, and CIO’s were regarded as technology managers. However, today we are recognized as functional units of driving change and implementing technology from a ‘business perspective.
That does not mean we are not IT managers. Initially, the organization expects you to take care of the IT part, you first fix the main pillars of the IT, you build up the basic groundwork and as you progress then you try to bring in newer things and try to influence slightly more important aspects and eventually focus on the strategic things.
Do you feel that the CFO and the top management are receptive to your strategic ideas? Is it easy to share your ideas from a business perspective?
As you gradually put forth your perspective that CIO or CDIO is not just about technology instead it is about the business and that as a CIO you understand the positive impact on the business then the receptiveness comes about naturally.
Today IT is no longer looked at as a cost function both by the CFO and the overall leadership. They understand that it is like an investment and what happens if you don’t do that investment.
For instance, a Pharma company heavily invests in R & D. What happens if it suddenly stops investing? Similarly, if one stops investing in the digital aspect of a business, the entire organization will become redundant. Therefore, we need to invest in IT and digital functions to facilitate change in an organization.
We keep reading articles which say that Finance people are from Mars and IT from Venus. Do you think so?
Both are functional experts, who speak different languages and have different personalities.
I think IT people are more likely to be risk-takers and change agents.
As a CDO or CIO, I have to try 10 things where 9 things will fail but the one thing will succeed. And the one thing that succeeds will bring enough advantages for my organization.
So I am a risk taker but contrary to that we all know that the concept of accounting is to be conservative.
But the interesting fact is that both IT and finance look at the business from different perspectives and therefore here lies the synergy between IT and Finance.
To answer your questions about whether IT is from Venus and Finance from Mars, I don’t agree with this entirely.
Here is my reasoning. I know a lot of CIOs who have a finance background like a CA/ CPA qualification and they do a fantastic job because as finance people they have two great things - One is they have excellent attention to detail and secondly they have a very good understanding of the business through numerical analysis. So with these two things they know which technology to leverage for the business.
Also, they are very good at selecting the applications and the solution that will fit best for the business as they have a more unbiased view. A tech guy is inclined more towards technology but the finance guy watches over the whole business.
Since you’ve been a CIO for a long time, have you seen any significant changes in the CFOs of today with regard to embracing technology?
In terms of technology five years back, it seemed very revolutionary to leverage technology or that matter has a full-fledged IT team but now it is very common. Similarly, the business paradigm has undergone a lot of changes in terms of GST, invoicing, and e-banking.
CFOs are embracing technology to alleviate performance and efficiency. More and more CFOs are automating algorithms for solving complex business problems. They have become more tech-savvy and are keen on leveraging technology for improving their infrastructure and output.
The CFOs of today are absolutely more open to embracing technology and the reason for that, is they understand two things:
- Overall the ecosystem has become more technology-driven.
- And they understand that technology can create a great difference in their work. And they want to leverage it.
So whenever I speak to any of the CFOs they were very keen on understanding how the technology can help them.
According to you what is a CFOs most stressful task when interacting with a CIO?
The technology and other architecture part is the CIOs lookout and CFO might not be interested in this. Hence we should not stress him with lots of technical jargon. However, since he has all the numbers of the business we must tell him how we can support him in achieving those numbers. In short, we should try to make his life easier.
I think the most stressful part is when two people are speaking totally two different languages and obviously at times the language becomes too technical to understand. So the art of any conversation is to speak the other person’s language.
In simple words, while interacting with the CFO you have to understand what exactly he is looking for and how you can answer that well.
Are CFOs now more open to allocating funds for IT-related ideas?
The business world has changed in terms of digitalization Today, CFOs do not view IT as a cost factor. They have become more of an investment in recent times.
I believe in the next five years, I believe the discussion will be that - Okay Mr. IT and Digital, I will give you 10 crores of budget. How much benefit can you provide for my business with that amount?
A CDIO is not a P&L holder but he is going to become one.
The role of a CFO is to safeguard the revenue and make the most of everything. They have to take into consideration three factors:
- if it is an Ad hoc spending
- If it is without proper budgeting
If it is without any benchmarking
So as long as you’re following a process of proper budgeting and proper evaluation and you are convinced that this is going to positively impact the business then I think everyone will be on the same page and there won’t be any problems.
For instance, during the pandemic, we have seen a lot of budgets being cut worldwide. But when it came to our business we understood that there are a lot of investments that are needed to be done and our budgets for IT and Digital actually increased very significantly in fact it almost doubled and the finance team was very much part of the approval process.
What type of difficulties do you face when you propose a new IT-related Capex?
To be honest, I face no difficulty because we typically do the due diligence before taking a proposal forward.
If I put forward two bad proposals then they will undermine the efficiency of our proposals then next time they would think that I am bringing the proposals for the heck of it.
Also, a good level of communication is important. It should not be about “ I need this technology so give me money for it”. Our entire IT team owns a proposal from end to end. Starting from the ideation to the implementation and beyond–we need to ensure that the proposal gets the desired outcome.
How do you calculate the cost-benefit analysis of IT Capex? Do you find it difficult to explain your plans for the future?
As finance professionals have a term known as ROI (Return on Investment) we also do our piece of analysis and we fondly call it “ROTI” (return on technology investment) and if I were to put it in better terms it is BVI ( business value of IT ). In every project, we do the BVI.
We have a project management office where the BVI is done systematically. It is an extensive process where we do a comparison between the pre and the post.
So the point is that if I am investing INR 100 what will the company benefit from it. Will the company will benefit in terms of cost, revenues, efficiency and etc? Yes there are challenges at times as we struggle to quantify things making it difficult to explain!
What is your advice to all IT managers and CIOs when dealing with CFOs and the finance fraternity?
The CFOs and CIOs must have a common language of communication. Both have a lot to learn from each other and both can help each other.
The IT person can help the finance person in solving problems with the help of technology and vice versa.
The IT person can help the Finance person in easing their lives because technology can do wonders as in the coming years business will be run by not just human brains but also artificial intelligence.
Communication and cooperation are very important for determining the results of an organization.