Terascala’s Rich Block: ‘Stovepipes’ Hinder Finance in Working with IT
In a CFOworld Q&A, the storage-products company CFO and Babson College professor says communicating may rival cost-cutting in importance.
Veteran financial officer Richard Block has embarked on a new adventure as CFO of Terascala, a Massachusetts-based, venture-funded manufacturer of high-performance parallel file system storage products.
Before taking the Terascala post, Block worked at an executive services firm as an interim financial executive for companies in transition; as CFO for a supply chain consulting and IT integration company; and as a senior financial manager for Intel and Digital. He shares his knowledge with future financial executives as a faculty member at Babson College’s Graduate School of Business. And he has a particular fascination for helping finance professionals and students alike get the most out of spreadsheets.
Sandra Gittlen recently spoke with Rich Block about his new position and the changes he’s seen over the years in the relationship between finance and IT.
As you ramp up Terascala’s finance department, how do you envision the bond between accounting and IT?
The connection between the two is extremely important, and must be symbiotic. Major compliance laws like Sarbanes-Oxley, HIPAA and PCI (for the Payment Card Industry) bring to light the additional responsibility both groups carry. For instance, there are requirements for testing and validation of security. The finance person has to translate those laws and ensure IT understands them -- even if IT doesn’t report to the CFO.
Do you think finance today is more or less in tune with IT?
Less. It used to be that the only person allowed to touch a computer was IT. Accounting teams would lay out a schematic or blueprint of what they wanted to do, and IT would write an application to produce that result. With the ev
olution of [off-the-shelf] software, it’s easier for finance teams to get their work done. But the downside of that is they don’t involve IT in things like storing data. Also, finance people just do their own thing and don’t always document their methods, vet them or review them. That makes it difficult for IT to ensure the tools are being used properly.
Do you think IT has contributed to this disconnect in some way?
I think organizations as a whole have developed stovepipes. Usually, a company has a large accounting system -- an ERP maybe -- that is generally used to run major aspects of the business. And it costs a lot. However, IT oftentimes doesn’t turn on all the modules available in order to save money. This forces finance to subscribe to other services to get that functionality. This can be problematic for IT because they don’t know how to integrate that data. As a finance person, I always try to make sure that people on both sides -- finance and IT -- understand that by turning on those modules and training finance teams on them, they are ensuring the data generated can be integrated and it stays in-house.
Why do you think this happens?
Not enough planning before these systems are deployed. ERP systems can be complicated to install so once they are in, it can be costly and complex to start adding on functionality. That’s why you have to find out ahead of time what everyone needs.
So you’re not a fan of software-as-a-service for finance?
