When Digital Reports to Finance: The Risk of Sidestepping Opportunity
When I joined the workforce in the 1990s, digital technology teams commonly reported into finance. It made perfect sense at the time—digital tech was emerging, treated as an unknown cost center, with no ERP systems, no affordable AI, and no coherent vision for joined-up data.
Today it seems we are going back to the 90s, we’re seeing a troubling resurgence of that same structural pattern—digital functions being subsumed under the CFO’s domain—across both public sector agencies and private enterprises, especially here in New Zealand. But to do so now, when digital is central to transforming how we deliver public services and run businesses, feels not just backward it borders on strategic negligence.
In contrast, Air New Zealand is taking this seriouesly. The airline has appointed its Chief Digital Officer, Nikhil Ravishankar, as its next CEO. That isn’t just a symbolic gesture—it’s a recognition that digital will drive transformation, resilience, and growth in today’s environment.
Productivity at Stake
Right now, both government and business are under immense pressure to deliver more with less. Every dollar spent must achieve maximum impact. And the greatest opportunities to unlock those gains lie in digital:
Automation of repetitive processes frees staff to focus on higher-value work.
Cloud adoption and platform consolidation can cut duplication and operating costs.
Data-driven decision making improves resource allocation and service design.
AI and advanced analytics open up whole new opportunities for smarter, faster, more responsive delivery.
None of these gains are realised if digital is viewed only through the lens of cost control.
Instead of enabling transformation, Finance tends to default to short-term savings, limiting investment just when investment is needed most. This is “penny wise, pound foolish” in action—cutting off long-term productivity gains for the sake of reducing immediate spend.
The Wrong Lens: Siloed, Risk-Averse, and Transactional
Finance leaders are brilliant at fiscal stewardship, but their operating model isn’t designed to foster innovation.
They work in silos, while digital transformation cuts horizontally across entire organisations.
They are trained to minimise risk, while innovation demands experimentation and agility.
They prize predictability, while digital thrives on iteration, flexibility, and investment.
The result? Strategic opportunities—whether cloud migration, modernising core systems, or deploying AI responsibly—get delayed or downsized, precisely when they are most needed to boost productivity.
An opportunity lost
Here in Aotearoa NZ there are rumours that the Government is both demoting digital functions down the food chain under finance, at the same time as giving the DIA more power - that is another topic altogether. This combo feels like a lost opportunity wrapped in cost savings rhetoric.
Don’t get me wrong, finance has a crucial role: stewarding resources, enabling ROI, and ensuring fiscal discipline. But when Finance owns digital, innovation is sidelined. Transformation becomes transactional. The organizations—government or private—that will thrive over the next decade are those where digital leadership is visionary, embedded in strategy, and empowered at the board level alongside finance—not controlled by it.
