A CFO's leadership style influences his or her decisionsabout technology investments, according to a study by EpicorSoftware. The study's data suggest that smart decisions abouttechnology also support a company's profitability.

Epicor surveyed more than 1,500 CFOs of manufacturing,distribution, and retail companies—the industries for which itprovides ERP systems. Based on their replies, it divided CFOs intosix different leadership types: Carers, Conductors, Politicians,Revolutionaries, Traditionalists, and Visionaries.

Traditionalists are the CFOs who are least likely to see theneed to invest more in the company's technology systems. Only 14%of Traditionalists in the survey said their systems should beupdated, versus 32% of CFOs overall.

“They haven't made that link between how an investment in newtechnology might enable their company growth to accelerate,” saidMalcolm Fox, vice president of marketing at Austin, Texas-basedEpicor.

According to the survey, that is having an effect on theircompanies' bottom line: Just 56% of companies whose CFOs areTraditionalists experienced profit growth, versus 64% of thecompanies overall. Nine percent of the executives surveyed fallinto this category.

At the other end of the spectrum, Revolutionaries are open tochange and more demanding when it comes to their company's businesssystems. For example, 48% of Revolutionaries regard their company'sIT support as insufficient, versus 36% of the CFOs overall.

Revolutionaries “are not happy with the way things are, and lookto new tools and techniques to help them go about making thechanges that are needed,” Fox said. “They're not satisfied with thestatus quo, and they believe technology has a role to play inhelping them grow.”

That seems to be paying off for them: 72% of the companies whoseCFOs are Revolutionaries registered profit growth, versus 64% ofcompanies overall.

According to the survey, Politicians, who comprise more than aquarter (27%) of the CFOs surveyed, are more cautious and have afocus on consulting with others and working collaboratively.Conductors, who make up 16% of the executives surveyed, are morelikely to make decisions based on gut feelings rather than data,while Carers, at 19%, are concerned about the quality of the dataon which they're basing decisions.

Visionaries, at 9%, are open to change, including changingtechnology: 41% say their company's systems need updating, versus32% of CFOs overall.

Greater Role for CFOs

As technology becomes more central for businesses, CFOs havetaken a greater role in technology decisions. A series of surveysby Financial Executives International (FEI) and technologyconsultancy Gartner found that the proportion of companies whereCFOs make the decisions on technology investments rose from 24% in2012 to 29% in 2014, while the proportion of companies where CFOsand CIOs decide jointly fell from 24% in 2012 to 12% in 2014. As of2014, CEOs decided on technology investments at 23% of companies,CIOs at 5%, and committees of IT and business executives at16%.

Fox, at left, said CFOs have alwaysplayed a role in technology decisions, but they have often havelooked at those decisions “from a very narrow perspective, thinkingabout this as a spend.

“What we're looking at here is the need for them to look beyondthe numbers and think about this from a business perspective,” hesaid. “One of the things we're saying is: Think a bit more broadlyabout 'What is it going to do for the business? How is my businessgoing to be better because of this investment I'm making?'”

The link that shows up between CFOs' leadership styles, theirtechnology investments, and profit growth reflects both theflexibility and the data that technology can provide.

“Modern, agile business systems these days enable a business tochange and grow without holding it back,” Fox said. “In the bad olddays, a business system that wasn't flexible, that was only set upto do a certain thing, could hold a company back from growing.”

Modern business systems also support profitability by providingexecutives with the information they need, he said.

“CFOs are always interested in reliable and accurateinformation, and in the past that might have taken quite some timeto create,” Fox said. “Modern systems are very much more geared upto producing that information quickly and accurately to allow gooddecisions to be made.”