“IT governance is the responsibility of executives and the board of directors, and consists of leadership, organizational structures, and processes that ensure that the enterprise’s IT sustains and extends the organization’s strategies and objectives.”– IT Governance Institute
How Do You Assure You are Leading through IT Decisions?
In today’s world, IT governance can mean many things and refer to various IT frameworks. In many cases, IT governance is confused with simply implementing standards to report results and compliance. Fundamentally, IT governance is about establishing a structure to align your IT Strategy with your business strategy.
IT Governance is defined as the decision rights and accountability for assuring good behavior in our use of IT. The IT Governance Framework can be applied to any institution and is typically for use by CIO’s and top IT Management. It is a framework of decision rights and oversight that is intended to drive maximum value out of all information technology investments, minimize risks, use resources effectively, and assure alignment with a company’s most important strategic business goals and objectives.
Why is IT Governance Important?
The importance of IT governance is that it achieves desired outcomes and behavior. The relationship between IT governance and effective value creation of IT investments has long been recognized and is often recognized as the reason for achieving excellence in the management of IT. It provides a focus on cost and allows effective communication between IT and the business by establishing joint accountability for IT investments. Governance offers a formula for success which allows leaders to be active in the strategic management of IT and to make sure the following basic elements are in place:
Governance works hand in hand with IT portfolio management to align IT investments with agency objective which enables managers to improve responsiveness to challenges and manage current and future IT investments. It provides transparency into IT investments and ensures corporate resources are utilized in support of the business goals.
- Decision Making
Governance allows leadership to actively commit to improving the management and control of IT activities and outcomes.
- Resource Balancing
Proper management of critical resources enables control in planning and organizing IT initiatives. This gives managers the ability to ensure adequate IT support is available for current and future IT investments.
- Risk Management
Proactive risk management ensures that IT managers and leaders are aware of the risks associated with the IT initiatives and provides the basis for the implementation of risk mitigation strategies.
- Execution and Enforcement
Governance provides IT managers with the framework to manage and prioritize IT initiatives and demands through a single point. It allows for the standardization of technology platforms and helps managers make informed decisions on IT initiatives.
Effective governance is about accountability. It enables IT managers to enforce the responsibilities that relate to IT program management.
What are the Challenges with Implementing IT Governance?
IT governance cannot exist in isolation and is a process by which IT decisions are made. Rolling up all IT investments and projects under the IT leadership provides a complete and comprehensive view of the IT portfolio. This enables leadership to make better strategic decisions and proactively manage and evaluate future investment as a group. IT portfolio management also provides the mechanism for effective IT governance and reporting.
Establishing IT governance is not a one-time implementation or achieved by a mandate; it requires commitment from executive leadership. It is an activity that requires continuous improvement. The challenges faced by CIOs are numerous and complex.
In my experience, the following reasons are the most common factors prohibiting the effective implementation of IT governance:
- Lack of implementation and adherence to good portfolio management practices and processes
- Undefined IT principles
- Decision authority not properly defined and/or delegated
- Poorly structured decision boards
- Lack of alignment of IT Strategy to Business Strategy
- Decisions are not monitored
- IT Policy not defined or adhered to
- Procurement of IT services, systems, and resources are not managed
IT governance spans the organization‘s policies and practices that provide for IT management. Effective implementation leads to effective communication, reliable data, clarity of accountability, and respected decision making.
It is not enough for corporations to have IT systems and expect them to deliver strategic value. IT governance is important and will ensure the effective and efficient use of IT to achieve the organizations business goals. Each company has unique needs, and the approach to governance will vary with the culture and structure of the organization. Implementing good IT governance requires a framework based on three major elements:
- Effective structure
- Effective process
- Effective communication
To achieve maturity ensures that IT is working as effectively as possible to maximize cost savings and to recognize the benefits of each IT investment. It also ensures that the investments are consistent with the organization’s business strategy.
I am here for you if you want to discuss your IT Governance needs and challenges. In the meantime, download our complimentary IT Governance Framework eBook to help you to regulate, monitor, and govern the value of your 2019 IT decisions. Check it out here…
Until next time, have an effective week! To further this week’s conversation, feel free to schedule time with me and let’s talk!
IT Executive Advisor and Leadership Coach
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