What is required for effective IT Governance?

A top priority for most IT organization's today includes the implementation of processes that enable the measurement and management of the business value of IT. To facilitate this, many are looking to IT Governance decision-making frameworks and processes that define how all IT investments decisions will be made, where accountability lies for those decisions and the ongoing management of investments and technology standards.

IT Governance is defined as the leadership and organizational structures and processes that ensure that the organization's IT investments sustain and extend business strategies and objectives. Research illustrates the importance of having IT governance frameworks in place. Peter Weill , Director, Center for Information Systems Research (CISR) & MIT Sloan Senior Research Scientist, studied the IT Governance of over 250 organizations and determined that those with effective governance structures in place earned higher profits by greater than 20% over organizations with less mature frameworks in place.

However, effective IT governance requires that IT have a number of key elements in place:

Clear understanding of the business strategy of the corporation

For governance initiatives to deliver on their promise you must be able to relate decisions and expenditures to corporate valve. Value is driven by applying IT to the business goals of the corporation

Defined IT organizational decision making structures

Both an understanding and acceptance of the current structure of IT decision making or a roadmap and change management plan for moving to a new model. The structure of IT will influence the decision making process and "stage gates" required to make process consistent and measurable.

Decision making and performance management standards

Effective governance requires an "across the board" application of standards for decision making on where IT investments will be made. A consistent criterion for measuring things like business value combined with standards on who can make those decisions are critical.  Bringing a portfolio management discipline to projects, applications and infrastructure investments is an effective way to achieve this.

IT business management systems that enable governance structures

Just as any modern business requires management systems, effective IT management requires systems that bring repeatability to process and visibility into the performance of the IT organization. Without the application of "IT Business Management" solutions governance efforts are running blind, or are supported by administratively intense processes of regular information gathering. The impact of business management systems for IT is twofold. They enable more efficient management of IT service delivery and as a byproduct, provide the information required to better govern IT.