1/16/2012

Numbers? Information Technology: Strategy and Governance

2002 - Gartner - 20 percent of all expenditures on IT is wasted - an annual destruction of US $600 billion 2004 - IBM - Fortune 1000 CIOs - 40 percent of all IT spending brought no return 2006 - The Standish Group - 35 percent of all IT projects succeeded - remaining were either challenged or failed

Tell me why?
Aware and Demanding Expectations Panacea? Potential Performance Pressures Pace
DEPENDENCY

More tell me why?

Understanding Planning Implementation

ITS IT for OE ITBI

Managing the Technology Envt.

Governance

IT Governance Some ideas

The process by which decisions are made in IT investments.
2005 Forrester Research, Inc.

IT Governance
Lack of IT governance results in
Ambiguity regarding roles, responsibilities and accountability Mismatched priorities between IT and Business Elevated IT risk Siloed and shadow IT Poor IT investment prioritization & execution

The framework for decision rights and accountabilities to encourage desirable behavior in the use of IT
2005 Weill & Ross, MIT Sloan CISR.

Structure of relationships and processes to direct and control the IT to achieve ITs goals by adding value while balancing risk versus return over IT and its processes.
IT Governance Institute.

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What?
Business IT Alignment IT-related decisions Structures and Mechanisms CIO IT and the Board Value conversion contingencies

Why is alignment important?

Strategy Complexity Information is the glue Coordination Dematerialization Adaptive Processes Data to Business Insights

Why an issue?
Speak different languages Moving separately together Why bother about business?
Keep pace

Technology is difficult !
Bean counters Intangible and invisible

Picture adapted from: Adventures of an IT Leader, Austin, Nolan and ODonnell

IT related decisions

What?
Business IT Alignment IT-related decisions Structures and Mechanisms CIO IT and the Board Value conversion contingencies
IT Principles decisions IT Architecture Decisions Business Application Needs IT Infrastructure Decisions IT Investment and Prioritization Decisions

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Who makes these decisions? Inputs to these decisions? Responsibilities?

What?
Business IT Alignment IT-related decisions Structures and Mechanisms CIO IT and the Board Value conversion contingencies

Organizational Structures Alignment Processes Communication Approaches

Role of the Board Why is it important?

50% of capital spending information assets in II organizations Operational dependence on IT Failure cases increase in number and intensity I dont know much about IT vs. I dont know much about accounting

What?
Business IT Alignment IT-related decisions Structures and Mechanisms CIO IT and the Board Value conversion contingencies

Potential Value

Realized Value

Conversion Contingencies

Impact