Professional Documents
Culture Documents
The
term Governance has become prominent in all areas of business including IT. IT Governance
The assignment of decision rights and the accountability
Governance
Governance is about deciding who makes decisions whereas Management is about making decisions once decision rights
Numerous
business scandals (U.S. Enron, Global Crossing etc.; Australia HIH) have prompted the increased interest in this area
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Governance
has become more important in the IS world because IT expenditures have become so large and diverse that management has had to find a way to bring order to all the decision making Centralizing all IT decisions is not a solution
All business units and local employees need a
voice in the decisions to tailor their business to the local culture and customers Striking such a balance is a major IS emphasis
Assigning
Decision Rights
Six governance styles (the rows) 1.A business monarchy is where C-level executives (CIO..) hold the right to make decisions 2.IT monarchy = where IT executives hold the right to make decisions 3.Feudal is where business unit leaders (or delegates) have decision or input rights 4.Federal means that the rights are shared by C-level executives and one other tier of the business hierarchy 5.A duopoly is where one IT group and one business group share a right 6.Anarchy is where individual process owners or end users hold a right
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Assigning
Decision Rights
Five decision areas (the columns) 1.IT principles are high-level statements about how IT will be used to create business value 2.IT infrastructure strategies state the approach for building shared and standard IT services across the enterprise 3.IT architecture states the technical choices that will meet business needs 4.Business application needs is where the business defines its application needs 5.IT investment and prioritisation defines the process for moving IT-based investments through justification, approval and accountability
IT
attention
Business
Shaping the IT Portfolio A Strategic View of Making IT Investments Intense competition in non-regulated industries forced executives in these to innovate
By investing in IT By improving their business processes, and By offering new products and services
These
Sequencing
generally sequenced their IT investments so that new ones built on existing ones Timing is also important
Rush in only when it advances company goals, builds on strengths and cannot be easily replicated by competitors Everybody is doing it = not a good reason
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Complementing
IT investments
accompanying management practices change to take advantage of potentially better ways of working
NOTE: IT is not the only contributor to increased
productivity
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attention has been placed on shaping the IT portfolio as business executives seek to maximize the business value of their IT investments Most companies have far more opportunities than they can fund
Must find a way to prioritize the possibilities to best
Benefits
moderated, the participants better understand the business goals, better support others and other business units and are more committed Leads to:
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Put
E.g. R&D projects cant generate immediate tangible benefits Have a minimum $ - projects below this should be funded from discretionary budget
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Address
Project Risks
Need mitigation strategies and include cost thereof in the project cost
2.Risk of not doing the project
achieved
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Prioritize
long time Track projects and if significant deviations = consider project costs, risks and benefits
Be
Consistent
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CIOs
are in the change business Information systems bring about change BUT before a CIO and the IS organization will be heard as a voice for change, the must be viewed as being successful and reliable To foster change, a CIO must establish and then maintain the credibility of the IS organization
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The
today includes:
Computer operations
oriented with a high level of service Some = outsource parts Once you have today working well they will listen to you reg tomorrow
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Techies
into implementation failures because the people side of the system was not handled correctly
IT
New systems require changing how work is done Focusing on the technical aspects is only half the job.
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People
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Working
side = fewer suppliers but deeper relationships Customer side = need buy-in to building / using inter-business systems
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Some
believe the office of the CIO is so broad it should be handled by a team Four positions:
1.Chief Information Officer Heads IS and works with top management, customers and suppliers 2.Chief Technology Officer Heads IT planning, which involves architecture and exploration of new technologies 3.Chief Operations Officer Heads day-to-day IS operations 4.Chief Project Officer Oversees all projects and project managers
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IT
is so critical to enterprise success and the know-how needed to run it so deep and wide = management needs to become a team effort
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Different
periods of recent history have seen executives with different backgrounds running the show
Manufacturing = in the early 1900s Sales and Marketing 30s to 50s
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IT
decision making must be shared - The main responsibility for managing the use of IT needs to pass to the line, while the management of the IT infrastructure is retained by the IS group It is reflected in the following saying:
We used to do it to them- IS required end users to obey
strict rules for getting changes made to systems, submitting job requests, etc. Next, we did it for them-IS moved to taking a service orientation Now, we do it with them- which reflects partnering We are moving toward teaching them how to do it themselves
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To
achieve this transformation, CIOs must play a leadership role in their enterprise and develop partnerships with senior management, internal and external customers, and suppliers
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