IT Governance


IT Governance is one of the foundations upon which a good enterprise architecture is built. There's no point trying to build interoperability for systems in a IT environment where you can't even make good decisions about projects and policy. This month's CIO magazine has a good article on IT Governance called "Deciding Factors". The article makes the counterintuitive point that strong IT governance leads to resourcefulness. Most of the time we think of governance as something constrains and indeed, that's the case in the points made by this article. The enterprise is constraining certain activities so that the overall organization can be more resourceful. Here are the eight key practices listed in the article:

  1. Scrutinize For Value - treat each IT project like an investment.
  2. Require Formal Project Requests - formal written IT project requests are a staple of good governance.
  3. Reuse Whenever Possible - reuse of hardware and software will be a standard part of a good IT shop's standard operating procedure.
  4. Mandate Speed With Short Deadlines - mandating short deadlines builds a culture of speed.
  5. Adjust Budgets To Reflect Benefits - remove the claimed savings from the requester's budget.
  6. Manage Projects As A Portfolio - never review one project at a time. Review them in groups with a scorecard approach to ensure they compete.
  7. Close The Loop With Postmortem Audits - check to see whether projects produced the expected value and learn from your mistakes.
  8. Avoid Draconian Measures - keep bureaucracy to a minimum.

Number five was interesting to me. The utah legislature approved a program to improve IT infrastructure and gave the money to the CIO's office in 2001. The money had to be spent on projects that had an ROI. The departments had to give some percentage (not even the whole amount) back to the fund to be used by future projects. The idea was that we'd fund continuing improvement out of the savings. We couldn't get anyone to take the money because no one wanted to commit to the savings. Eventually the legislature took the fund away when the budget crunch hit because it wasn't being used.

If you think about these points and read through the CIO article, one of the things you'll see is that IT governance, like all governance, concerns restricting individual unit freedom for the good of the whole. Project planning assumes that there will be projects that get funded and projects that don't. This can be especially hard in the public sector where agencies have considerable autonomy and guard it jealously. Layer on top of that a legislative system that's set up to fund each department as a separate line item and you can see the how problematic portfolio-based project management can be in a government setting.

While the article is mostly about making project decisions, but there are other aspects to governance that are equally important. An equally important governance area is policy, both that internal to the IT shop and that which affects the rest of the enterprise.