Governance takes effort, but when completed the two solitudes of IT and business will understand each other better

By Catherine Aczel Boivie

CIOs are increasingly being hit by studies on the importance of IT governance, and often those concerns are met with one thought: this is yet another task in their already busy professional lives. But that may not be the case: governance could actually assist CIOs by improving IT’s alignment with business and ensuring tech decision making is more transparent.

IT governance simply deals with who makes which decision. It sounds far more complex, but it isn’t. Governance questions include who decides how projects will be approved, if help desk hours will be extended or who is involved in the problem-escalation process.

Governance does not occur just in IT: it exists in other areas of the organization, including finance, where there is an investment policy, or in customer support, where service-level agreements must be administered. These are all forms of governance.

An example of informal but seemingly effective governance is the story about the couple celebrating their 50th wedding anniversary. When the reporter asked the secret of their long marriage, the wife replied: ‘That’s easy, he makes all the important decisions and I make all the unimportant ones.’ Okay, thought the reporter, and asked her to give examples of unimportant decisions. She replied: “I make the decisions such as which car to buy, where to go for vacation, whether it is time to buy a new house.” “What important decisions does your husband make,” the reporter asked? “He decides whether to increase Canada’s defense budget, who to sell the next nuclear reactor to, whether to increase the Bank of Canada interest rate.”

So there are different kinds of governance, both as formal and informal processes.

Getting started
But how to start setting up IT governance? First, don’t do it alone; get senior management’s understanding and buy-in to the process and form a group that has both business and IT representation. Next, with the group in place, it’s best to find an external person who has already completed this process to act as an advisor. Don’t make setting up governance arduous, as it can be done as a three-step iterative process.

First, the areas which require a formal decision-making process must be identified. This could range from how IT projects are prioritized to how IT will be used to create business value. The types of decisions that need to be formalized depend on the size and the culture of the company.

Second, after agreeing on which decision- making processes need to be formalized, spend some time documenting how these decisions are made now. Look at who is involved in each phase of decision making and, in step three, at what role he/she plays in the process. These roles vary from having input to making recommendations and all the way to approving decisions. Once this is completed, use this information to start a discussion at a system steering committee or within the senior management group on the process of how decisions are made now and how they should be made in the future. This will provide a framework for governance that will work for both business and IT.

Third, after arriving at a general agreement (on what decisions need to be formalized, who makes the decisions and what their role is), the CIO, with the help of others, can develop a plan and timetable for implementation. A major part of setting up new governance is getting buy-in for the new process. Throughout this, both formal and informal communication is very important. This can be done through networking with co-workers and/or providing periodic status reports and best practices.

In getting the new governance process defined, the business unit managers need to actively participate so they better understand some of the issues involved in making decisions that relate to technology issues. Setting up a new governance framework involves a lot of informal networking, building relationships and learning about business issues. But the end result is worth it: the business units understand IT thought processes and IT better understands business pain points, and together better decisions are made.