How can CIOs meet these objectives while still living with current restrictions? By fundamentally changing how the IT department is run by implementing IT governance. It's a buzzword you'll hear a lot about this year. Here's why this new concept could be exactly what you've been looking for to improve processes without increased funds.
Defining IT governance
At its most basic level, IT governance is the set of policies, processes, and procedures that support everything else that IT does. Some disciplines that make up IT governance are change management, problem management, release management, availability management, and service-level management.
IT governance isn't sexy like the latest technology innovation, and no one is selling IT governance with hundred-million-dollar marketing budgets. Yet IT governance is at least as important as any piece of infrastructure or any application--perhaps more so in an environment where the CIO has to do more with less.
The need for IT governance
Thanks to enterprise applications, e-business, and Y2K, IT organisations were in constant fire-fighting mode from 1995 through 2000. The emphasis was on speed of implementation--even if this meant cutting corners or compromising on quality. This resulted in problems such as missed project deadlines, cost overruns, unanticipated downtime, and security lapses.
IT governance is meant to address and correct these bad habits. It's based on high-quality, well-defined, and repeatable processes. At a more detailed level, governance outlines policies, highlights procedures, requires meticulous documentation, and establishes a plan for constant improvement.
Models in place
There are several well-established IT governance models. The most popular is the IT Infrastructure Library (ITIL), which was formulated by the Central Computing and Telecommunications Agency (CCTA) for the UK government and is now owned by the Office of Government Commerce (OGC). ITIL has widespread support in Europe but is also gaining popularity in North America. ITIL defines a set of best practices in 24 disciplines.
Another established IT governance framework is the Control Objectives for Information and Related Technology (CobiT). CobiT was created to align IT resources and processes with business objectives, quality standards, monetary controls, and security needs. CobiT is composed of four domains:
- Planning and organisation
- Acquisition and implementation
- Delivery and support
- Monitoring
Each of these domains has a series of subdomains that fill in the details.
The ROI can be high
Many organisations have embraced ITIL and CobiT and have achieved measurable success. Proctor & Gamble adopted the ITIL model in 1997 and claims that through ITIL it has saved more than US$500 million over four years.
A study of the savings within Procter & Gamble's finance and accounting IT departments showed a six percent to eight percent cut in operating costs and a reduction in technology staff of between 15 percent and 20 percent.
Morton Cohen, Proctor & Gamble's manager of global service management, said, "When IT processes are done by 5000 people consistently across one company, service management can deliver tremendous savings."
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