IT governance, or how to align information systems and business strategy
In an economic context dominated by information, innovation and the race for performance, IT governance (or IS governance) seems to be emerging as one of the best strategies for optimizing IT resources.
Why is this?
Because it tends to align information systems and technologies with the company's overall business objectives, in a market and working environment increasingly geared towards digital transformation.
But what exactly are we talking about when we broach the subject of IT governance? What are the issues involved, and what frameworks need to be adopted to deploy an information system that is as close as possible to your organization's reality?
Find the answers in our dossier.
What is IT governance?
Definition of IT governance
The concept of IT governance is defined as a formal framework for developing information technologies in line with overall corporate objectives and strategy.
This process was born out of the realization that information systems generate value, and should no longer be considered as mere logistical support:
On average, [information systems] account for 15-20% of company sales, or around 50% of the added value generated by companies. Globally, this represents an amount in the order of 20,000 to 25,000 billion dollars.
Manifeste pour la Gouvernance des Systèmes d’Information
💡 We often find the notion of IT governance (or information technology governance) equated with that of IS governance (information systems governance or IS governance), or even IT governance.
IT governance: COBIT or ITIL, which framework should you choose?
IS governance is based on applications described in a number of reference frameworks. Focus on the two main ones.
ITIL (Information Technology Infrastructure Library)
The aim of ITIL? To standardize best practices in information management.
IT governance according to ITIL:
- Is integrated into overall corporate governance, even if the repository was not initially created for this purpose;
- Provides a basis for standardizing the actions of IT departments and the organization;
- Defines good organizational practices to optimize business processes.
COBIT (Control OBjectives for Information and related Technology)
Another well-known standard in the IT world, this one is more oriented towards governance. It is enriched by the contributions of ITIL, but aims above all to improve productivity and provide a managerial framework, in a business-oriented approach.
To achieve this, COBIT IS governance is based on five fundamental principles:
- Take all stakeholders into account;
- Cover the company's IT needs from end to end;
- Apply a single, integrated frame of reference;
- Implement a global approach to information systems;
- Separate governance and management.
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The difference between IT governance and IT management
After reading these few points, you may be wondering how IT governance differs from simple IT management.
In reality, there are nuances:
- IT governance is driven by the objective of sustaining the company's success and growth over the long term. This is why it is often ensured by a steering committee, which includes representatives from the IT department, as well as other key company players (company directors, certain business managers, etc.).
- IT management ensures that day-to-day activities and processes run smoothly. More technical profiles are involved in these tasks.
The challenges of IS governance
Creating value
Technology is only the means, not the end.
Manifeste pour la Gouvernance des Systèmes d’Information
Companies have come to realize that IT is no longer a purely operationalconcern... but a strategic one!
This awareness goes hand in hand with the fact that IT is no longer seen as a cost item to be contained: in a constantly evolving society and market, business costs are no longer linked solely to hardware or capital.
👉 Today, information reigns supreme, becoming a " raw material" to be produced, exploited, monetized and so on. Hence the importance of having a high-performance information system to manage data and extract value from it.
All in all, information systems are one of today's value-creating jobs. This implies coordination with management decision-making.
Improving business processes
Emerging challenges such as function automation, digital transformation and dematerialization are making business processes increasingly dependent on information systems.
Implementing IT governance means optimizing all these workflows, and thus increasing productivity and efficiency at all levels of the organization.
Optimizing costs
Optimizing processes also means optimizing costs. In other words, IT governance rationalizes IT investments according to real needs and priorities.
This implies a reduction in budgets allocated to non-priority items, while efforts are made for those that generate the most added value.
Managing risk
IT governance and risk management go hand in hand. CIOs must be able to anticipate them:
- through preventive measures such as incident management,
- by taking into account the regulatory context.
Taking IT risks into account when setting overall strategy provides a more realistic view of the company's situation, as well as better visibility of future expenditure, and is a real competitive advantage.
Enhancing performance and competitiveness
Thanks to better control of business processes and optimized information management, IS governance is a lever for performance and competitiveness.
Ultimately, the ultimate goal of IT governance remains to gain an undeniable competitive advantage, thanks to :
- adding value to IT services,
- strategic alignment with real business and market needs.
© Journal du Net
How do you manage your IT governance?
Identify the objectives to be met
Implementing IT governance involves :
- aligning with the company's strategy and short-term and long-term objectives;
- monitoring and measuring IT performance;
- ensuring that information systems create business value and generate a good ROI (Return On Investment);
- manage IT risks;
- anticipate future needs and developments in order to optimize IT actions;
- instill a culture of IT governance throughout the company.
Defining an IT strategy
To achieve this, it is necessary to create a strategic plan and define the best practices to be followed within the organization. Within this framework, roles are also defined, so that everyone knows what actions need to be taken.
If we follow the advice of the Manifesto for Information Systems Governance, this involves activities :
- planning and organization: implementing a proactive approach and planning activities in line with the company's real priorities, budgets and resources, all in accordance with business requirements;
- steering: ensuring that operational activities are in line with forecasts, and making adjustments if necessary (resources, budgets, etc.). This role generally falls to the CIO (chief information officer);
- coordination: coordinating not only the flow of requests, but also the actions of all the company's stakeholders;
- control: the most accurate control possible of the actions implemented, which must be measured (using KPIs and dashboards, for example) to ensure that they are always perfectly in line with the company's needs, and by extension those of its target customers.
Use the right tools for good IT governance
Given the various imperatives inherent in good IT governance, it goes without saying that the use of appropriate software is essential for the IT Department, in order to :
- gain an overview of projects, resource management and budgets,
- manage all IT projects as precisely as possible.
We can count on several types of software:
🛠️ IT management solutions:
Advantage: they focus on issues specific to IT department management in the broadest sense.
For example, Abraxio was developed by former CIOs with a keen understanding of business issues, and specializes in the management of IT department activities, including projects, budgets, teams and suppliers. This platform enables IT project portfolios to be managed in line with the company's vision, while promoting collaboration between teams.
🛠️ ITSM (Information Technology Service Management):
Advantage: they are used to manage the company's IT services in order to improve operational efficiency.
Example: EV Service Manager is a solution developed in line with ITIL best practices. Among other things, it streamlines processes, using workflows and automating low-value-added tasks. It also manages IT budgets with greater precision, thanks to visibility of financial data. All in a perfectly agile way.
🛠️ PPM (Portfolio Project Management):
Advantage: they support the company in the global management of all its projects.
Examples:
- Planisware Orchestra is a PPM perfectly suited to the complete management of IT projects, from idea to completion. What's more, you get a consolidated, reliable view of all your company's projects, so you can better align them with global objectives. All through an ergonomic, easy-to-use interface.
- Project Monitor is a tool for prioritizing and communicating the IT Department's roadmap within teams. Thanks to this PPM software, you can objectify project arbitration, effectively manage resource workloads and manage portfolio planning and budget preparation.
- Triskell goes further than PPM, positioning itself as a governance solution for SMEs and major accounts. With this platform, you address the entire value chain of corporate management, from strategy to operational execution. As a result, collaboration between management, business units and the IT department is strengthened.
IT governance and change management
IT governance therefore seems to fit in perfectly with performance-driven organizations, offering both a technical and organizational response to the increasing complexity of the market.
But if it is built around control and standardization, it is important that the company and its stakeholders take ownership of the subject, so as not to lose agility and innovation. That's why IS governance includes change management, which is essential if all teams are to adhere to the project and work together to effectively meet the same objective of value creation.
Article translated from French