IT Governance Challenges and Best Practices

To put it simply, IT governance is how an organization controls its IT resources and related activities like planning, directing, implementing, assessing, and so on to meet corporate objectives. IT governance is a subset of corporate governance, focusing on the strategy, value, risk, resource, and performance of IT.

Key components/activities include:

• Strategic alignment: Aligning enterprise strategy with IT strategy.

• Value delivery: Ensuring investments in IT deliver adequate returns in terms of business benefits.

• Risk management: Allocating responsibilities within a governance structure for identifying, assessing, and mitigating IT risks; knowing and managing IT risk is crucial.

• Resource management: Identifying and managing IT resources.

• Performance measurements: Measuring IT performance while also using organizational performance measures.

Why IT Governance is a Must

In our digital-first world, effective IT governance is important for several reasons:

• Business continuity: IT governance provides sufficient levels of access for authorized personnel to their critical systems and data when they need it.

• Protection of organization's proprietary intellectual property and sensitive data: IT governance provides assurances that the organization’s proprietary intellectual property and sensitive information are adequately protected from unauthorized access and/or leaks.

• Strategic alignment: Information technology can be disruptive, and IT governance ensures that investments meet or exceed the organization's return on investment.

• Increased Security and Risk Management: Minimizes exposure to cyber threats, data loss, and interruptions to service.

• Effective Use of Resources: Helps avoid redundancy and wasted IT resources.

• Regulatory Compliance: Provides assistance in achieving compliance for organizations (GDPR, HIPAA, and others).

• Improved Decision-Making: Increases visibility and accountability when it comes to IT decisions.

• Stakeholder Trust: Demonstrates a commitment to the secure and ethically-oriented use of IT.

Areas of IT Governance

IT governance is structured around five areas that mirror globally accepted frameworks such as COBIT, ISO/IEC 38500, and the NIST framework. Each area serves as an essential foundation for oversight and accountability toward managing IT resources, as well as facilitating the creation of strategic value delivery.

1. Strategic Alignment

This area ensures that IT is both supportive and enabling of the organization’s long-term strategic goals. This includes:

• Considering business priorities when developing IT initiatives through integrated planning.

• Determining means of communication between business leaders and IT leaders.

• Managing enterprise architecture as required to be adaptable and limit fragmentation of services.

2. Value Delivery

This area focuses on ensuring that the organization receives the maximum organizational benefits from investing in IT. Value delivery involves:

• Providing measurable value from translating IT strategy.

• Providing SLAs that are aligned with business expectations.

• Monitoring the actual ROI from IT and realigning those resources if necessary.

3. Resource Management

The resource management area focuses on creating efficiencies in the use of IT resources—both human and technical/financial—in service creation, delivery, and support. Resource management involves:

• Managing technical and non-technical assets, infrastructure, and people through lifecycle governance.

• Managing supply and demand for IT services to avoid bottlenecks in resource availability.

• Capacity planning and skills assessment for workforce maximization and resources.

4. Risk Management

Extremely important, risk management provides an understanding of threats before they impact business continuity or compromise compliance capabilities. The activities associated with risk management include:

• Identify, assess, and prioritize cyber, operational, and compliance risks.

• Implement preventative controls such as identity management, access control, and encryption.

• Implement incident response and business continuity plans to limit the impact of disruption.

• Implement an appropriate security standard such as Zero Trust to limit the business blast radius of compromise.

5. Performance Measurement

Performance measurement is required as part of a governance framework to track whether IT activities are contributing to the operational efforts of the business:

• Define and monitor KPIs on availability, reliability, security, and efficiency.

• Use dashboards and scorecards for organizational visibility and accountability.

• Conduct routine audits and undertake regular performance measurement and review to ensure continuous improvement.

The five domains mutually support one another to form a governance framework that provides an element of transparency and accountability and can deliver greater business value to IT products and services.