Situation: Lack of judicious IT spend

Situation: Lack of judicious IT spend

The trend has been changing since few years where CIO role is changing from ‘managing’ to ‘governing’. Given the critical link between IT and Business strategy, appreciation of IT Governance as a discipline within organizations is extremely essential to follow the strategy and guiding principals. While cost and risks are important imperatives to take right decisions, alignment of IT initiatives to business objectives is a key challenge. The prime reason for this challenge is high cost of keeping the lights on. Due to high cost on these non-discretionary projects, new initiatives are not taken up or are delayed due to non availability of sufficient funds.
Effective governance helps manage and contain this challenge. It helps decide, which initiatives are key to business so that investment is planned to improve IT value. IT Governance organization and processes help identify areas where cost can be reduced, which risks to be mitigated, what should be the common services, and adequate service level to ensure optimum support.
Orgamizations must assessthe IT Governance maturity in multiple dimensions and use processes and tools for effective IT demand management, service management, Project Portfolio management and Applications Portfolio Management.

Benefits
• Improved RoI through judicious demand management to analyze, prioritize, fund, approve and manage major IT investments (capital and operating expenses)
• Formalized IT oversight and accountability to ensure more effective and ethical management and selection, contract administration and management of sourcing initiatives
• Optimum service levels based on applications and infrastructure criticality to the business leading to better productivity and optimum resources
• Proactive Risk mitigation and management
• Portfolio management for projects and applications

Questions
1. Does IT have processes through which it communicates the value to business?
2. Is IT investment in your organization decided based on business value, an initiative delivers. Is business case developed and agreed between stakeholders for awarding budget to the projects?
3. Is projection for IT resources, infrastructure and competencies available to meet strategic objectives?
4. Does IT and IT related projects often go over budget?
5. Are Service Levels defined based on the applications and infrastructure criticality towards business and tracked for compliance?