IT Governance Overview
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The document discusses IT governance and the challenges faced by SMB CIOs in managing IT. It summarizes that IT governance aims to ensure IT dollars are spent on the right projects at the right time. However, the tools and processes typically used by large enterprises are too expensive, complex, and specialized for SMBs. The document then introduces the concept of on-demand CIO services as a more cost-effective solution for SMBs to access expert guidance and management of their IT operations and projects.
IT Governance Overview
- 1. IT Governance Subbu Murthy uGovernIT™, Inc. Confiden2al ©
- 2. Wikipedia Information technology governance is a subset discipline of corporate governance focused on information technology (IT) systems and their performance and risk management. The rising interest in IT governance is partly due to compliance initiatives, for instance Sarbanes- Oxley in the USA and Basel II in Europe, but more so because of the need for greater accountability for decision-making around the use of IT in the best interest of all stakeholders. uGovernIT™, Inc. Confiden2al ©
- 3. A CIO View The scope of IT Governance includes all technology components (IT infrastructure, telecommunications, software applications) and resources (IT personnel, user-IT teams) necessary to effectively develop and manage technology initiatives and resources within the Enterprise. The principal objective of the governance process is to enable the Enterprise achieve its business objectives. 3 uGovernIT™, Inc. Confiden2al ©
- 4. The Big IT Challenge Customers (users) always have issues/changes that require IT technical resources. Business changes, technology changes, regulatory changes and new ideas constantly create new project requests. Budget challenges, backlogged work requests and the need to incessantly innovate make resource alloca2ons challenging. 4 uGovernIT™, Inc. Confiden2al ©
- 5. Three Certain7es In Life We know the first two certain2es, the third is HR known to every IT Finance professional! Marke2ng Opera2ons Compliance There is always more Internal IT Projects work than available $ 5 uGovernIT™, Inc. Confiden2al ©
- 6. Goal of IT Governance Verifying that I.T. dollars are spent on the right projects, and just as importantly, at the right 2me 6 uGovernIT™, Inc. Confiden2al ©
- 7. CIOs are faced with 3 Concurrent Ac7vity Streams “Keep it running” Changes to opera2ons/problems are Business managed via service requests As Usual Innovate Op7mize “Increase Revenues” “Do More With Less” These are typically your strategic These projects are typically ini7a7ves implemented to get the improvements that drive efficiency best value to the way business operates 7 uGovernIT™, Inc. Confiden2al ©
- 8. How do BIG CIOs cope with this? They spend Mega $ on PMOs to manage tools and staff: projects, support Budge2ng & not just one-‐ staff to analyze Planning System 2me costs but performance and high recurring generate reports expenses Resource Management Asset Management Tools for managing customer support, services, projects and a Project Management separate tool for Integra2ng Data & Building Analy2cs Technical Services Customer Support 8 uGovernIT™, Inc. Confiden2al ©
- 9. These solu7ons are not prac7cal for the innova7ve SMB CIOs • The tools are expensive to acquire and 1 expensive to maintain • The tools and the associated Governance 2 processes are complex and onerous • The tools need custom integra2on to get 3 the whole picture • The tools are complex and need the 4 services of specialized staff 9 uGovernIT™, Inc. Confiden2al ©
- 10. SMB IT Governance From a Change Agent Perspec7ve 10 uGovernIT™, Inc. Confiden2al ©
- 11. Who manages IT for SMBs? 10 to 500 100 to 5000 employees employees S M IT Expenditures <$500K < $3M $3M+ Who manages IT? CFO I.T. Director CIO COO 11 uGovernIT™, Inc. Confiden2al ©
- 12. On-‐Demand CIO Services are gaining Trac7on There is a large pool of experienced CIOs who area ready to bring their expertise to help SMBs Retainer models ensure that there is a fixed cost but CIOs understand the workload fluctuations typical of SMB needs Strategy and developing the IT Blueprint for a SMB, and managing it does not require a full-‐time CIO Costs are typically a fourth of the cost of captive full-‐time CIO 12 uGovernIT™, Inc. Confiden2al ©
- 13. On-‐Demand CIO/CTO Services Model 13 uGovernIT™, Inc. Confiden2al ©
- 14. SMB IT Governance From a Process Perspec7ve 14 uGovernIT™, Inc. Confiden2al ©
- 15. The Keep IT Simple Approach Problem Management R E Q U E S T S S E R V I C E Service Management How do I? Service Fulfillment I have a Change Management problem I need something New Project Request R E Q U E S T S P R O J E C T Task Management New Project Review & Project Implementa2on Request Approval Process & Delivery Process Project Management User-‐IT IT Steering IT Steering Commijee PMO Governance Commijee M A N A G E M E N T Asset Asset Es2mate Catalog Acquisi2on Budget Budget Review Asset Management R E S O U R C E Resource Management Asset Budget Asset Management Asset Variance Management Budget Budget Management Disposi2on Alloca2on Tracking Approval Analy2cs & Dashboards Resource Asset Budget U2liza2on Alloca2on Management 15 uGovernIT™, Inc. Confiden2al ©
- 16. IT Governance Framework (1) Maturity Level Transforma2ona Efficiency Effec2veness l Design, develop and Align resource Technology Design, develop and deliver technology deliver IT Services priori2es to business Management ini2a2ves needs Plan and budget User Con2nuously evolve Triage and sequence with focus on services to meet projects to meet Benefit user needs business needs effec2ve resource u2liza2on Business Develop and meet Con2nuously evolve Con2nuously evolve SLAs to improve capabili2es to to innovate and add Benefit performance deliver innova2on business value 16 uGovernIT™, Inc. Confiden2al ©
- 17. Another Maturity Framework (2) Increases Revenues I IT is focused on gaining a IT is mature and provides the compe22ve edge. IT enterprise compe22ve Investments are focused on advantage and opera2onal revenue enhancements while efficiencies. minimizing risk. Smaller projects which can Leaders Trailblazers produce high value can get Efficiency may sacrificed lost in the priority shuffle. IT leading to higher budgets than is innova2ve but could add necessary. more risk. Increases Efficiency Reduces Risk E R IT is focused on just IT is focused on saving costs by maintaining systems and enabling the enterprise to be reducing exposure. Typically IT efficient. is limited to back-‐office IT tends to innovate less and Thrims Laggards opera2ons. could lead to obsolescence. User projects do not get IT is rarely used to build a priority. IT is rarely used to compe22ve edge. build a compe22ve edge. M 17 uGovernIT™, Inc. Confiden2al ©
- 18. SMB IT Governance From a Tool Perspec7ve 18 uGovernIT™, Inc. Confiden2al ©
- 19. Tool Perspec7ve: Need for an Integrated Solu7on A complete solution that is fully integrated and costs a lot less Out of the box, it should have the features, content and reports CIOs need It should be based on best practices such as ITIL and other standards but must be simple to use and practical It must be flexible and configurable to meet the needs today and grow to meet the needs tomorrow 19 uGovernIT™, Inc. Confiden2al ©
- 20. Governance Architecture This component helps configure the Configurator Governance to enterprise specific needs. Workflow Pre-‐built Work flows can be configured and Processor adapted to enterprise business process. Content Pre-‐built policies, procedures, rules, service levels can be customized to meet enterprise Manager specific requirements. Analy2cs can help managers and execu2ves Analy7cs measure and manage resource u2liza2on, efficiency and effec2veness. 20 uGovernIT™, Inc. Confiden2al ©
- 21. Tool should provide integrated dashboards Open Service Requests Project Status Resource Management Budget Management Low 233 On Track 23 Employee 93 Budget $2463K Medium 121 Minor Issues 14 s Consultants 54 Actuals $2445K High 168 Major Issues 8 Vendors 179 Variance $18K Open Request Types New Project Requests Top 3 Resource Centric Selected Budget Costs Issues 145 Pending Review 7 Projects Project A 25 PC Purchases $120K Services 329 Pending Approval 4 Project B 14 Consultant Costs $85K Changes 38 Pending Start 3 Project C 13 Somware $55K Maintenance Closed (past month) Task Lists Resource Hours Costs (current month) Issues 160 Open 45 Infrastructure 385 Infrastructure $400K Services 229 New 19 Apps Support 619 Apps Support $522K Changes 18 Closed 7 Projects 548 Projects $748K Other 368 Other $468K Service Requests (past 6 months) Project Costs (past 6 months) Resource U2liza2on IT Costs (past 6 months) 4 34% 29% 3 19% 18% 2 1 Infra-‐ Apps Projects Other Mar Apr May Jun Jul Aug Structure Support uGovernIT™, Inc. Confiden2al © uGovernIT™, Inc. Confiden2al © uGovernIT™, Inc. Confiden2al © uGovernIT™, Inc. Confiden2al © 21 CIO View uGovernIT™, Inc. Confiden2al ©
- 22. Tool should provide three lenses Ops Lens Services Lens Project Lens 22 uGovernIT™, Inc. Confiden2al ©
- 23. Tool should provide assessment frameworks Priority 1 Priority 2 Priority 3 Project ABC Project High BI Priority 2 Priority 3 Defer Business Value Project AVG Medium Priority 3 Priority 3 Defer Project Project Low PMM XYZ Low Medium High Project Cost 23 uGovernIT™, Inc. Confiden2al ©
- 24. Control Objec7ves for Informa7on & related Technology (CoBIT) Information Systems Audit and Control Association (ISACA) is a set of guidelines and supporting toolset for IT Governance that is accepted worldwide. It’s used by auditors and companies as a way to integrate technology to implement controls and meet specific business objectives. The Informa7on Technology Infrastructure Library (ITIL) ITIL from the government of the United Kingdom offers eight sets of management procedures in eight books: service delivery, service support, service management, infrastructure management, software asset management, business perspective, security management and application management. ITIL is a good fit for organizations concerned about operations. 24 uGovernIT™, Inc. Confiden2al ©
- 25. Commihee of Sponsoring Organiza7ons (COSO) This model for evaluating internal controls is from the Committee of Sponsoring Organizations of the Treadway Commission. It includes guidelines on many functions, including human resource management, inbound and outbound logistics, external resources, information technology, risk, legal affairs, the enterprise, marketing and sales, operations, all financial functions, procurement and reporting. This is a more business-general framework that is less IT-specific than the others. Capability Maturity Model Integra7on (CMMI) The Capability Maturity Model Integration method, created by a group from government, industry and Carnegie-Mellon’s Software Engineering Institute, is a process improvement approach that contains 22 process areas. It is divided into appraisal, evaluation and structure. CMMI is particularly well- suited to organizations that need help with application development, lifecycle issues and improving the delivery of products throughout the lifecycle. 25 uGovernIT™, Inc. Confiden2al ©