A business risk approach to IT governance


Introduction The last 50 years have witnessed a dramatic evolution in the strategic importance of information technology (IT) to business initiatives. Corporations first began utilizing IT in the 1960s with the adoption of monolithic mainframes to conduct back-office data processing functions. In the ensuing 40 years, information technology has migrated away from being a pure cost-center into a central function to the successful execution of corporate strategic objectives. Today, IT operationalizes the majority of every business function within an organization. Leading companies across all industries have all used information technology to help advance corporate objectives such as branding, financial efficiency and customer service. Despite rapid changes in the role of information technology in business, information technology managers and business managers often find themselves at odds with each other. Business managers need IT to support new business initiatives yet IT is often unable to provide the necessary systems to support these initiatives in a meaningful manner. The result is spiraling costs and organizational inefficiencies. Mergers and acquisitions compound the problem by requiring integration and consolidation between disparate and incompatible IT applications and systems. Unfortunately for IT managers, the pace of mergers and acquisitions is not slowing down, meaning that these integration challenges will persist. As corporate information technology infrastructure increases in size and complexity, corporations are recognizing the need for a better mechanism for assessing IT’s role and alignment to the key corporate initiatives. What began as a series of best practices has evolved into the field known as IT governance. This white paper is for business and technical people and introduces the key concepts and challenges with IT governance and introduces readers to the IT governance solution provided by IBM.

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