June 2010 - Posts - The IT Governance Evangelist

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June 2010 - Posts

Is IT Governance Pie in the Sky?

Published: June 25 2010, 08:24 AM | 3 Comment(s)
by Steve Romero

I recently heard of some folks referring to my hero Peter Weill as being, "Too pie in the sky." It will come as no surprise to those of you who know me, this pushed one of my buttons.

Peter is the Chairman of the Center for Information Systems Research (CISR) at the MIT Sloan School of Management. Almost 10 years ago he wrote with Jeanne Ross, Director of MIT CISR, what continues to be the definitive book on IT Governance. (They wrote another stellar book just last year called "IT Savvy.") Peter and Jeanne lead a number of MIT research scientists at what I consider to be the best IT research organization on the planet. MIT CISR has been asking and answering the same question for the past 36 years, "How do Enterprises realize the most value from their investment in technology?" In the twilight of my now 32 year IT career, this one question now drives my every day.

I was at MIT just last week. It was my fourth time attending their phenomenal MIT CISR Executive Summer Session. The week was comprised of those things MIT CISR research shows as having the greatest effect on IT success in Enterprises today. Here was their agenda:

Maximizing Business Value in IT Savvy Firms
IT Leadership in a Business Transformation
Driving Competitive Advantage Through Agility & Innovation
The IT Unit of the Future: New Technologies, New Designs
IT-Enabled Change: Business Approaches, People Challenges

Friday's agenda on IT-Enabled Change focused on IT Governance, what Peter describes as the single most influential aspect of IT success. You can see why he is my hero.

I'm sure you can also understand why the pie-in-the-sky comment pulled my chain. If I had heard this admonishment a few years ago I would have surely ranted out loud, alone in my hotel room like a crazy person. But thanks to Twitter I now have a venting channel at my disposal 24/7. I immediately sent the following tweet:

"I'm sick of folks viewing IT-as-innovator as pie-in-the-sky. But OK, say it is. So let's find leaders to make it pie-on-the-table."

I followed that tweet with another:

"Not enough folks w/ the audacity/courage to make IT what it should be. Too many folks just want help doing the wrong thing better."

This triggered a flurry of tweets from @theitskeptic, @PeterKretzman, @_jfeldman, @wmmonroe, and @michael_keen on IT's role in the Enterprise. @mskaff had this offering:

"Or even pie-on-fork. Sadly, too many technology projects end up as pie-in-face."

The cleverness of his tweet aside, Michael Skaff, CIO of the SF Symphony, gets to the issue at hand - IT has problems requiring immediate solution. This immediacy places everyone (in the business as well as IT) in a position of simply wanting to know what to do to "just fix IT." I've mentioned this before. I occasionally encounter folks who roll their eyes after my IT Governance presentation, and here are some of their comments:

"It all sounds good, but it will never happen in my organization."
"THAT will take WAY too long."
"Just tell me what to do...NOW!"

As I continue to say, IT Governance is a journey. It is a journey that requires audacity, courage, perseverance and resilience. And the results of that journey are incredible, placing IT in the role of Strategic Business Asset vs. cost-center-to-be-managed. IT Governance raises the potential for IT organizations to move from supporters of the business (or worse, overheard) to innovators of the business.

And the beauty of taking the IT Governance journey is the potential to solve just the problems preventing many organizations from undertaking the journey in the first place. All of the day-to-day machinations of IT fall under the purview of IT Governance. Sound IT Governance is capable of improving systems development capability or provisioning or project delivery or any IT tactical issue requiring solution. The alligators in the swamp become the first bite you take out of the elephant with the vision for IT Governance painted on the horizon offering light at the end of the tunnel. (And yes, I was trying to set the record for number of clichés used in a single sentence.)

Peter and Jeanne will each tell you if IT is to have any chance of assuming the role of innovator, it must first "fix itself" and establish a reputation in the business for delivering the "bread-and-butter" aspects of IT's role. They will tell you it is only then that IT can consider maximizing business value, business transformation, driving competitive advantage & innovation and enabling business change - all of those "pie in the sky" aspirations.

All of this talk of pie has conjured a couple of peripheral thoughts. First, my wife bakes the best pies ever. Second is a sequence from one of my favorite movies of all time, Pulp Fiction. In one scene Bruce Willis' character Butch is talking about breakfast with Maria de Medeieros' Fabienne character:

Fabienne: "I'm ordering a big plate of blueberry pancakes with maple syrup, eggs over easy, and five sausages."
Butch: "Anything to drink with that?"
Fabienne: "A tall glass or orange juice and a black cup of coffee. After that, I'm going to have a slice of pie."
Butch: "Pie for breakfast?"
Fabienne: "Any time of day is a good time for pie."

I agree, even if it's pie in the sky.

Steve Romero, IT Governance Evangelist

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By: Steve Romero
Steve Romero is the IT Governance Evangelist at CA Technologies, Inc. His mission is to help enterprises realize the full potential of their IT investments for strategic and competitive advantage. In this capacity, he acts as a strong advocate for the customer, speaking around the world to users, prospective...
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IT Savvy to Achieve Superior Results

Published: June 15 2010, 01:50 PM | no comments
by Steve Romero

Is your firm IT Savvy? I hope so because according to MIT CISR http://cisr.mit.edu/ research, "IT Savvy firms have net margins 20% above their industry median." They also have a higher return on assets from technology sharing (ROAs 30% above industry median) and higher revenue growth (three percentage points higher than their industry median).

For those unfamiliar, the term was coined a few years ago by Peter Weill, Chairman of MIT CISR and Sinan Aral, now an Assistant Professor at NYU. I read their first white paper on the topic and they initially identified the five following characteristics as being representative but not exhaustive of firms with stronger overall IT Savvy:

IT for Communication - high use of electronic channels such as email, intranets, and wireless devices for internal and external communications and work practices.
Digital Transactions - a high degree of digitization of the firm's repetitive transactions, particularly sales, customer interaction and purchasing.
Internet Use - more use of Internet architectures for key processes such as sales force management, employee performance measurement, training and post-sales customer support.
Firm-wide IT Skills - high capability of all employees to use IT effectively. There are strong technical and business skills among IT staff, strong IT skills among business staff and an adequate market supply of highly skilled IT staff.
Business Management Involvement - strong senior management commitment and championing of IT initiatives. There is also strong business unit involvement in IT decisions resulting in partnership between IT staff and business units to help generate value from IT investments.

Peter and his colleagues at MIT CISR continued to refine and advance the idea of IT Savvy, culminating in a book he finished writing last year with Jeanne Ross, Director of MIT CISR http://bit.ly/dt9q0q. The book included an updated definition of IT Savvy as "the ability to use IT to consistently elevate firm performance." The publication is actually a culmination of over 20 years of their research and the idea of IT Savvy continues to dominate their thinking.

I'm writing this post after attending Day 1 of MIT's annual CISR Summer Session (which I highly recommend). The theme for the day was "Maximizing Business Value in IT Savvy Firms." The first topic on the agenda was delivered by Peter, "Becoming More IT Savvy and Increasing Firm Performance." The entire presentation was great, but here are my two favorite sections:

IT Savvy Firms Achieve Superior Results by Three Obsessions:

Fixing What's Broken

Actively manage the enterprise IT Portfolio - prioritize and balance the risk and return of the IT portfolio with rapid feedback loop
Establish clear decision rights and accountability - light-weight governance connecting IT and other key assets of the firm

Creating a Platform

Create a digitized platform for business execution and innovation - start with what's not changing, i.e., core business processes, data, technology, shared services

Exploiting the Platform for Profitable Growth

Reuse the platform for business agility and innovation
Empower employees with world-class information and systems

The 10 Digital Disciplines of IT Savvy Firms:

Govern, budget, and prioritize to build a digitized platform on project at a time - and then exploit it
Enable employees and managers to work together to manage risk
Design and manage enterprise architecture, standards, and exceptions for both business processes and technology
Define, price, deliver, and assess shared services explicitly
Recruit, develop and empower people to deliver in a digitized environment
Transparently manage IT unit costs and project performance
Match metrics and incentive programs to strategic goals
Run internal and vendor partnerships with shared risks based on business performance metrics
Use fast feedback to learn and adjust goals, business processes and projects
Design ownership and accountability for data process optimization

During the Q&A, I noted to Peter how his presentation listed characteristics and results of an IT Savvy firm, but it did not include a singular definition. I raised this point because I recognized that the definition had evolved between his first white paper on the subject and the book he wrote with Jeanne. I have known these two brilliant people for years so I am aware their ideas are in a constant state of evolution. Given this, I wanted them each to share their one-sentence "definition du jour" of IT Savvy.

After a little chuckle and an admission that the definition would continue to change in the future, Peter offered the following, "Thinking digitally." Jeanne agreed and added another definition she likes, "The ability to use IT as a strategic asset."

I loved both answers and I'm looking forward to following the inevitable evolution of what I consider to be a great concept. I urge you to read their book and to understand and determine your firm's level of IT Savvy. You can then strive to drive your firm to higher levels of IT Savvy to achieve superior results and the realization of more business value from your technology investments.

I hope to see you at next year's MIT CISR Summer Session. I'm sure the subject of IT Savvy will continue to dominate the proceedings.

Steve Romero, IT Governance Evangelist

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What is IT Governance?

Published: June 07 2010, 02:26 PM | 2 Comment(s)
by Steve Romero

I have been delivering my IT Governance presentation for over 5 years now (more than 3 years as CA's IT Governance Evangelist). Though I have made some minor changes over that time, I still find it my best device to help Enterprises understand and appreciate the power and promise of IT Governance.

Just today, at the Gartner PPM and IT Governance Summit, I used it to help some folks who were struggling with the definition. I have a number of IT Governance presentation events on the horizon and I don't anticipate a time in the foreseeable future when I will not longer deliver it. I spend so much time talking about IT Governance I thought it would be a good idea to devote a blog post to its basic description.

I always start with the simplest definition of IT Governance: The processes and relationships that lead to reasoned decision making in the use of IT. This includes:

What decisions need to be made?
Who is accountable for making the decisions?
How will the decisions be made?

I then add to the simple definition by incorporating the five principles of IT Governance prescribed by the IT Governance Institute (ITGI):

Ensuring IT is aligned with the business
Ensuring IT delivers value to the business
Ensuring IT manages risk
Ensuring IT manages performance
Ensuring IT manages resources

To meet those principles, IT must make the right decisions in relation to:

IT Archetype
IT Architecture
IT Infrastructure Strategies
IT Business Applications
IT Investment

IT Governance is a matter of assigning accountability and decision-rights in the areas above to ensure IT meets the principles of IT Governance. Most definitions of IT Governance stop there, relinquishing and relegating the execution of the decisions to "management." I think this is a grievous error. Instead, I contend IT Governance includes the myriad of approaches, methodologies, frameworks and their associated policies, standards and processes required to realize decisions. The relationship between technology decisions and these "IT Governance Processes" must be understood and optimized so the work (born of processes and their associated activities and tasks) can be measured to determine if the desired outcome of the decision is achieved.

Yes, I know, governance does not include execution per se. But I think it is irresponsible if not outright negligent for governing bodies (committees) to make decisions without some level of assurance and confidence that the enterprise has the constructs and mechanisms capable of realizing the decision. IT Governance processes are critical because they provide the evidence (based on work results) to determine if technology decisions produce targeted/desired outcomes. The people doing the work do not necessarily report to these governing bodies, but I still hold those committees accountable for providing the leadership and oversight to ensure the outcomes and quality of their decisions. To do so, they have to concern themselves with IT processes and associated work capabilities.

Here is my list of "IT Governance Processes":

Integrated Business & IT Planning
Architecture Management - Standards & Review
IT Investment Assessment, Prioritization, Funding & Benefits Realization Accountability (PPM)
Project Execution & Decision-making
IT Financial & Resource Allocation
Emerging Technology Evaluation & Adoption
Client Relationship Management
Building & Maintaining Applications & Infrastructure
Provisioning of IT Services
Outsourcing Services
Audit & Risk Management

These processes do not need to be manifested as discrete entities. I use this list to describe what is necessary to realize IT Governance decisions. Think of these processes as aggregates. For example, though an Enterprise may not have a "Provisioning of IT Services" process, you can find the collection of polices, standards and processes (ad hoc or formal) that provide the capability. (The words "numerous" and "hodge-podge" come to mind.)

To review: I align IT with the business, deliver value, manage risk, resources and performance by making the right decisions about my IT archetype, architecture, infrastructure strategies, applications and technology investments. I realize those decisions through my IT Governance processes that drive the work I measure to determine if my technology decisions produce their desired outcomes.

It sounds simple, but it's not. Institutionalizing sound IT Governance requires audacity, courage, resilience and perseverance. It is a journey, and the epitome of the cliché of eating an elephant one bite at a time. So here is my advice when establishing IT Governance:

Ensure IT Governance is driven by business problems and opportunities - not Governance for its own sake
No one-size-fits all - find the right flavor
Constantly strike the balance - not too much, not too little
Governance processes can be incredibly sophisticated and complex, or incredibly simple
Continually prove the value of IT Governance - The three M's: Metrics, Measures and Marketing

That's my IT Governance primer. Don't hesitate to contact me if you want a copy of my full-blown presentation. And I hope to see you in my travels, as I continue my quest to help organizations master this critical discipline.

Steve Romero, IT Governance Evangelist

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Process Management is the Answer

Published: June 01 2010, 11:48 AM | 1 Comment(s)
by Steve Romero

I recently had some renewed conversations and comments regarding my IT/Business Alignment post http://bit.ly/ahiyWf. The most recent comment, from @bob_williams, inspired this post. Here is what Bob had to say:

Hi Steve. I'd like to hear your thoughts on people and relationships crossing the functional boundaries to bring groups more in alignment. What you've written certainly looks good on paper. What concerns me though is that if this is just a list of IT goals then we don't break the pattern of IT and the "Business" working in their silos. It takes relationships and proper leadership to inspire people to work together on common goals.

Bob's comments reminded me of some remarks I received from a CIO following my IT Governance presentation just last week. He said my approach to governance was too absolute, and seemed to discount the fact that humans and their personalities could be the problem. He made a great point, and my presentation offered little retort. This is ironic given my simplest definition of governance: the processes and relationships that lead to reasoned decision-making. My presentation is 90% focused on the process aspect of the definition, vs. the relationship aspect, or more specifically, the people in the Enterprise.

This situation is very frustrating for me, given I have a presentation devoted to the "relationship" aspect. My process management presentation is the least dogmatic of any topic I cover, and by far the most obsessed with the human element of business success. This might seem surprising to some, but process management is entirely focused on delighting humans (customers) by affecting human behavior (workers). I usually have a mere 60, maybe 90 minutes to cover governance, or PPM, or PMOs. I am lucky to spend 5 minutes of that precious time stressing the critical aspects of process management, organizational culture, and human behavior. That is why I LOVE the rare opportunities to deliver my Process Management presentation.

So I will offer a couple of process tidbits I hope will cast more light on my contention that sound process management is the answer to Bob's question and the CIO's contention. The first is from the late and great Michael Hammer, my Process Godfather:

"Function-centric organizations are staffed by task workers with narrow perspectives and virtually total ignorance of the larger context in which they are working; in parochial organizational identification and affiliation, through which allegiance is given not to customer or company but to function and unit; and in incongruent measurement and reward systems that reinforce limited concerns and perspectives."

"The focus in a process is not on individual units of work, which by themselves accomplish nothing for a customer, but rather on an entire group of activities that, when effectively brought together, create a results that customer's value."

The next is an excerpt from my contribution to a recent book, "Business Driven PMO Setup", written by my friend Mark Perry http://bit.ly/aT8l29:

"Processes promote collaboration and team behavior. The process provides an end-to-end view of all of the work required to succeed. This understanding and appreciation aligns everyone on the process team around a common goal instead of instead of individuals preoccupied with isolated tasks. This helps to foster an appreciation for how each team member contributes to that common goal which enables and encourages team members to assist one another. Processes discourage finger-pointing and advances problem-solving because everyone associated with the process functions as a team."

IT Governance is more accurately described as Business Governance of IT. This governance starts and ends with the business. In the course of governing IT, IT Governance processes are born. These processes include business people, IT people, ALL the people, of the Enterprise. I argue process breaks down silos and makes the communication and collaboration necessary ultimately inherent to getting work done. Process and sound Process Management is the answer.

Steve Romero, IT Governance Evangelist

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June 2010 - Posts

Is IT Governance Pie in the Sky?

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IT Savvy to Achieve Superior Results

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What is IT Governance?

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Process Management is the Answer

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