Local organisations fall behind when it comes to IT governance and see the practice as a cost imposition, instead of a value proposition. This is the wrong approach.
A board of directors' primary function is to maximise value for all stakeholders. Governance is the process by which value is evaluated, directed and monitored. Why then does IT's performance always disappoint?
This was the question posed by Mike Jarvis, CEO of OverSight Solutions, speaking during ITWeb's Governance, Risk and Compliance event, in Bryanston, this morning.
It is his view that a radical mindset change is needed when it comes to IT governance. He says the value of IT and how to maximise it are not being adequately addressed.
Another problem, he says, is that most directors and executives have little understanding of IT and don't know how it can solve problems, what value drivers are critical to technology, and what measures are relevant. Similarly, he says most CIOs and IT executives place too little value on the business value to be gleaned from technology.
Most CIOs do not know how to report value comprehensively and in a way that directors understand, especially when it comes to what services produce value, what drives consumption, and what trade-offs exist between service, quality and cost.
Jarvis says that IT can, and should, be governed in exactly the same way as any other corporate discipline. He says the US approach, which combines legislation such as Sarbanes-Oxley and auditing routines, has led a box-ticking approach that is woefully inadequate.
"Unfortunately, this has framed governance as a cost imposition rather than as a true value proposition."
He says Sarbanes-Oxley was largely a knee-jerk reaction to the Enron disaster, and is not the correct approach. In SA, King III, which uses an 'apply or explain approach', challenges directors to govern in the real sense of governance by reading the guiding principles and practices and then applying them according to individual circumstances.
Jarvis believes it is unreasonable to expect directors and executive management to become IT experts, but says they need to become more comfortable in their role of governing IT.
Similarly, he says CIOs and IT executives need to manage the effectiveness of IT and of satisfying all stakeholders that technology investment is optimised.
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