Scribd
Upload
24 views

Module 5

Uploaded by

georgeemil627
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
24 views

Module 5

Uploaded by

georgeemil627
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 6

What is IT governance?

Essentially, IT governance provides a structure for aligning IT strategy with business


strategy. By following a formal framework, organizations can produce measurable
results toward achieving their strategies and goals.

Organizations today are subject to many regulations governing the protection of


confidential information, financial accountability, data retention and disaster recovery,
among others. They’re also under pressure from shareholders, stakeholders and
customers. To ensure they meet internal and external requirements, many organizations
implement a formal IT governance program that provides a framework of best practices
and controls.

IT governance framework
The most commonly used frameworks are:

 COBIT: Published by ISACA, COBIT is a comprehensive framework of “globally


accepted practices, analytical tools and models” (PDF) designed for governance
and management of enterprise IT. With its roots in IT auditing, ISACA expanded
COBIT’s scope over the years to fully support IT governance. The latest version
is COBIT 5, which is widely used by organizations focused on risk management
and mitigation.

 ITIL: Formerly an acronym for Information Technology Infrastructure Library, ITIL


focuses on IT service management. It aims to ensure that IT services support
core processes of the business. ITIL comprises five sets of management best
practices for service strategy, design, transition (such as change management),
operation and continual service improvement.

 COSO: This model for evaluating internal controls is from the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). COSO’s focus
is less IT-specific than the other frameworks, concentrating more on business
aspects like enterprise risk management (ERM) and fraud deterrence.
 CMMI: The Capability Maturity Model Integration method, developed by the
Software Engineering Institute, is an approach to performance improvement.
CMMI uses a scale of 1 to 5 to gauge an organization’s performance, quality and
profitability maturity level. According to Calatayud, “allowing for mixed mode and
objective measurements to be inserted is critical in measuring risks that are
qualitative in nature.”

 FAIR: Factor Analysis of Information Risk (FAIR) is a relatively new model that
helps organizations quantify risk. The focus is on cyber security and operational
risk, with the goal of making more well-informed decisions. Although it’s newer
than other frameworks mentioned here, Calatayud points out that it’s already
gained a lot of traction with Fortune 500 companies.
Steps to implement successful IT governance
Implementing successful IT governance requires a multi-step process that
ensures value creation for your business.

The initial step is preparation, which involves engaging all stakeholders critical
to the company’s smooth operation. This group includes senior IT managers,
customers, employees, and partners. It’s essential to clearly define tasks and
responsibilities for each party to foster an IT strategy that contributes to the
company’s value creation. Setting priorities and determining which team
members will manage IT resources are also key components of this stage.

Next, it’s vital to develop an effective action plan that addresses specific IT
challenges and projects, while ensuring that the IT governance objectives are
in harmony with the business’s goals for value creation. Maintaining focus on
strategic goals during the IT governance setup is vital and for that, you need
to plan a long-term roadmap.
The communication of the IT governance plan completes the implementation.
All stakeholders should be informed of the IT governance plan to facilitate its
implementation.
IT for competitive advantage
 Efficiency
IT can automate and streamline business processes, which can reduce
costs and improve efficiency.
 Customer service
IT can help companies collect and analyze customer data, which can lead
to more personalized and responsive customer service.
 Decision-making
IT can provide real-time data, analytics, and reporting, which can help
companies make faster and more informed decisions.
 Product innovation
IT can provide insights into customer preferences, market trends, and
emerging technologies, which can help companies develop new products
and services.
 Product differentiation
IT can help companies differentiate their products or services through
features, performance, style, design, consistency, durability, reliability, or
maintainability.
 Services differentiation
IT can help companies differentiate their services through speed,
convenience, or care.
Role of Information Systems in Business¶
Despite the huge number of software applications out there, they mainly
serve three key purposes in business:

 Support of business processes and operations.


 Support of decision making by employees and managers.
 Support of strategies for competitive advantage.
1. Support for Business Processes and
Operations
Information systems are fundamental to the seamless execution of daily
business operations. They automate and manage a wide array of business
processes, including but not limited to inventory management, customer
relations, and payroll. By simplifying and streamlining these activities, IS
significantly reduce operational costs and enhance both efficiency and
productivity across the board. The automation of routine tasks frees up
human resources, allowing them to focus on more strategic activities that
add value to the business.

2. Support for Business Decision Making


In today's data-driven landscape, the ability to make well-informed decisions
swiftly is crucial for business success. Information systems provide a robust
framework for the collection, processing, and analysis of data, converting
raw data into actionable insights. These insights empower managers and
business leaders to make informed decisions, accurately forecast future
trends, and devise effective strategies. The analytical capabilities of IS,
therefore, are invaluable in navigating the complexities of the market and
maintaining a competitive edge.

3. Support for Strategic Competitive


Advantages
The competitive advantage of a business often hinges on its agility,
responsiveness, and innovation. Information systems are key enablers in this
regard, offering tools to identify new market opportunities, enhance
customer service, and foster the creation of innovative products or services.

IT portfolio management

What is ITPM?

IT portfolio management helps organizations establish and adopt a


process for measuring and monitoring the value of IT investments
Once an IT department becomes sufficiently large, there may be any
number of current or prospective projects to help the company stay
digitally competitive, along with standard maintenance and other
demands. ITPM helps categorize and monitor everything happening
within the IT department.

benefits of ITPM include:

 Centralized control
 Cost reduction
 More effective communication with business executives
 Increased return on investment (ROI)
 Enhanced customer service
 Respect among professional peers
 Competitive advantage
 IT infrastructure aligned with business objectives
 Better decision-making

Steps to implement ITPM.

1. Build a registry: Teams should first identify all IT projects


within the company, including current projects, ongoing
projects, and planned future projects. For each project, they
should provide estimates of associated costs,
expected timelines, and projected benefits, gathering all of this
information in a centralized registry.
2. Compare with strategic objectives: The business should
create a list of projects during the annual planning cycle. Each
project in the list should include the estimated cost, business
benefits, risk assessment, ROI, etc., to compare with
the company’s strategic objectives for that year.
3. Prioritize and categorize: In this next step, teams ensure
the prioritization and funding of the projects that most align
with their strategic objectives first. Using valuation criteria,
they then rank the remaining projects in terms of importance.
4. Manage and review the portfolio: The last step is one that
requires continued monitoring. Costs and ROI should be
regularly measured, for example, and compared to initial
predictions to further refine future assessments.
CRM

CRM stands for customer relationship management, which is a


system for managing all of your company’s interactions with current
and potential customers. The goal is simple: improve relationships
to grow your business. CRM technology helps companies stay
connected to customers, streamline processes, and improve
profitability.
ortant?

What is supply chain management (SCM)?

SCM includes all activities that turn raw materials into finished goods and put them into
customers’ hands.
Supply chain management definition
Supply chain management includes all activities that turn raw materials into finished goods
and put them into customers’ hands. This can include sourcing, design, production,
warehousing, shipping, and distribution. The goal of SCM is to improve efficiency, quality,
productivity, and customer satisfaction.

You might also like