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Is IT governance all about (or only about) the money?

“IT governance IS about the money,” said Michael Cohn, who currently heads up an eight-person IT governance committee at his accounting firm. “The IT governance committee should focus on the top initiatives that will bring the best ROI to the business,” said Cohn.

At last week’s Babson College Center for Information Management Studies (CIMS) executive session on IT governance, attendee Cohn voiced his opinion about the real goal of IT governance. “The business assumes within a budget year that capacity is fixed; if you need more capacity, you will likely require more money.”

Cohn, who is the director of the WolfPAC Integrated Risk Management Solution group at Boston-based Wolf & Company PC, said the governance process can be a long one and always ends up being a decision about the money. One example he offered was a request for smartphones with email. According to Cohn, it took months to get this request approved by the IT governance committee. The governance process dragged out because “they needed to know everything about the costs — for encryption requirements, compliance and anything that would affect the business bottom line,” said Cohn.

However, featured speaker Alex Cullen, who is also vice president, research director at Forrester Research, disagreed with Cohn’s comments. According to Cullen, IT governance is only partially about ROI and the money. “ROI is not the most complete way to gauge value of an investment,” said Cullen. Rather, governance is a process of processes and is really more about portfolios, he said.

According to the IT Governance Institute, “IT governance is an integral part of enterprise governance and consists of the leadership and organizational structures and processes that ensure that the organization’s IT sustains and extends the organization’s strategies and objectives.” Although money is not mentioned in this definition, you can’t deny the fact that achieving greater ROI and lowering costs are all critical decision factors when evaluating any IT decision that will affect the business.

Do you agree, then, that IT governance is about projects that will bring the most value to the business — and that in today’s economy, value is measured by money?

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