Minimal IT - System governance cuts costs

31 January 2006

System governance cuts costs

System governance is not an expensive new bureaucracy to be imposed on IT. It is a way of cutting costs on work you would do anyway.

System governance covers many different areas.

Responsibility. Systems need strong business ownership, clear IT responsibilities, and support from capable and viable vendors.
Use. Systems should fit the task well, efficiently automate manual activities, and be fully accepted by their users.
Service. Systems need to perform well, be reliable and accurate, and meet agreed service levels.
Risks. Systems need to be secure, and data and systems must be recoverable after disruption.
Development. Systems should be stable and well tested. They should be well documented, easy to modify, and easy to retest.
Technology. Systems should run on standard, viable technology that can scale to meet future business needs.

Most large systems suffer from problems in some of these areas, and the problems tend to get worse as systems get older. These problems reduce the benefit that we get from systems. Often the difficulty and cost of fixing the problems is too high.

At its simplest, system governance is a way of organising and formalising standards. It provides a way of defining what we want to achieve, measuring how well we do, and defining the actions we need to improve. This makes it easier and cheaper to fix the problems.

System governance is not a separate process, but something that is applied to other IT activities.

System governance identifies technical risks within an individual project. Spotting these early reduces the cost of later rework. System governance can focus on the main issues sooner and at lower cost than the more typical approach of an ad hoc involvement of multiple specialists.
System governance provides a structure for a system selection process. It can provide a framework for the information that needs to be gathered, standard criteria that cover the compliance points most relevant to the organisation, and a method for scoring and identifying issues with each option.
System governance provides summary measures which help manage IT's performance. This is especially useful for managing an outsourced provider. It can be used as part of an IT dashboard, where it balances measures of IT project delivery with longer-term measures.
System governance tracks and enforces regulatory compliance. A new area of compliance does not need to be managed as a costly separate initiative, but can just be added as an additional criterion within the system governance framework.
System governance provides valuable input to work planning, for example identifying systems that could benefit from preventative maintenance.
Where changes in responsibility mean that new systems come under the IT function, system governance rapidly documents the systems and focusses in on important issues, without drowning in technical detail.

Although system governance can provide high-level control and accountability of the IT function, it is not an expensive new bureaucracy. It is a way of organising and formalising work that would have been carried out anyway. It reduces costs, while at the same time improving visibility, control, and accountability. And although system governance has great benefits when applied at a large scale, it is still worthwhile when applied at a small scale, even on a single project.