Sunday, March 2, 2014

Why IT Governance

The purpose of IT governance is to make sure EACH project delivered measurable unique value to business

In general, it is common in most organization that IT department initiates a project without having full agreement with business team or business sponsors on how to measure the benefits (ROI) of the program.

Michael Gerrard, Research Vice President and Distinguished Analyst from Gartner defines IT governance as the set of processes that ensure the effective and efficient use of IT in enabling an organization to achieve its goals. In other words, it is demand governance.

The very purpose of IT governance is "Doing things right" and "Do the right things"

Last month, I conducted a three days’ workshop on COBIT5 framework from ISACA at Copacabana Palace, Brasília.

Out of nine participants, three are CXO level executives from a local Telecom company - Zobni-systems. I found it is an interesting combination that marketing, customer support & finance head of a company joined IT governance training.

I found, during the day's session, they are quiet hands on with IT risk assessment and management process, enterprise architecture and related other IT methodologies.

As we were staying in Copacabana Palace, Rio de Janeiro, I catch them at hotel lobby in evening.

After initial exchange of greetings, I shifted our casual conversations to pointed questions.

I asked Ms. Alva, CMO of Zobni-systems "Why there is no representation from their IT team? What's the secret of their so much in depth knowledge on various ITIL processes along with COBIT framework?"

Ms. Alva leaned back in her chair & responded with a deep gratifying sigh looking at Ms. Amy, CFO of  Zobni-systems "2 million $, 2 years & 2 minutes".

With a tentative smile, I just managed to ask "WHAT?"

Mr. Gustavo, head of customer support of Zobni-systems replied, "We learned IT best practices in a tough way because last year everything went wrong related to our CRM upgrade. Under the leadership of our MD Mr. NoMo & consultant Mr. Lance we were all engaged with IT team to improve the performance of CRM system in a war footing."

Babi - COBIT5 expert
I nodded slowly. Moreover, with a wish to know more I tilted my body towards Mr. Gustavo and told him "I understand. However, it looks like there is an interesting story behind 2 million $, 2 years & 2 minutes. Would you please share that."

Ms. Alva chuckled with a wide grin. She replied while exchanging a knowing look with Mr. Gustavo and Ms. Amy that all this started with a 2 minutes discussion between herself & CIO Mr. Ranga.

Ms. Alva continued...

"Mr. Babi it’s an interesting story. You know our revenue stagnated for sometimes though we managed to maintain an average growth in customer acquisition around 10% year on year on basis. We engaged a reputed management consultant to improve our process."

After a small pause, she leaned forward & spoke with a gentle tone that the consultants from AT Kearney recommended to improve our CRM systems to support enhanced business process & SLAs.

Our board of directors approved 2million$ budget for CRM upgrade.

She started rubbing back of her neck and started talking again after tagging her scarf "Challenge was IT team and their vendor told it will take at the minimum 2 years to finish the entire CRM upgrade program. This throws our improvement plan related to customer satisfaction out of the window. After several rounds of meeting we surrendered to IT team’s approach of my way or no way”

Mr. Gustavo narrowed his eyes and intervened after clearing his throat "Actually!  To improve better customer experience, adding promotion after making first call & pay out commission to our dealers & distributors we started working in 3 shifts and deployed additional workforce at back end team to meet various key business KPIs”.

Ms. Amy was doodling till now on the napkin, tapped the table top and said with a deep sigh "I released the order for CRM upgrade worth of 2 million$ assuming just releasing the PO will solve our ordeal". Her self-pity appeared to be very dormant to me.

“Amy! Come on.  It is over now. We are within target for 10 major KPIs out of 15 and will manage the rest by next quarter. Don't you think today we are more able to handle IT issues whereas earlier we used to treat IT as a black box" Ms. Alva said in a polite way with an enthusiastic waving towards Ms. Amy.
Mr. Gustavo returned to the table after collecting few grilled chickens. Ms. Amy & I ordered Caipirinha drinks.

Alva sipped her Brazilian coffee and commented that actual drama started while I asked our CIO, Mr. Ranga why the features like householding for our subscribers  is not working and other issues like SLA not matching, implementation of new business intents are taking long time. 

Madam Alva added looking straight to me "You Know! Mr. Babi, Mr. Ranga responded that the project completed successfully. IT team did a brilliant work after stretched hours of working for a long period. We need to raise new change request for the functionality not working. He turned away from me and started walking on other direction murmuring that business team should stop blaming IT and do their work properly."

Mr. Gustavo who was enjoying grilled chickens & drinks until now started talking that this evasive behavior of Mr. Ranga dinged Ms. Alva so much that she called an emergency meeting with leadership team.

This 2 minutes discussion between Ms. Alva & Mr. Ranga is now famous in our organization as "2 minutes".

Editorial comment from Babi : As an implementer & assessor of COBIT5, I found this is an real life case study on  why IT governance is required. In next post, I'll share the discussion  why and how business team of   Zobni-systems  considered this as IT project failure.

 Share your comments below on importance of IT governance training.


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