Enterprise Governance of Information Technology: Achieving Alignment and Value, Featuring COBIT 5

178 Pages·2015·9.96 MB·English

by  Steven De Haes

Management for Professionals
Steven De Haes
Wim Van Grembergen
Enterprise
Governance of
Information
Technology
Achieving Alignment and Value,
Featuring COBIT 5
Second Edition
Management for Professionals
More information about this series at h ttp://www.springer.com/series/10101

Steven De Haes (cid:129) Wim Van Grembergen
Enterprise Governance
of Information Technology
Achieving Alignment and Value,
Featuring COBIT 5
Second Edition
Steven De Haes Wim Van Grembergen
Information Technology Alignment Information Technology Alignment
and Governance Research Institute and Governance Research Institute
University of Antwerp - Antwerp University of Antwerp - Antwerp
Management School Management School
Antwerp , Belgium Antwerp , Belgium
ISSN 2192-8096 ISSN 2192-810X (electronic)
Management for Professionals
ISBN 978-3-319-14546-4 ISBN 978-3-319-14547-1 (eBook)
DOI 10.1007/978-3-319-14547-1
Library of Congress Control Number: 2015932080
Springer Cham Heidelberg New York Dordrecht London
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© Springer International Publishing Switzerland 2015
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Pref ace
“Enterprise Governance of IT” is a relatively new concept in the literature and is
gaining more and more interest in the academic and practitioner’s world. “Enterprise
Governance of IT” is about defi ning and embedding processes and structures in the
organization that enable both business and IT people to execute their responsibili-
ties in creating value from IT-enabled business investments. As an example of its
growing importance, the standardization organization ISO issued in 2008 a new
worldwide ISO standard in this domain.
W ithin the University of Antwerp–Antwerp Management School–IT Alignment
and Governance (ITAG) Research Institute, we have been executing applied research
in this domain for many years now. With this book, we want to provide a complete
and comprehensive overview of what Enterprise Governance of IT entails and how
it can be applied in practice. Our conclusions in this book are based on our knowl-
edge obtained in applied research projects, our many years of involvement in the
development of COBIT, our own hands-on coaching and consulting experience in
many industries in governance and alignment projects, and international state-of-
the-art literature. In this way, this manuscript encompasses both academic models
and concepts but also includes practice-oriented frameworks such as COBIT and
discusses and analyzes many practical cases and examples in different industries.
The target audience for this book is threefold:
(cid:129) M aster students, for whom this textbook can be used in courses typical on IT
strategy, Enterprise Governance of IT, IT management, IT processes, IT and
business architecture, IT assurance/audit, information systems management, etc.
(cid:129) Executive students in business schools, for MBA type of courses where IT strat-
egy or IT management modules are addressed.
(cid:129) Practitioners in the fi eld, both business and IT managers, who are seeking
research-based fundamentals and practical implementation issues related to it in
the domain of Enterprise Governance of IT.
T his book is organized into seven main chapters. Chapter 1 defi nes the core
concepts around Enterprise Governance of IT as a means to enable business/IT
v
vi Preface
alignment and business value from IT. This chapter sets the scene of the complete
book. Chapter 2 builds on the fi rst chapter and stipulates a conceptual model to
address the challenge of implementing Enterprise Governance of IT in practice.
This chapter also provides an overview of contemporary best practices organiza-
tions are using and addresses related topics on, for example, the role of the board of
directors in Enterprise Governance of IT and the context of interorganizational envi-
ronments. In Chap. 3 , the impact of Enterprise Governance of IT implementations
on business/IT alignment is discussed. The fi rst question is how an organization can
measure and evaluate its current status of business/IT alignment. This discussion is
supplemented with a benchmarking case, where business/IT alignment was mea-
sured for the Belgian fi nancial services sector. Next, the impact of Enterprise
Governance of IT practices on business/IT alignment is analyzed and illustrated.
Chapter 4 discusses the value component of this textbook. It starts from describing
the IT productivity paradox and then discusses two approaches to measure and man-
age the value of IT, at the level of an investment through the business case process
and at the level of the IT department through the IT balanced scorecard. Chapter 4
also includes a detailed case study of a working IT balanced scorecard implementa-
tion. Chapter 5 positions COBIT in the fi eld of Enterprise Governance of IT. This
chapter discusses in detail all the core elements of the COBIT framework and
explains how organizations could leverage them for the purpose of Enterprise
Governance of IT. Related to this, Chap. 6 continues by discussing how COBIT can
also be leveraged as a framework to execute IT assurance/audit assignments. This
chapter also offers a lot of hands-on templates that can be used in practice. Chapter
7 fi nally provides some guidelines and trigger events to get started with Enterprise
Governance of IT and outlines a balanced scorecard for Enterprise Governance of
IT to manage and measure the outcome of the enterprise governance of IT project.
T o support the reader in understanding and absorbing the material provided, each
chapter provides (short and long) “assignment boxes” where readers can apply the
concepts explained in comprehensive exercises. Also, at the end of each chapter, a
summary and study questions are available enabling the reader to cross-check the
insights obtained in a chapter. For people who want more information, each chapter
provides hooks to more detailed background material by way of literature references.
We hope that with this book, we can contribute to further developing the emerg-
ing knowledge domain of Enterprise Governance of IT. This book is one of the
outcomes of our activities within the University of Antwerp–Antwerp Management
School–IT Alignment and Governance (ITAG) Research Institute. We do welcome
reactions on this book or sharing experiences in the domain of Enterprise Governance
of IT via [email protected] and [email protected].
Antwerp, Belgium Steven De Haes
January 2015 Wim Van Grembergen
Acknowledgments
We would like to thank all participants involved in our research and teaching activi-
ties and in writing this book. Without the support of these people, the development
of this book could not have been satisfactorily completed.
We gratefully acknowledge the business and IT managers who shared their
insights and practices on Enterprise Governance of IT and participated in one or
more of our research projects. We appreciate support provided for this project by the
Business Faculty of the University of Antwerp and the Antwerp Management
School, by our colleagues in these institutions, and by other international colleagues
we had the opportunity and honor to work with. We also would like to thank our
master and executive students who provided us with many ideas on the subject of
Enterprise Governance of IT and its related mechanisms.
We would also like to express our gratitude toward the board of directors, the
management committee, and all the staff and volunteers of the ISACA. Our involve-
ment in the COBIT development activities has been of great value in further pro-
gressing our ideas.
We also thank Springer who showed great interest in our research and book proj-
ect and from whom we received magnifi cent support in managing this project.
F inally, last but not least, we would like to thank our families. Wim would like to
extend his gratitude to Hilde, Astrid, and Helen who always supported and helped
him with every project including this book. Steven wishes to thank Brenda for her
loving support and patience and wants to dedicate this book to Ruben, Charlotte,
and Michiel.
vii

Contents
1 Enterprise Governance of IT, Alignment and Value .............................. 1
1.1 Enterprise Governance of IT in the Context
of Digitized Organizations ................................................................. 1
1.2 Business/IT Alignment ...................................................................... 4
1.3 Value from IT ..................................................................................... 6
Summary ..................................................................................................... 8
Study Questions .......................................................................................... 9
References ................................................................................................... 9
2 Enterprise Governance of IT ................................................................... 11
2.1 Practices for Implementing Enterprise Governance of IT ................. 11
2.2 Principles for Enterprise Governance of IT ....................................... 18
2.3 Case Study: Enterprise Governance of IT at KLM ............................ 19
2.3.1 KLM’s Trigger Points to Start the Journey ............................ 20
2.3.2 Embarking on the Journey ..................................................... 21
2.3.3 Reported Benefi ts ................................................................... 29
2.4 Enterprise Governance of IT and the Board ...................................... 32
2.5 Intraorganizational Governance of IT ................................................ 36
2.6 Theoretical View on EGIT: Viable Systems Theory .......................... 37
2.6.1 System 1: The Productive Function ....................................... 39
2.6.2 System 2: The Coordination Function ................................... 39
2.6.3 System 3: The Executive Function ........................................ 40
2.6.4 System 4: The Planning and Future Focus Function ............. 40
2.6.5 System 5: The Coherence Function ....................................... 40
2.7 Applying the VSM in the Context of Enterprise
Governance of IT ............................................................................... 40
Summary ..................................................................................................... 42
Study Questions .......................................................................................... 42
References ................................................................................................... 43
ix