What is IT governance and how should it fit into every business?

What is IT governance and how should it fit into every business

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Did you know that the largest and most successful businesses today are data-driven and have extensive information technology (IT) infrastructures?

Did you also know that one-third of all small and medium-sized businesses lack an IT governance strategy?

Let’s take a step back. Have you heard about IT governance in business?

Nowadays, every successful organisation has a blueprint by which it operates.

This blueprint is known as a corporate governance framework.

Corporate governance consists of rules, practices, and processes that guide how a business is run and how its objectives are met.

It influences all aspects of a business’s operations, including the relationship between the board and shareholders, and the organisational hierarchy of the staff.

IT governance is a crucial element of the corporate governance framework, and here is everything you need to know about it.

What is IT governance?

Information Technology (IT) Governance is an element of corporate governance that aims to help the business align its IT strategy with its business strategy.

It enables the business to effectively manage its IT department and derive optimum value from its investment in IT.

Companies and businesses must ensure that their IT department is functioning optimally, without vulnerabilities and uncontrollable risk tendencies.

IT governance provides frameworks to help companies and businesses achieve this.

What are information technology governance frameworks?

IT governance frameworks provide guidelines for businesses to achieve their IT governance aims. They provide a roadmap that helps the business access and evaluates the effectiveness of its governance processes.

A good IT governance framework comprises three major elements – governance principles, governance structure, and governance processes.

  • Governance principles – are the set of underlying principles that all IT governance processes must adhere to.
  • Governance structure – defines the major stakeholders in the decision process, their roles and responsibilities, and the structural policies to be created.
  • Governance process – outlines the stages for the proposal, review, and approval or rejection of IT policies.

Individual businesses can only attempt to start building their own IT governance framework from scratch. There are presently a variety of IT governance frameworks created by the industry’s leading experts and are already being used by thousands of businesses and companies. A few of the commonly used frameworks are outlined in detail below.

  • Information Technology Infrastructure Library (ITIL)

The ITIL is an internationally recognised framework created by the British government’s Central Computer and Telecommunications Agency (CCTA) as a library of recommended best practices for IT service management. It describes processes and procedures that help businesses manage IT risks, embrace cost-effective practices and develop a sustainable IT department that enhances productivity and scalability for future growth.

The ITIL framework is divided into 5 phases, covering each stage of the IT service management lifecycle. The phases are service strategy, design, transition, operation, and continual service improvement.

  • Control Objectives for Information and related Technologies (COBIT)

COBIT is a globally recognised framework for IT best practices developed in 1996 by the Information Systems Audit and Control Association (ISACA). It is arguably the most popular IT governance framework. It promotes practices that help businesses achieve their objectives by exploiting available resources and mitigating risks associated with IT processes.

  • ISO 38500

The ISO/IEC 38500 is a framework jointly developed by the International Standard Organization (ISO) and the International Electrotechnical Commission (IEC). This high-level framework outlines principles and best practices for organisations to manage their IT processes better in order to fulfil their legal, regulatory, and ethical obligations. 

The ISO 38500 sets out six principles for good IT governance – Responsibility, Strategy, Acquisition, Performance, Conformance, and Human behaviour.

What are the benefits of having IT governance for businesses?

  • Entrenches management’s involvement in IT operations

In general, one of the biggest advantages of corporate governance is entrenching the organisational hierarchy and enhancing the vertical relationships at every stage. IT governance enhances this relationship by enabling the management executives to better direct, control, and monitor the business’ IT operations. This integrative approach adds value to the existing IT team because the management now has a clear vision of their functions and importance to the business.

  • Well-defined roles and responsibilities

IT governance provides a clear and definitive outline of the roles and members of everyone – from the members of the IT department to the senior management executives. This clarity helps ensure everyone does their job because they now understand what is expected of them.

  • Help optimally utilise data as a vital business resource

A huge amount of data is generated daily during the organisation’s business activities. IT governance, via a carefully detailed framework, ensures that this raw data is extracted and analysed appropriately. With an IT governance framework, the default scattergun approach is more effective in exploiting the raw data, and the organisation then needs to catch up on crucial insights.

  • Improves security and regulations compliance

In this digital age of data, with data being the premium resource, organisations that amass a considerable amount of data become vulnerable to cyberattacks and malicious actors. IT governance ensures adequate systems and structures are in place to defend the organisation from these threats. Various governments have also set rules and regulations on how organisations should handle their business data; an IT governance framework ensures the company’s IT operations do follow these regulations.

  • Builds trust and confidence across the board

When there is an IT governance framework that details everyone’s role in the IT operations and how policies are to be effected, everyone rightly feels involved – from the directors to the lowest member, everyone knows what is expected of them and what they should expect from others. This generates trust and confidence in the organisation and its IT operations. Customers and shareholders are now even more confident in their relationship with the organisation.

What are the risks of not having any IT governance framework?

Significant corporate transformation efforts fail due to poor or no IT governance. Poor or no IT governance increases costs owing to short-term, tactical IT deployments and ineffective use of people and IT assets. However, one-third of all SMEs still do not have any IT governance framework, which puts these businesses at risk. These risks include:

  • Non-compliance to relevant legal and ethical regulations
  • Vulnerability of the businesses’ data to external threats
  • Inability to properly execute IT-dependent business projects
  • A disjointed organisational structure stifles productivity as there needs to be more effective communication across hierarchies.
  • Gross mismanagement of the businesses’ IT resources and operations.

How can businesses start implementing IT governance?

Establishing an IT governance framework could seem daunting and intimidating initially, but with the right help, you can successfully deploy IT governance in your business.

  • The first step is to bring all stakeholders together to collaborate to help make informed decisions. There must be an open communication channel between IT personnel and top-level management executives. This is to understand the organisation’s needs better and identify the infrastructure (both physical and digital) it currently requires to be improved.


  • The next step is an in-depth overview of the organisation’s business strategy, customer demands, and key performance metrics. This is done to identify the current system’s strengths and weaknesses toward achieving this goal. A roadmap that outlines how IT can help contribute towards these objectives is discussed as well as the required level of investment and development needed for this to happen.


  • The last thing is ensuring that the IT governance plan complies with the existing legal, regulatory, and ethical policies. Every stakeholder must then work hand-in-hand to ensure the successful actualisation of the IT governance policy.

Create your IT governance framework today

It is often difficult for a business insider to give an objective analysis of the present strengths and weaknesses of the business; this intrinsic bias affects the decisions made and the framework’s overall effectiveness. 

This is why it is always prudent to consult a professional to get expert and specifically tailored advice on how best to deploy IT governance for your business.

It’s important to understand IT governance whether you’re on a team, a business owner, or just interested in the future of IT governance. This understanding is fundamental for the long-term growth and success of your business.

The Institute of Data provides Corporate Training Programs specifically designed to empower your organisation.

You can learn more about them by clicking this link.

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