Why a Good IT Governance Model Is Essential to a Good Digital Transformation Process

I have previously stated that the ability of CEO’s, C-suites and Boards to transform their companies from analog to digital business models will be the defining leadership challenge of the next 10 years. When tackling a challenge of this breadth and scope, it is often difficult to gain the necessary alignment, support and commitment to make the right trade-off decisions that will result in the desired outcomes.

At this point in time, many of the early adopters of digital transformation are focused on multiple trade-off decisions:

• How do we best accommodate the BYOD needs of our employees while still maintaining secure and stable access to and utilization of critical customer data?
• How do we create “friction-free” customer engagements from multiple mobile devices while still maintaining the security and privacy of those interactions?
• How do we effectively evaluate the trade-offs between a public, private or hybrid cloud structure?

The chart below highlights a number of other “trade-off” decisions that are primarily being orchestrated by CIOs and their senior leadership teams.

From my vantage point, one of the major challenges CIOs and their teams face in helping to move their companies into a digital-based business model is to lay out a compelling business case to support the redeployment of resources away from systems of record in the left column in the chart above to systems of engagement which are in the right column. Without a good decision-making governance model, it is extremely difficult to make good resource allocation trade-off choices between “run the business options” and “change the business options.” In most well-established companies, the legacy mindset trumps the innovative mindset.

As it turns out, my early work in this area has provided firsthand evidence at how critical an IT governance model is to a successful transformation process. The new Collaborative IT Governance Model shown below has proven to be a critical foundational element to break down hierarchal, silo- based decision-making processes and convert them to horizontal cross-enterprise decision-making processes. Simply put, good governance equals good decision-making. It has also been a valuable component to help CIOs and their teams build the necessary support and commitment to take the critical actions required to implement the digital transformation process.

For many companies who are starting to put together a digital transformation strategy, there is a tendency to get caught up in a series of silo-based technology infrastructure and application delivery trade-off discussions without the benefit of a solid governance model to enable a collaborative cross- enterprise decision-making process. Absent this governance model, these trade-off discussions often break down into individual fiefdom fights which ultimately result in the wrong decisions or no decisions at all. Needless to say that is not an outcome that is in the best interest for the long term success of your organization.

As always, I am interested in your comments, feedback and perspective on the ideas put forth in this blog. Please e-mail them to me at pdmoore@woellc.com.