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IT Investment Governance
know:
→ Area of IT that is concerned with value and resource management of IT.
→ How do we make decisions on what to spend IT money on and how do we ensure that IT delivers value.
→ How do they decide what they spend their money on for IT?
The two parts to governance:
Part 1: How does the organisation go through the investment process
Part 2: Ensuring value and how this value is measured. This is part of cost benefit analysis. They do BCs and
have finance people to manage this. Have dashboards to monitor.
→ Business and IT make the decisions together
Information Economics
The process for IT Investment
The process of IT spend decisions using Information Economics:
1. Briefly describe the industry (e.g. finance, retail, etc.)
2. Briefly describe the organisation
3. Establish the organisation’s evaluation criteria
4. Scan for contenders
5. Identify a short list
6. Select the best alternative
7. Recommend
Kinds of IT investments: What consultants will you employ, what software / hardware will you buy.
Step 3: Unpacking how to Establish the organisation’s evaluation criteria (step 3 of
process for IT Investment)
NB!!:
→ Has to do with what you are about to spend money on: HARDWARE, SOFTWARE OR SERVICES.
→ Criteria must, at minimum, cover cost, risk and benefit factors & an assessment of how well the project meets
needs.
→ Decide which of these criteria are the most NB.
Only once we have defined the criteria, THEN we look for contenders.
Examples of evaluation criteria: customer adoption rate, maturity of cloud solutions, flexibility & scalability of
solutions, ROI etc.
IT Investment Governance 1
, Use: weightings (5 = high, 1 = low) to rank importance of each criteria in a table.
Step 6: Select Best Alternative
Types of Criteria:
1. General Criteria: costs, vendor record, staff required, benefits expected, time, impact on organisation,
additional requirements, training
2. Functional Criteria: Inputs, outputs, queries, calculations, management information, interfaces, legal
compliance, user approval etc. In terms of ERP this is business process requirements.
IT Investment Governance 2
IT Investment Governance
know:
→ Area of IT that is concerned with value and resource management of IT.
→ How do we make decisions on what to spend IT money on and how do we ensure that IT delivers value.
→ How do they decide what they spend their money on for IT?
The two parts to governance:
Part 1: How does the organisation go through the investment process
Part 2: Ensuring value and how this value is measured. This is part of cost benefit analysis. They do BCs and
have finance people to manage this. Have dashboards to monitor.
→ Business and IT make the decisions together
Information Economics
The process for IT Investment
The process of IT spend decisions using Information Economics:
1. Briefly describe the industry (e.g. finance, retail, etc.)
2. Briefly describe the organisation
3. Establish the organisation’s evaluation criteria
4. Scan for contenders
5. Identify a short list
6. Select the best alternative
7. Recommend
Kinds of IT investments: What consultants will you employ, what software / hardware will you buy.
Step 3: Unpacking how to Establish the organisation’s evaluation criteria (step 3 of
process for IT Investment)
NB!!:
→ Has to do with what you are about to spend money on: HARDWARE, SOFTWARE OR SERVICES.
→ Criteria must, at minimum, cover cost, risk and benefit factors & an assessment of how well the project meets
needs.
→ Decide which of these criteria are the most NB.
Only once we have defined the criteria, THEN we look for contenders.
Examples of evaluation criteria: customer adoption rate, maturity of cloud solutions, flexibility & scalability of
solutions, ROI etc.
IT Investment Governance 1
, Use: weightings (5 = high, 1 = low) to rank importance of each criteria in a table.
Step 6: Select Best Alternative
Types of Criteria:
1. General Criteria: costs, vendor record, staff required, benefits expected, time, impact on organisation,
additional requirements, training
2. Functional Criteria: Inputs, outputs, queries, calculations, management information, interfaces, legal
compliance, user approval etc. In terms of ERP this is business process requirements.
IT Investment Governance 2
