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Predicting IT Governance Performance: A Method for Model-Based Decision Making
KTH, School of Electrical Engineering (EES), Industrial Information and Control Systems.
2008 (English)Doctoral thesis, comprehensive summary (Other scientific)
Abstract [en]

Contemporary enterprises are largely dependent on Information Technology (IT), which makes decision making on IT matters important. There are numerous issues that confuse IT decision making, including contradictive business needs, financial constraints, lack of communication between business and IT stakeholders and difficulty in understanding the often heterogeneous and integrated IT systems. The discipline of IT governance aims at providing the decision making structures, processes, and relational mechanisms, needed in order for IT to support and perpetuate the business. The adjacent discipline of enterprise architecture provides a broad range of frameworks and tools for model-based management of IT. Enterprise architecture is a commonly and successfully used approach, but the frameworks need to be adapted with respect to the concerns at stake in order to become truly useful.

The IT organization includes all people involved in decision making regarding IT. The quality of the IT organization differs between enterprises and depends on aspects such as: are rights and responsibilities assigned to the appropriate people, are formalized processes implemented, and does proper documentation exist? This internal IT organization efficiency is labeled IT governance maturity. One might argue that internal efficiency metrics of the IT organization are of moderate interest only. What really matters is the external effectiveness of services that the IT organization delivers to the business. This latter effectiveness is labeled IT governance performance. Even though it is reasonable to believe that enterprises with good IT governance maturity also achieve high IT governance performance, the validity of this assumption has never been tested. IT management’s ability to make well-informed decisions regarding internal IT organization matters would increase if it were possible to predict IT governance performance.

The contribution of this thesis is a method for model-based IT governance decision making. The method includes a metamodel, i.e. a modeling language, and a framework for the assessment of IT governance maturity and performance. The method also allows prediction of IT governance performance. 

This thesis is a composite thesis consisting of four papers and an introduction. Paper A presents an overview of the method for model-based IT governance decision making. Paper B presents the mathematical foundation of the prediction apparatus, i.e. a Bayesian network that is based on statistical data. Paper C presents how the method can be used in practice to support IT governance decision making. Finally, Paper D analyzes the correlation of IT governance maturity and performance. The analysis is based on statistical data from case studies in 35 organizations.

Place, publisher, year, edition, pages
Stockholm: KTH , 2008. , ix, 28 p.
Series
Trita-EE, ISSN 1653-5146 ; 2008:42
Keyword [en]
IT governance, IT governance maturity, IT governance performance, Enter-prise Architecture, Bayesian networks.
National Category
Computer and Information Science
Identifiers
URN: urn:nbn:se:kth:diva-9129OAI: oai:DiVA.org:kth-9129DiVA: diva2:24307
Public defence
2008-10-17, E1, KTH, Lindstedtsvägen 3, Stockholm, 10:00 (English)
Opponent
Supervisors
Note
QC 20100909Available from: 2008-10-03 Created: 2008-09-22 Last updated: 2010-09-09Bibliographically approved
List of papers
1. The IT Organization Modeling and Assessment Tool: Correlating IT Governance Maturity with the Effect of IT
Open this publication in new window or tab >>The IT Organization Modeling and Assessment Tool: Correlating IT Governance Maturity with the Effect of IT
2008 (English)In: Proceedings of the 41st Hawaii International Conference on System Sciences, 2008Conference paper, Published paper (Refereed)
Abstract [en]

Does good IT governance improve the effect of IT? This paper presents the IT Organization Modeling and Assessment Tool (ITOMAT) which has been created to overcome operationalization and subjectivity weaknesses in the Control Objectives for Information and related Technology (COBIT) framework. ITO-MAT was applied to assess IT governance maturity in four case studies. Simultaneously, external metrics of the effect of IT were collected and correlated to the maturity levels. Based on the correlations, a model linking internal and external measures was created. The model can be used to predict the effect of IT given the maturity levels of IT processes.

Keyword
IT governance, IT organization, effect of IT, COBIT, modeling
National Category
Computer and Information Science
Identifiers
urn:nbn:se:kth:diva-9123 (URN)10.1109/HICSS.2008.447 (DOI)2-s2.0-51449115503 (Scopus ID)978-0-7695-3075-8 (ISBN)
Note
QC 20100909Available from: 2008-09-22 Created: 2008-09-22 Last updated: 2010-09-09Bibliographically approved
2. A Bayesian Network for IT Governance Performance Prediction
Open this publication in new window or tab >>A Bayesian Network for IT Governance Performance Prediction
2008 (English)In: Proceedings of the 10th International Con-ference on Electronic Commerce, 2008Conference paper, Published paper (Refereed)
Abstract [en]

The goal of IT governance is not only to achieve internal efficiency in an IT organization, but also to sup-port IT‟s role as a business enabler. The latter is an ability of an organization here denoted as IT gover-nance performance. IT management cannot control the IT governance performance directly. Instead, their realm of control includes several IT governance maturity indicators such as the existence of different IT activities, documents, metrics and roles. Current IT governance frameworks are suitable for describing IT governance, IT-systems, and business processes, but lack the ability to predict how changes to the IT gover-nance maturity indicators affect the IT governance performance. This paper presents a Bayesian network for IT governance performance prediction. Bayesian networks are widely used for goal modeling and prediction in other research fields. Data from 35 case studies conducted in a variety of organizations has been used to determine the behavior of the network. An assumption on linearity is introduced in order to compensate for the limited amount of data, and the network learns using the proposed Linear Conditional Probability Matrix Generator. The resulting Bayesian network for IT governance performance prediction can be used to support IT governance decision-making.

 

Keyword
IT Governance, Bayesian networks
National Category
Computer and Information Science
Identifiers
urn:nbn:se:kth:diva-9124 (URN)10.1145/1409540.1409542 (DOI)2-s2.0-65449158454 (Scopus ID)
Note
QC 20100909Available from: 2008-09-22 Created: 2008-09-22 Last updated: 2010-09-09Bibliographically approved
3. IT Governance Decision Support using the IT Organization Modeling and Assessment Tool
Open this publication in new window or tab >>IT Governance Decision Support using the IT Organization Modeling and Assessment Tool
2008 (English)In: 2008 Portland International Center for Management of Engineering and Technology, Technology Management for a Sustainable Economy, PICMET '08, New York: IEEE , 2008, 802-810 p.Conference paper, Published paper (Refereed)
Abstract [en]

It is important to ensure that the IT governance is not only designed to achieve internal efficiency in the IT organization, such as deploying good IT processes and making sure that the means and goals are docu-mented. The final goal of good IT governance is rather to provide the business with the support needed in order to conduct business in a good manner. This paper describes the IT Organization Modeling and As-sessment Tool (ITOMAT) and how it can be used for IT governance decision making. ITOMAT consists of an enterprise architecture metamodel that describes IT organizations. ITOMAT further contains a Bayesian network for making predictions on how changes to IT organization models will affect the IT governance performance as perceived by business stakeholders. In order to make such predictions accurately, the network learns from data on previous experience. Thorough case studies at 20 different companies have been conducted in order to calibrate the network. Finally, the paper describes a case study where ITOMAT was used to analyze the future impact of two IT organization change scenarios in a medium sized engineer-ing company.

 

Place, publisher, year, edition, pages
New York: IEEE, 2008
Keyword
IT governance, IT organization, Enterprise Architecture, modeling, metamodel
National Category
Computer and Information Science
Identifiers
urn:nbn:se:kth:diva-9126 (URN)10.1109/PICMET.2008.4599688 (DOI)000261710000087 ()2-s2.0-52449117428 (Scopus ID)978-1-890843-17-5 (ISBN)
Conference
Portland International Conference on Management Engineering and Technology Univ Pretoria, Cape Town, SOUTH AFRICA, JUL 27-31, 2008
Note

QC 20100909

Available from: 2008-09-22 Created: 2008-09-22 Last updated: 2014-01-22Bibliographically approved
4. The Effect of IT Governance Maturity on IT Governance Performance
Open this publication in new window or tab >>The Effect of IT Governance Maturity on IT Governance Performance
2010 (English)In: Information systems management, ISSN 1058-0530, E-ISSN 1934-8703, Vol. 27, no 1, 10-24 p.Article in journal (Refereed) Published
Abstract [en]

There are several best practice based frameworks that detail effective arrangements for the internal structure of an IT organization. Although it is reasonable that there is a correlation between the quality of the internal structure of an IT organization - labeled IT governance maturity, and the external impact of the same IT organization on the business - labeled IT governance performance, this has not been validated. The results, based on 35 case studies, confirm the hypotheses of a positive correlation between IT governance maturity and IT governance performance. Among IT processes described in 34 references, the internal structure of the IT organization, clearly defined organizational structures and relationships, mature quality management, and cost allocation show the strongest positive correlation to IT governance performance. The maturity of project management and service level management, as well as performance and capacity management, show almost no correlation to IT governance performance. The findings can be used to improve current frameworks for IT governance.

Keyword
alignment of IS organization, business value of IT, governance of the IS organization, IS organization transformation, strategic IS planning
National Category
Computer and Information Science
Identifiers
urn:nbn:se:kth:diva-9127 (URN)10.1080/10580530903455106 (DOI)000273610800003 ()2-s2.0-74949088846 (Scopus ID)
Note
QC 20100909. Uppdaterad från submitted till published (20100909).Available from: 2008-09-22 Created: 2008-09-22 Last updated: 2017-12-13Bibliographically approved

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