Information silos and IT governance failure

Information silos and IT governance failure

Summary: "Governance" is a badass sounding phrase that simply means establishing policies to enable consistent management by exception. But many governance initiatives are doomed to fail.

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TOPICS: CXO
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"Governance" is a badass sounding phrase that simply means establishing policies to enable consistent management by exception. Unfortunately, many so-called governance initiatives are doomed to enter the annals of IT failure history.

In a post titled, Linear Thinking and the CIO, blogger Eric D. Brown describes a scenario of governance gone wrong:

The CIO commissions the IT group to create and implement a governance model & document to manage all IT projects. This governance document is developed as a closed system with little input from the rest of the organization. The model is put into practice and is now ‘law’ within the organization.

Based on the governance model, all new projects over $25,000 must go through the governance process. Why $25K? Very few projects can be completed for less than that…and those that fall under $25K aren’t really that important right?

So…the HR team is ready to implement a new system. They come to IT and ask for some assistance and are told that the project will undoubtedly be over $25K and must go into the governance process and be subject to ‘proper’ project and portfolio management practices.

The HR team are good corporate citizens and begin the governance process. They fill out the paperwork. Determine an estimated cost for the project (and it is over $25K) and wait for the governance process to kick in. And they wait.

A month after submitting the paperwork, a meeting is held to prioritize the projects within the organization. The HR team doesn’t get to attend this meeting…they have to rely on the IT team and submitted paperwork to make their case.

The project is deemed a lower priority than others and not authorized. The HR team is furious. The implementation of this system is a part of all of their performance goals for the year and it has to get done.

So….what happens?

You know what happens! The HR Team moves forward anyway. They reach out to vendors and solicit bids for a ‘phased approach’ to the project. Perhaps they look for a SaaS model for the system to save implementation and initial upfront investment.

Jump forward six months.

The HR Team has fully implement a SaaS platform to do what they need to do. The system does not integrate with any other platform within the organization (perhaps it can, it just hasn’t been integrated). The HR Team is happy as they’ve met the need of their team and reached their goals.

The IT team is not happy. They’ve now got another system in the mix and have to decide whether they support it or not. The CIO isn’t happy because the governance model has proven ineffective. The CIO takes the issue to the CEO and is told to support the platform…the HR team is ‘getting things done’ and the IT team better get on the ball or ‘heads will roll’.

THE PROJECT FAILURES ANALYSIS

The situation described in Eric's blog demonstrates three distinct problems:

1. Creating governance without user engagement. This is the Cardinal Sin. It's completely lame to not bring users into the fold when specifying rules, regulations, policies, orders, demands, mandated-sequential-small-steps-that-are-actually-big-policy-changes, and so on. Compliance requires buy-in and that means soliciting end-user opinions.

2. Ignoring technology realities. Users are aware that software as a service (SaaS) is real and often inexpensive. In 2010, it makes no sense for IT to pretend that lines of business are unable to purchase their own systems.

3. Demonstrating poor judgment. The first two points don't really reflect bad governance so much as lousy decision making.

CIO blogger, Peter Kretzman, makes similar points in a comment to the post:

Governance isn't something that IT can or should dream up and implement unilaterally: it involves the senior management team, as a group, sitting around a table originally and everyone nodding their heads that they all can and will adhere to this process, in order to achieve the benefits. If you don't have that high-level buy-in, don't even bother talking about instituting governance, because it will lead to the kinds of fiasco that you describe.

The involvement of key business stakeholders in the governance body is critical. Someone not directly in IT should be fighting for that HR system, in other words, in the meeting. That doesn't mean, of course, that the answer will be yes, because the organization as a whole may indeed have higher priorities and there are limited resources as always. It should mean, though, that if the answer is no, the answer is no, and it's not a ticket to go out and build things on HR's own.

My take. As is usually the case, successful IT is not about technology, bits, or bytes. Managing and coordinating across departments and other information silos or boundaries is the key to successful IT governance. It's also the critical step in preventing IT failure.

[Image via iStockPhoto.]

Topic: CXO

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10 comments
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  • Slight reshaping of your first point

    [i]"1. Creating governance without user engagement. This
    is the Cardinal Sin. It?s completely lame to not bring users
    into the fold when specifying rules, regulations, policies,
    orders, demands, mandated-sequential-small-steps-that-
    are-actually-big-policy-changes, and so on. Compliance
    requires buy-in and that means soliciting end-user
    opinions."[/i]

    It's not just a matter of involving users when governance is
    defined and put into place. It's critical to have [b]business
    stakeholders outside of IT be actively involved in the
    meetings of the ongoing governance body, particularly
    when it comes to prioritization and project selection.[/b]

    One sure path to failure (in the organizational, political
    sense) is having IT alone decide what they're going to work
    on. These decisions are cross-functional by their very
    essence, not to mention controversial, so everyone has to
    drink the koolaid together, accepting that there are limits
    on what can be taken on and accomplished.

    Peter Kretzman
    http://www.peterkretzman.com
    Peter Kretzman
  • RE: Information silos and IT governance failure

    Perhaps the reason that the project failed was that it wasn't important to the business in the first place?

    Far too many IT departments think that nothing can be done unless they are in control. Support is always the reason, although the central IT department is always looking for reasons to NOT support something. Usually this is either a fake argument to increase their budget, or just plain old laziness.

    This is why the Chinese are kicking US butt!
    tburzio
    • Chinese and IT?

      Somehow, the connection between IT governance and US / Chinese relations isn't clear. Care to explain that one?
      mkrigsman@...
  • RE: Information silos and IT governance failure

    Hi - This has minor flaws but thanks for raising it. Please keep the dialogue going. Recall, governance is fundementally a social activity. Command and control are wrong. Mashups and the IT's 'long tail' need governance too. This is the theme of the EMU Summit in SF 12 March. http://emusummit.com/ -j
    jheuristic
  • RE: Information silos and IT governance failure

    Creating anything without user engagement is usually a big mistake. In software development, this is called going dark. Don't go dark for too long. The corollary in governance is that governance rules need not be set in stone. You need to revisit over time and update your governance rules based on user engagement too.
    gengstrand
  • RE: Information silos and IT governance failure

    Well, the failure was right in the first sentence:

    "The CIO commissions the IT group to create and implement a governance model & document to manage all IT projects. "

    Where was HR at that stage? Where was the business silo? The exclusion of other departments was right there. You don't commission the IT department to do this. You commission a cross-department group to do this. You have a couple from IT. You have a few from HR, you have a few from finance, etc, etc.

    Sticking it with one department, then relying on them to be able to coordinate with other groups is more than a bit naive. This should never have been shoved onto a single department to start with.

    The CIO is the one who blew this. By not including those groups specifically in the initial governance group, he pretty much insured that this would not have the push it needed at the highest levels.
    rijrunner
  • Seen this way too often...

    Wow, did this hit home.

    <em>The HR Team has fully implement a SaaS platform to do what they need to do. The system does not integrate with any other platform within the organization (perhaps it can, it just hasn?t been integrated). The HR Team is happy as they?ve met the need of their team and reached their goals.

    The IT team is not happy. They?ve now got another system in the mix and have to decide whether they support it or not. The CIO isn?t happy because the governance model has proven ineffective. The CIO takes the issue to the CEO and is told to support the platform?the HR team is ?getting things done? and the IT team better get on the ball or ?heads will roll?.</em>

    Sounds very much like the "us vs. them" mentality that lamentably exists in many organizations. The lack of integration among the parties forces some to go off in their own directions, at the expense of the entire organization.

    It's stuff like this that makes me cringe...

    ps
    phil_simon
  • RE: Information silos and IT governance failure

    The truth be told IT governance is really about business governance. In your scenario, the key part which is lost is the business benefits realized from that SAAS implementation. Let me step back a bit, the goals of the organization should have had an IT and HR components to achieve some benefit which necessitated the new system. As an enabling partner of the business, we in IT need to focus upon realizing the business benefits. The tool we often use to accomplish this realization is to collaboratively establish an IT governance process or bolt on an IT planning process to the organization?s budgeting process. You are both exactly right, the process and policy should be adopted by all, not just IT and finance. The process needs to be focused upon realizing business strategy through new services or growing market share. Having a process which is not focused upon business benefits, will be a contributing factor to project failure.

    Elyse
    My PM Blog, http://www.anticlue.net
    Anticlue@...
    • Business Value

      Great comment. IT and their CIO's need to be using business value as the reason for their existence. IT is truly an enabler to the business and as such should be viewed as a profit center, not a cost center as in years past.

      Chris
      http://electustechnology.com/pmblog/
      cscott4@...
  • Data silos out of necessity and by design

    When a company makes its bread and butter from booking camping reservations wins a contract to start tracking accident and error reports for a state highway, they can afford neither the time nor cost of that "big picture" approach of IT Governance toward a unified system vision. It would not even make sense. They must get supporting software and database up next month and hire staff to begin honoring its contract and must often make use of a pre-built COTs which may not even fit some larger vision of a unified system. If anything, IT Governance processes and mandates will put them at risk. That is the reality of the world- a fast moving world.<br>IT Governance is useful in preventing unnecessary IT procurement but should not be mistaken for much else, certainly not in preventing silos.<br>Mitigating silos is more the outcome of agreeing to standards and common database objects, platforms, and interfaces, than a committee, process, or project. Such is why most IT governance initiatives produce nothing more than paper and meetings than value and eventually fade into dusty memory.
    J_k_smith