Service-Oriented Architecture Governance for the Services Driven Enterprise

1.7. INFORMATION TECHNOLOGY GOVERNANCE

But how did IT governance become so popular? IT governance is not that different from corporate governance. IT governance is the process of ensuring all IT stakeholders' best interests are being met in the planning, funding, and execution of IT for a given organization. IT governance became important when IT spending ballooned out of control in the late 1990s with the combined hype of Year 2000 and the rise of the Internet.^[] As IT spending got more and more out of control with little return on the investment, business leaders realized little to no impact on their business operations. In fact, in many cases, business leaders did not have much say on how IT spending was managed or how IT dollars were allocated to various initiatives. This lack of input and transparency led to an IT backlash, where many CIOs were reined in, fired, or placed under the oversight of the finance functions. The major change resulting from all of this was the establishment of an IT governance process, where the roles, responsibilities, and decision-making processes of IT planning, funding, and execution were managed by joint business and IT leaders, many times with business leaders having much more influence over IT decisions. Much like the rise of corporate governance, IT governance helped make IT spending and decision-making processes more aligned with the business and corporate stakeholders of the organization.

^[] See Eric Marks, Business Darwinism—Evolve or Dissolve: ...