The institution clearly defines its own concept of value and the management practices devoted to generating the results expected from ICT-related investments (in ICT-enabled initiatives, services and assets) throughout their economic life cycle.
This involves defining the value of the outcomes to be achieved, analysing the cost-result of ICT investments and evaluating the return on investment of ICT-related initiatives.
Guideline code
ICT_01100
Mechanism
Mechanism
- The management, with the assistance of the ICT, financial and other specialized units, should define the concept of value as well as the management principles and practices to enable optimal value realization from ICT-related investments throughout their economic life cycle.
- The ICT and specialized units should continually evaluate the portfolio of ICT-enabled investments, services and assets to determine the likelihood of achieving institutional objectives at a reasonable cost. This involves:
- Understanding stakeholder requirements – strategic ICT issues as well as capabilities regarding the actual and potential significance of ICT for the institution’s strategy;
- Understanding what constitutes value for the institution, and considering how well it is communicated, understood and applied throughout the institution’s processes;
- Evaluating how effectively the institution and ICT strategies have been integrated and aligned within the enterprise and with the institution’s goals for delivering value;
- Evaluating the portfolio of investments, services and assets for alignment with the institution’s strategic objectives, taking into account: risk evaluation; business process alignment; effectiveness in terms of usability, availability and responsiveness; and efficiency in terms of cost, redundancy and technical health.
- The ICT and specialized units should direct value management principles and practices to enable optimal value realization from ICT-enabled investments. This involves:
- Defining and communicating portfolio and investment categories;
- Directing the management to consider potential innovative uses of ICT that would enable the institution to respond to new opportunities or challenges.
- The board should communicate the institutional scope of the definition of value, and the principles to enable value realization, throughout the institution.
Parent
Structure
Structure
- The board should commission the management and the ICT unit to establish the institution’s concept of value as well as approaches and practices to optimize its realization.
- A specialized organizational structure, reporting to the management and the ICT management, should be established to manage the institution’s ICT-related values. To establish accountability, the roles and responsibilities of the units within that structure have to be well defined and documented.
- The management processes of ICT-related values should follow the adopted ICT governance principles and ICT strategies, and be based on international standards and practices (e.g. COBIT®).
Title HTML
Guideline 7. Defining concept of value and approaches to optimize its realization
Type
Guideline_1
Weight
14