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Allocating Decision Rights

Allocating Decision Rights. Acuan : Weill, P. and Ross, J.W. 2004 . IT Governance Archetypes. Business Monarchy. Group of executives make decisions Input comes from different sources: CIO’s direct reports IT leaders from business units Enterprisewide IT budget management process

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Allocating Decision Rights

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  1. Allocating Decision Rights Acuan: Weill, P. and Ross, J.W. 2004

  2. IT Governance Archetypes

  3. Business Monarchy • Group of executives make decisions • Input comes from different sources: • CIO’s direct reports • IT leaders from business units • Enterprisewide IT budget management process • Service-level agreement and chargeback • Activity-tracking system showing all IT resources and how they are deployed

  4. IT Monarchy • IT profesionals make IT decisions • Example: • UPS: IT Governance committee, consist of senior IT managers • State Street: Office of IT Architecture • Dupont: enterprise IT architecture group

  5. Feudal • Each business unit, region or function make IT decisions • Does not facilitate enterprisewide decision making • Not common because there is no synergy between business units

  6. Federal • Coordinated decision making involving both center and business units • Unit representatives: unit leaders/business process owners, business unit,IT leaders as additional participants. • Most difficult archetypes for decision making • Biggest, most powerful business units get most attention and have most influence

  7. IT Duopoly • Two-party arrangement: IT executives and one other group • IT executives: central IT group or a team of central and business unit IT organization • Other group: CxOs, business unit leaders.

  8. Forms of IT Duopoly • Bicycle wheel • Describes duopoly involving central IT group and business units • IT group at the hub and business units are around the rim • Each business unit get individual attention but the same hub support the whole enterprise

  9. Forms of IT Duopoly (cont.) • T-shape • Describes duopoly involving central IT group and senior management team • Implemented by two overlapping committees • The executive committee (horizontal part) comprises business managers • IT committee (vertical part) comprises technical managers

  10. Forms of IT Duopoly (cont.) • T-shape (cont.) • Used for three less-technical IT decision domains: IT principles, business application needs, and IT investment. • Frequently used to provide input for architecture and infrastructure domains. • Popular because involve only two decision-making parties.

  11. Anarchy • Individuals and small groups make their own decisions based only on their local needs.

  12. How Enterprise Governs IT

  13. IT Principles • Duopoly approach: T-shaped duopoly • Business and IT monarchy • Federal

  14. IT Architecture • IT monarchy : senior managers view architecture more as technical than strategic issues • Duopoly : T-shaped

  15. IT Infrastructure • IT monarchy • Duopoly

  16. IT Business application needs • Federal • IT Duopoly • Feudal

  17. IT Investment and Priorization • Monarchy • Federal • Duopoly : T-shaped

  18. Factors of Variations • Strategic and performance goals • Organizational structures • Governance experience • Size and diversity • Industry and regional differences

  19. Case study: DuPont

  20. Case study: DBS Bank

  21. Case study: Motorola

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