Developing guiding principles

How do senior managers ensure that IT investment decisions are in line with the organization’s long-term strategy? The answer may be to develop a set of guiding principles which govern IT investment decisions.

The ‘principles’ approach to IT is advocated by Davenport. He recommends that a task force is set up comprising from 5 to 10 senior managers, including a senior information systems person, together with a small group of IS managers. This group should begin to devise a set of guiding principles that link strategy to IT investment decisions. The senior managers act as sponsors later in the process, endorsing the principles devised by the group.

The IS managers create the initial set of principles which convey the basic attitudes of the company towards technology, the overall direction the business is taking and the use to be made of existing technologies. These principles should be good for two or three years, or until there is a major shift in strategy. They should cover infrastructure, applications, data and organization. Examples of such principles are given by Davenport:

On infrastructure: We are committed to a single vendor environment.

On applications: IS will provide applications that support cross-functional integration of business processes.

On data: Data created or obtained within the company belongs to the corporation – not to any particular function, unit, or individual. It is available to any user in the company who can demonstrate a need for it.

On organization: The user-sponsor of a systems project will be responsible for the business success of the system.

Once this amount of time and effort is spent aligning the thinking between senior business managers and IT managers, the strategic course for IT progress is set, and decision making becomes much easier.