IT governance implementation framework for South African companies: a corporate governance perspective.

Abstract

In the past, information technology (IT) management and governance was a departmental or management level responsibility. However, of recent, it has become an integral part of organisations and its optimal function has also become critical for the attainment of organisational strategic objectives. Organisations continuous investment in and dependency on IT has increased their risk exposure and thus necessitated the need for IT oversight. This need for oversight has prompted the incorporation of IT governance into corporate governance practices and codes. It has also prompted the elevation of IT governance to the highest level of control and leadership of the organisation which is the board. The objective of this study was to establish how JSE listed companies govern IT at the board level. A conceptual board level IT governance framework was derived through a combined review of governance models, corporate governance codes, and IT governance frameworks. The framework was tested using qualitative and quantitative data obtained through semistructured interviews and a survey respectively. The combined qualitative, quantitative and literature findings were analysed to achieve triangulation. The resultant findings indicated the following: an organisation with a well-developed IT governance framework positively improves its board level IT governance effectiveness; board level IT governance effectiveness is improved where IT leadership is engaged with the board; and effective board level IT governance oversight improves overall organisational performance. The unique contribution of this study is that it presents a corporate governance perspective to IT governance at the board level. It provides boards with factors on which to focus to improve their IT governance oversight effectiveness. The study found that IT governance oversight effectiveness is improved if the board focuses on decision making rather than technical and managerial IT-related matters. In addition, the study found that overall organisational performance is influenced by the organisation’s board level IT governance effectiveness. It is recommended that boards of organisations understand the broad domains of IT governance and the impact thereof on business operations, using platforms like board orientation and directorship programmes and courses where applicable. A sample questionnaire developed to guide the board on what aspects of IT governance issues to focus on is proposed and recommended.