4 ways for CIOs to get IT governance right in an Agile world
IT governance has always been a tricky organizational discipline to get right, and increasing use of Agile practices has raised new challenges for managers accustomed to traditional IT governance norms.
IT governance defines, prioritizes, aligns, integrates, and controls IT investments and activities to deliver technology-enabled business value. Traditionally, IT governance has relied upon command and control structures to govern IT, but the rise of Agile practices has created tension with traditional practices.
Let’s face it. Investors and managers want to be certain that their investments will pay off, and they have learned to rely upon project-oriented methods to prove in advance how results will be delivered. Project-oriented methods start with high-level business cases and scope statements but very quickly dive into the details of schedule, cost, and specifications – all up front. Providing the details at the start of the project gives investors and managers confidence that teams are going to deliver the right thing, and that investments are focused on the right work.
Traditional IT governance leads to high IT project failure rates
But these traditional methods aren’t without their faults. For decades, reports of high IT project failure rates filled the project management community, and those statistics are still fairly high. The Project Management Institute’s Pulse of the Profession 2021 Report indicated that of IT projects:
- 25% didn’t meet goals
- 36% overran budget
- 41% overran schedule
- 33% lost budget
- 33% suffered from scope creep
- 11% were considered failures
While these statistics are improvements over historical reports, they still point to enormous risk and beg the question: Is traditional IT governance really working?
Agile principles outlined in the Agile manifesto emphasize delivery over planning and documentation. It’s not to say that planning and documentation don’t exist; rather, Agile looks to Agile ceremonies that do just-in-time planning, which promotes flexibility and adaptive solutioning. Governing bodies can find that with Agile teams, the information they relied upon to budget and commit resources isn’t available up front. Given the IT project failure rates cited earlier, governing groups may be more reluctant to adopt and trust Agile delivery when even with the best laid plans, projects were underperforming.
Here are four changes that can better align IT governance with an ever-growing Agile world—and help you achieve speed-to-mission.
1. Create product and service budgets
Shifting to a product and service mindset can help governance groups focus investment discussions on mission enablement through specific product portfolios or individual products and services. This approach helps CIOs tie strategic platforms such as Salesforce, ServiceNow, and Appian to in-demand business capabilities. Money is allocated to process a backlog of prioritized product features and functions. It then falls to the product owner to work with the delivery team(s) to maximize how many backlog items are delivered. The Scaled Agile Framework (SAFe) calls this investment approach lean budgets. By allocating fixed funding increments to value streams (which can be product-oriented), governing boards can limit financial risk while also guaranteeing value delivery due to the short delivery timeframes typical of Agile.
2. Empower the product owner
The product owner plays a key role in Agile delivery. This role serves as an expert in business needs and priorities tied to the product and acts as the principal guide to delivery teams as they process the backlog of prioritized business needs. Business and technology leaders must ensure that qualified and empowered product owners are established. Product owners ensure that the right work gets done, and the work is done right. When Agile teams are led by an engaged product owner, agencies can:
- manage business expectations more effectively because of close integration
- deliver high-value items sooner due to shorter, time-boxed delivery windows
- improve customer satisfaction and trust in IT due to the faster and more frequent delivery of high-value products and services
IT governance teams may lose up-front plans, but the results generated by experienced Agile teams continue to make up for the lack of a comprehensive plan.
3. Adopt lean measurement practices to tune delivery and set expectations
Traditional project management practices have always introduced drag on delivery teams. Documentation, schedules, status reporting, risk management, and other practices all draw the delivery team away from delivering value. Those unaccustomed to Agile and lean practices may wonder how they will know if value is being delivered efficiently by teams if they let go of the tools they rely upon today. Agile tools and practices have devised ways of working that capture delivery statistics and management information in a way that is integrated with what the developer does. Backlog item estimates are generated and refined during established Agile ceremonies, and actual effort and estimate to complete information is updated daily.
4. Use metrics that bridge traditional and Agile practices
Adopting and governing Agile IT doesn’t happen overnight. IT governance teams need metrics that provide them with an equivalent understanding of investment health, whether project-oriented, product-oriented, waterfall, or Agile. Managers have mapped Earned Value Management (EVM) metrics to capture equivalent information across Agile and traditional practices. IT oversight groups and roles can gain a view of earned value, cost performance, schedule performance, and estimate at complete, which serve as basic guideposts for delivery oversight. Using this approach helps oversight roles see progress in a common way, but it can also go a long way to help CIOs demonstrate where Agile practices and teams are making meaningful contributions and outperforming traditional methods.
Remember that culture eats strategy
There are many ways to solve a problem, and the IT governance problem is no different. However, if the culture of the organization is slow or resistant to change , your efforts won’t go far. Tapping into the motivations for change is essential to making this shift. CIOs need to communicate the value of Agile to delivery teams, operations teams, managers, executives, and customers. Focus Agile in limited product sets or services to demonstrate success and build experience, then scale and communicate Agile contribution. Doing so will serve as an important tool to get governance stakeholders on board with making the shift.
