IT governance: Do you need it?

BANGALORE, INDIA: Independent management consulting firm, Quint has aggressive plans for India. A provider of services in IT strategy and governance, service management and sourcing, Quint feels that Indian companies are now ready to adopt governance strategies for IT in a big way. 

Operating in India for last six years, Quint has four offices based across India. Sunil Mehta, Country manager (India), Quint, discusses the purpose, objectives and benefits of establishing an IT governance strategy across the organization in an interview with CIOL. Excerpts:

CIOL: Are ITSM and Governance two sides of the same coin? What are the key differentiating factors?



Sunil Mehta: As an organization whether you would do all the services yourself or outsource it, which means internal IT should be geared up to handle it. That is the area service management more effective. Anything to do with process improvement. 

From a strategy perspective; it is long term planning, control, security, more focused on control where as service management (SM) is at a lower level, more in terms of converting the long term strategy to short term executable plans. SM covers operations and Strategy covers the highest level: CTO, CEO, director. SM is meant for the operational and tactical level. There are there layers: the tactical layer, strategy and lower is the operational layer.

Quint works on all layers. In each of these three service lines. There are three things we do, education, how to set standards , how to implement and then consulting and benchmarking. We compare how their systems and procedures compared to the others in the same industry. There are two measures, one is against the standards and the other comparing data. We have executed more than 250 implementations so we have developed own best practices in each vertical.

CIOL: How does governance help in the context of outsourcing infrastructure management?



SM: Organisations feel the need to outsource IT to external vendors, that’s where sourcing comes in. To understand what customers want and how to outsource as per the requirement.

In 2005/06 most of the companies wanted to do IT on their own. Then we realized people are getting hassled by managing IT, which is not their core competence. They wanted to outsource it. In the initial days they were very scared to outsource, partially or fully. But what we must realize is that you cannot outsource if your house is not in order. Yet, if you outsource and cannot manage the outsourcing vendor, then its trouble.

It does not make sense if internal procedures and processes are not in place to control the external vendor. Before outsourcing, you must have internal procedures, for example, ITIL. After that, sourcing is important in a way to control not only partners(vendors) but also people both internal and external, procedures, both internal and external and to control technologies. To control them you need a higher level of planning, control and governance. That’s when we move into strategy. Many companies do not have a plan of what they want to achieve in the next three to five years. They have only short term IT strategy, not long term.

It is in their minds, for the benefit of the business they have to make long term strategies, but they have constraints, such as knowledge or vision. Most people don’t think long term, simply because they change jobs so often. So attrition is one reason they don’t think long term. So, what we are trying to do is, assessment, go inside the organisation and check for long term plans. If yes, then are they in line with what they want to do, sometimes its quite narrow, not a long term vision.

We talk to two sets of people, the CEO for business issues and the IT teams. Whether want to introduce new products, new services; how is change management being used to address changing business needs. Change management is covered in all areas, and is one of the most critical success factors. The company’s ability to adapt to change in terms of mindset and time taken to make the change possible.

CIOL: What are the drivers behind a successful governance model??



SM: Firstly, people related change; people have to change. If the people involved are not convinced it will not work. Then there is the technology angle; both have to tie up to make the change possible. The product angle and the partner angle.

The second success factor; the ability to make long term plans, a vision.

And third, the adaptability to make the whole thing possible. 

CIOL: How do you help organizations align IT to their businesses?



SM: We have a concept called BITA or Business IT Alignment concept, which means the business decides the change. How fast IT is able to deliver. There are some best practices. We see if IT is talking well to business. We act like an interface and give a picture or create a common lang which both can understand. By creating procedure and processes to make sure that they communicate with each other and use a language common to each other. The problem is that they (IT) becomes very operational; they never get to the strategy level.

CIOL: What are your plans for the Indian market?

SM: We are looking at tier-1 companies (above $500 million revenue), medium and large enterprise. Others have not reached a level for these interfaces. BFSI, service providers, manufacturing companies are catching up fast because now, most of the manufacturing is automated. So, there is more dependency on hardware and software. So, processes have to be mature and streamlined.

CIOL: How does CoBIT help in the whole governance gamut?



SM: CoBIT is just a set of control s or 34 processes. It is at a higher level: strategy level and long term planning. You can also control the quality of the vendors and people and have quality checks of your vendors. We conduct workshops on why and how and what needs to be done and then we execute projects. 

We also do an assessment to check where the organization was earlier, where it is now and where it wants to be; that kind of benchmarking. We can do end-to-end management.

CIOL: Do companies need to have certain standards in place before opting for CoBIT?

SM: Yes, companies should at least be at the ITIL level. The operational level has to be strong. It cannot be too immature for governance.

CIOL: What is your go to market strategy?

SM: The only missing link was the high end strategy. By end 2008, we will launch CoBIT in India. We are launching all three levels; we are starting with training, IT governance strategy training, consulting, benchmarking and assessment.  We will probably start next month. We have our own existing 220 customers in India both local and global. Everybody has governance in their minds, but they are not sure when to do it. Most of them are engaged into service management. So it’s a matter of time before they will move to governance.

CIOL: How many of your customers do expect will sign up?



SM: We expect about fifteen of our customers to sign up next month. 

CIOL: What is the business model that you work on?



SM: The business model is to co-create. It assures the customer that what we are doing is transparent to them. We create two teams: our team and the customer’s team and work together on the project. We take them through the journey. It is more of an Indian model because the company is comfortable working with us. It is a very good engagement model for us because after that they would do it on their own.

The other engagement is performance based projects, committing performance will improve, we get paid only if performance objectives are met. Most of our projects are performance based. Every project has a performance element. 

CIOL: How long will it take to establish the whole process?

SM: Governance take typically between two months to seven or eight months, an average of six months, including everything. 

CIOL: How do you help in sourcing?



SM: Sourcing strategy: supply side and demand side. Supply side outsourcing is different from demand side. There are two types of organisations; some which are not capable of doing anything on their own, while some keep some work and outsource some work. We do the transition so that the quality of the service improves.

CIOL: Do you find more Indian companies opting to outsource IT to third parties? What are the drivers?

SM: Earlier, most European companies wanted to outsource, but sooner or later we realized so many opportunities in India. Domestic outsourcing has become much bigger now. The volume as well as value has gone up drastically in last three to four years. So our focus is completely domestic. 

With Indian companies the importance given to procedures and processes are not very high. Most companies do not have a long term plan and refrained from spending money because they were not aware. Now people are more open. Earlier, they were scared of losing their jobs, if they asked for guidance. That has changed.

Some restraints are that they do not want to spend money on best practices, they think it is simple and want to try on their own. But, now the mindset has changed and pockets are deeper.