You've invested heavily in technology, but where is the payoff? This excerpt from IT Governance, a new book published by HBS Press, distills keys to creating greater value from IT.

From studying and working with hundreds of enterprises, we have distilled the lessons from many outstanding leaders into ten principles of IT governance. We intend these principles to provide leaders with a succinct summary to use as a primer, refresher, or checklist as they refine their IT governance.

1. Actively design governance
Many enterprises have created disparate IT governance mechanisms. These uncoordinated mechanism "silos" result from governance by default—introducing mechanisms one at a time to address a particular need (for example, architecture problems or overspending or duplication). Patching up problems as they arise is a defensive tactic that limits opportunities for strategic impact from IT. Instead, management should actively design IT governance around the enterprise's objectives and performance goals.

From studying and working with hundreds of enterprises, we have distilled the lessons from many outstanding leaders into ten principles of IT governance. We intend these principles to provide leaders with a succinct summary to use as a primer, refresher, or checklist as they refine their IT governance.

1. Actively design governance
Many enterprises have created disparate IT governance mechanisms. These uncoordinated mechanism "silos" result from governance by default—introducing mechanisms one at a time to address a particular need (for example, architecture problems or overspending or duplication). Patching up problems as they arise is a defensive tactic that limits opportunities for strategic impact from IT. Instead, management should actively design IT governance around the enterprise's objectives and performance goals.

Actively designing governance involves senior executives taking the lead and allocating resources, attention, and support to the process. For some enterprises, this will be the first time IT governance is explicitly designed. Often there are mature business governance processes to use as a starting point. For example, the Tennessee Valley Authority piggybacked its IT governance on its more mature business governance mechanisms, such as its capital investment process. TVA's IT governance included a project review committee, benchmarking, and selective chargeback—all familiar mechanisms from the engineering side of the business.

Not only does overall governance require active design, but each mechanism also needs regular review. Focus on having the fewest number of effective mechanisms possible. Many of the enterprises we studied had as many as fifteen different governance mechanisms, all varying in effectiveness. Fifteen mechanisms may possibly be needed but it's highly unlikely. All fifteen will certainly not be very effective, integrated, and well understood. Many enterprises with effective IT governance have between six and ten integrated and well-functioning mechanisms. One goal of any governance redesign should be to assess, improve, and then consolidate the number of mechanisms. Early in the learning cycle, mechanisms may involve large numbers of managers. Typically, as senior managers better understand IT value and the role of IT, a smaller set of managers can represent enterprise needs.

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