How to Identify and Measure the Level of Alignment between IT and Business Governance

Studies have shown that misalignment, or the lack of alignment, between IT and business strategies is one of the main reasons why enterprises fail to realize the full potential of their IT investments. Within enterprise governance, the alignment analysis between IT and Business governance is becoming more important in achieving the organization’s goals by adding value while balancing risk versus return over IT and its processes. IT governance is integral to the success of business governance by assuring efficient and effective measurable improvements. In order to identify and measure the level of alignment between IT and Business Governance it is proposed in this article, the correlation between the Business Balanced Scorecard and the IT Balanced Scorecard. Moreover, it is presented a theoretical example of the scenario-based analysis technique (Process Simulation) to correlate a set of Key Performance Indicators of IT Processes (IT Services) with a set of Key Performance Indicators (KPI) of Business Processes. These interactions and correlations between KPI over time can result in a large number of scenarios, which at the same time will assure a solid base for a bottom up analysis of IT and Business Governance level of alignment. This paper presents preliminary research conclusions on how to identify and measure the level of alignment between IT and Business Governance by means of correlating IT and Business Processes KPI and assessing the possible and needed scenarios, applying process simulation.