Improve Your IT Recruitment Process

Train your IT department to get involved in the recruitment process to attract and select the best talent.

Own the IT recruitment process

Train your IT department to get involved in the recruitment process to attract and select the best talent.

Follow this blueprint to:

• Define and communicate the unique benefits of working for your organization to potential candidates through a strong employer brand.
• Learn best practices around creating effective job postings.
• Target your job posting efforts on the areas with the greatest ROI.
• Create and deliver an effective, seamless, and positive interview and offer process for candidates.
• Acclimate new hires and set them up for success.

Get involved at key moments of the candidate experience to have the biggest impact

RECRUIT QUALITY STAFF

Hiring talent is critical to organizational success

Talent is a priority for the entire organization:

Respondents rated “recruitment” as the top issue facing organizations today (McLean & Company 2022 HR Trends Report).

37% of IT departments are outsourcing roles to fill internal skill shortages (Info-Tech Talent Trends 2022 Survey).

Yet bad hires are alarmingly common:

Hiring is one of the least successful business processes, with three-quarters of managers reporting that they have made a bad hire (Robert Half, 2021).

48% of survey respondents stated improving the quality of hires was the top recruiting priority for 2021 (Jobvite, 2021).

Workshop overview

Enhance Your Recruitment Strategies

The way you position the organization impacts who is likely to apply to posted positions.

Develop a strong employee value proposition

What is an employee value proposition?

And what are the key components?

The employee value proposition is your opportunity to showcase the unique benefits and opportunities of working at your organization, allowing you to attract a wider pool of candidates.

Creating a compelling EVP that presents a picture of your employee experience, with a focus on diversity, will attract a wide pool of diverse candidates to your team. This can lead to many internal and external benefits for your organization.

How to collect information on your EVP

Existing Employee Value Proposition: If your organization or IT department has an existing employee value proposition, rather than starting from scratch, we recommend leveraging that and moving to the testing phase to see if the EVP still resonates with staff and external parties.

Employee Engagement Results: If your organization does an employee engagement survey, review the results to identify the areas in which the IT organization is performing well. Identify and document any key comment themes in the report around why employees enjoy working for the organization or what makes your IT department a great place to work.

Social Media Sites. Prepare for the good, the bad, and the ugly. Social media websites like Glassdoor and Indeed make it easier for employees to share their experiences at an organization honestly and candidly. While postings on these sites won’t relate exclusively to the IT department, they do invite participants to identify their department in the organization. You can search these to identify any positive things people are saying about working for the organization and potentially opportunities for improvement (which you can use as a starting point in the retention section of this report).

1.1 Gather feedback

1. Download the Improve Your IT Recruitment Workbook.
2. On tab 1.1, brainstorm the top five things you value most about working at the organization. Ask yourself what would fall in each category and identify any key themes. Be sure to take note of any specific quotes you have.
3. Brainstorm limitations that the organization currently has in each of those areas.

Download the Recruitment Workbook

1.2 Build key messages

1. Go to tab 1.2 in your workbook
2. Identify themes from activity 1.1 that would be considered current strengths of you organization.
3. Identify themes from activity 1.2 that are aspirational elements of your organization.
4. Identify up to four key statements to focus on for the EVP, ensuring that your EVP speaks to at least one of the five categories above.
5. Integrate these into one overall statement.

Examples below.

Sample EVPs

Sources: Built In, 2021; Workology, 2022

Ensure your EVP resonates with employees and prospects

Test your EVP with internal and external audiences.

Want to learn more?

Recruit IT Talent

• Improve candidate experience to hire top IT talent.

Recruit and Retain More Women in IT

• Gender diversity is directly correlated to IT performance.

Recruit and Retain People of Color in IT

• Good business, not just good philanthropy.

Enhance Your Recruitment Strategies

The way you position the organization impacts who is likely to apply to posted positions.

Market your EVP to potential candidates: Employer Brand

Employer brand includes how you market the EVP internally and externally – consistency is key

The employer brand is the perception internal and external stakeholders hold of the organization and exists whether it has been curated or not. Curating the employer brand involves marketing the organization and employee experience. Grounding your employer brand in your EVP enables you to communicate and market an accurate portrayal of your organization and employee experience and make you desirable to both current and potential employees.

The unique offering an employer provides to employees in return for their effort, motivating them to join or remain at the organization. The perception internal and external stakeholders hold of the organization.

Alignment between the EVP, employer brand, and corporate brand is the ideal branding package. An in-sync marketing strategy ensures stakeholders perceive and experience the brand the same way, creating brand ambassadors.

Ensure your branding material creates a connection

How you present your employer brand is just as important as the content. Ideally, you want the viewer to connect with and personalize the material for the message to have staying power. Use Marketing’s expertise to help craft impactful promotional materials to engage and excite the viewer.

Visuals

Images are often the first thing viewers notice. Use visuals that connect to your employer brand to engage the viewer’s attention and increase the likelihood that your message will resonate. However, if there are too many visuals this may detract from your content – balance is key!

Language

Wordsmithing is often the most difficult aspect of marketing. Your message should be accurate, informative, and engaging. Work with Marketing to ensure your wording is clever and succinct – the more concise, the better.

Composition

Integrate visuals and language to complete your marketing package. Ensure that the text and images are balanced to draw in the viewer.

Case Study: Using culture to drive your talent pool

This case study is happening in real time. Please check back to learn more as Goddard continues to recruit for the position.

Recruiting at NASA

Goddard Space Center is the largest of NASA’s space centers with approximately 11,000 employees. It is currently recruiting for a senior technical role for commercial launches. The position requires consulting and working with external partners and vendors.

NASA is a highly desirable employer due to its strong culture of inclusivity, belonging, teamwork, learning, and growth. Its culture is anchored by a compelling vision, “For the betterment of Humankind,” and amplified by a strong leadership team that actively lives their mission and vision daily.

Firsthand lists NASA as #1 on the 50 most prestigious internships for 2022.

Rural location and no flexible work options add to the complexity of recruiting

The position is in a rural area of Eastern Shore Virginia with a population of approximately 60,000 people, which translates to a small pool of candidates. Any hire from outside the area will be expected to relocate as the senior technician must be onsite to support launches twice a month. Financial relocation support is not offered and the position is a two-year assignment with the option of extension that could eventually become permanent.

“Looking for a Talent Unicorn: a qualified, experienced candidate with both leadership skills and deep technical expertise that can grow and learn with emerging technologies.”

Steve Thornton

Acting Division Chief, Solutions Division, Goddard Space Flight Center, NASA

Case Study: Using culture to drive your talent pool

A good brand overcomes challenges.

Culture takes the lead in NASA's job postings, which attract a high number of candidates. Postings begin with a link to a short video on working at NASA, its history, and how it lives its vision. The video highlights NASA's diversity of perspectives, career development, and learning opportunities.

NASA's company brand and employer brand are tightly intertwined, providing a consistent view of the organization.

The employer vision is presented in the best place to reach NASA's ideal candidate: usajobs.gov, the official website of the United States Government and the “go-to” for government job listings. NASA also extends its postings to other generic job sites as well as LinkedIn and professional associations.

Interview with Robert Leahy

Chief Information Officer, Goddard Space Flight Center, NASA

2.1 Assess your organization’s employer brand

1. Go to tab 2.1 in the Improve Your IT Recruitment Workbook.
2. Put yourself in the shoes of someone on the outside looking in. If they were to look up your organization, what impression would they be given about what is like to work there?
3. Run a Google search on your organization with key words “jobs,” “culture,” and “working environment” to see what a potential candidate would see when they begin researching your organization.

You can use sites like:

• Glassdoor
• Indeed company pages
• LinkedIn company pages
• Social media
• Your own website

Want to learn more?

Recruit IT Talent

• Improve candidate experience to hire top IT talent.

Recruit and Retain More Women in IT

• Gender diversity is directly correlated to IT performance.

Recruit and Retain People of Color in IT

• Good business, not just good philanthropy.

Enhance Your Recruitment Strategies

The way you position the organization impacts who is likely to apply to posted positions.

Create engaging job ads to attract talent to the organization

We have a job description; can I just post that on Indeed?

A job description is an internal document that includes sections such as general job information, major responsibilities, key relationships, qualifications, and competencies. It communicates job expectations to incumbents and key job data to HR programs.

A job ad is an externally facing document that advertises a position with the intent of attracting job applicants. It contains key elements from the job description as well as information on the organization and its EVP.

Write an Effective Job Ad

• Ensure that your job ad speaks to the audience you are targeting through the language you use.
  • E.g. If you are hiring for a creative role, use creative language and formatting. If you are writing for students, emphasize growth opportunities.
• Highlight the organization’s EVP.
• Paint an accurate picture of key aspects of the role but avoid the nitty gritty as it may overwhelm applicants.
• Link to your organization’s website and social media platforms so applicants can easily find more information.

A job description informs a job ad, it doesn’t replace it. Don’t be lulled into using a job description as a posting when there’s a time crunch to fill a position. Refer to job postings as job advertisements to reinforce that their purpose is to attract attention and talent.

An effective job posting contains the following elements:

Bottom Line: A truly successful job posting ferrets out those hidden stars that may be over cautious and filters out hundreds of applications from the woefully under qualified.

The do’s and don’ts of an inclusive job ad

*Source: Ladders, 2013

Before posting the job ad complete the DEI job posting validation checklist

*Source: Recruit and Retain People of Color in IT

3.1 Review and update your job ads

1. Download the Job Ad Template.
2. Look online or ask HR for an example of a current job advertisement you are using.

• If you don’t have one, you can use a job description as a starting point.

Want to learn more?

Recruit IT Talent

• Improve candidate experience to hire top IT talent.

Recruit and Retain More Women in IT

• Gender diversity is directly correlated to IT performance.

Recruit and Retain People of Color in IT

• Good business, not just good philanthropy.

Enhance Your Recruitment Strategies

Focus on key programs and tactics to improve the effectiveness of your sourcing approach.

Get involved with sourcing to get your job ad seen

To meet growing expectations, organizations need to change the way they source

Focus on key programs and tactics to improve the effectiveness of your sourcing approach

Internal Talent Mobility (ITM) Program

Social Media Program

Employee Referral Program

Alumni Program

Campus Recruiting Program

Other Sourcing Tactics

Take advantage of your current talent with an internal talent mobility program

What is it?

Positioning the right talent in the right place, at the right time, for the right reasons, and supporting them appropriately.

Leverage social media to identify and connect with talent

“It is all about how we can get someone’s attention and get them to respond. People are becoming jaded.”

– Katrina Collier, Social Recruiting Expert, The Searchologist

Reap the rewards of an employee referral program

Avoid the Like Me Bias: Continually evaluate the diversity of candidates sourced from the employee referral program. Unless your workforce is already diverse, referrals can hinder diversity because employees tend to recommend people like themselves.

Tap into your network of former employees

Make use of a campus recruiting program

Info-Tech Insight

Target schools that align with your culture and needs. Do not just focus on the most prestigious schools: they are likely more costly, have more intense competition, and may not actually provide the right talent.

Identify opportunities to integrate non-traditional techniques

Partner with other organizational functions to build skills and leverage existing knowledge

Use knowledge that already exists in the organization to improve talent sourcing capabilities.

To successfully partner with other departments in your organization:

• Acknowledge that they are busy. Like IT, they have multiple competing priorities.
• Present your needs and prioritize them. Create a list of what you are looking for and then be willing to just pick your top need. Work with the other department to decide what needs can and cannot be met.
• Present the business case. Emphasize how partnering is mutually beneficial. For example, illustrate to Marketing that promoting a strong brand with candidates will improve the organization’s overall reputation because often, candidates are customers.
• Be reasonable and patient. You are asking for help, so be moderate in your expectations and flexible in working with your partner.

Info-Tech Insight

Encourage your team to seek out, and learn from, employees in different divisions. Training sessions with the teams may not always be possible but one-on-one chats can be just as effective and may be better received.

5.1 Review the effectiveness of existing sourcing programs

1. As a group review the description of each program as defined on previous slides. Ensure that everyone understands the definitions.
2. In your workbook, look for the cell Internal Talent Mobility under the title; you will find five rows with the following

• This program is formally structured and documented.
• This program is consistently applied across the organization.
• Talent is sourced this way on an ad hoc basis.
• Our organization currently does not source talent this way.
• There are metrics in place to assess the effectiveness of this program.

Want to learn more?

Recruit IT Talent

• Improve candidate experience to hire top IT talent.

Recruit and Retain More Women in IT

• Gender diversity is directly correlated to IT performance.

Recruit and Retain People of Color in IT

• Good business, not just good philanthropy.

Enhance Your Recruitment Strategies

Interviews are the most often used yet poorly executed hiring tool.

Create a high-quality interview process to improve candidate assessment

Everyone believes they’re a great interviewer; self-assess your techniques, and “get real” to get better

If you…

• Believe everything the candidate says.
• Ask mostly hypothetical questions: "What would you do in a situation where…"
• Ask gimmicky questions: "If you were a vegetable, what vegetable would you be?"
• Ask only traditional interview questions: "What are your top three strengths?”
• Submit to a first impression bias.
• Have not defined what you are looking for before the interview.
• Ignore your gut feeling in an attempt to be objective.
• Find yourself loving a candidate because they are just like you.
• Use too few or too many interviewers in the process.
• Do not ask questions to determine the motivational fit of the candidate.
• Talk more than the interviewee.
• Only plan and prepare for the interview immediately before it starts.

…then stop. Use this research!

Most interviewers are not effective, resulting in many poor hiring decisions, which is costly and counter-productive

Most interviewers are not effective…

• 82% of organizations don’t believe they hire highly talented people (Trost, 2022).
• Approximately 76% of managers and HR representatives that McLean & Company interviewed agreed that the majority of interviewers are not very effective.
• 66% of hiring managers come to regret their interview-based hiring decisions (DDI, 2021).

…because, although everyone knows interviewing is a priority, most don’t make it one.

• Interviewing is often considered an extra task in addition to an employee’s day-to-day responsibilities, and these other responsibilities take precedence.
• It takes time to effectively design, prepare for, and conduct an interview.
• Employees would rather spend this time on tasks they consider to be an immediate priority.

Even those interviewers who are good at interviewing, may not be good enough.

• Even a good interviewer can be fooled by a great interviewee.
• Some interviewees talk the talk, but don’t walk the walk. They have great interviewing abilities but not the skills required to be successful in the specific position for which they are interviewing.
• Even if the interviewer is well trained and prepared to conduct a strong interview, they can get caught up with an interviewee that seems very impressive on the surface, and end up making a bad hire.

Preparing the Perfect Interview

Step 5: Define decision rights

Establish decision-making authority and veto power to mitigate post-interview conflicts over who has final say over a candidate’s status.

Follow these steps to create a positive interview experience for all involved.

Step 1: Define the ideal candidate profile; determine the attributes of the ideal candidate and their relative importance

Define the attributes of the ideal candidate…

Caution: Evaluating for “organizational or cultural fit” can lead to interviewers falling into the trap of the “like me” bias, and excluding diverse candidates.

…then determine the importance of the attributes.

The job description is not enough; meet with stakeholders to define and come to a consensus on the ideal candidate profile

Definition of the Ideal Candidate

• The Hiring Manager has a plan for the new hire and knows the criteria that will best fulfill that mandate.
• The Executive team may have specific directives for what the ideal candidate should look like, depending on the level and critical nature of the position.
• Industry standards, which are defined by regulatory bodies, are available for some positions. Use these to identify skills and abilities needed for the job.
• Competitor information such as job descriptions and job reviews could provide useful data about a similar role in other organizations.
• Exit interviews can offer insight into the most challenging aspects of the job and identify skills or abilities needed for success.
• Current employees who hold the same or a similar position can explain the nuances of the day-to-day job and what attributes are most needed on the team.

“The hardest work is accurately defining what kind of person is going to best perform this job. What are their virtues? If you’ve all that defined, the rest is not so tough.”

– VP, Financial Services

Use a scorecard to document the ideal candidate profile and help you select a superstar

1. Download the Workbook and go to tab 6.1.
2. Document the desired attributes for each category of assessment: Competencies, Experiences, Fit, and Motivation. You can find an Attribute Library on the next tab.
   
3. Rank each attribute by level of priority: Required, Asset, or Nice-to-Have.
   
4. Identify deal breakers that would automatically disqualify a candidate from moving forward.

To identify questions for screening interviews, use the Screening Interview Template

A screening interview conducted by phone should have a set of common questions to identify qualified candidates for in-person interviews.

The Screening Interview Template will help you develop a screening interview by providing:

• Common screening questions that can be modified based on organizational needs and interview length.
• Establishing an interview team.
• A questionnaire format so that the same questions are asked of all candidates and responses can be recorded.

Once completed, this template will help you or HR staff conduct candidate screening interviews with ease and consistency. Always do screening interviews over the phone or via video to save time and money.

Info-Tech Insight

Determine the goal of the screening interview – do you want to evaluate technical skills, communication skills, attitude, etc.? – and create questions based on this goal. If evaluating technical skill, have someone with technical competency conduct the interview.

Step 2: Choose interview types and techniques that best assess the ideal candidate attributes listed on the position scorecard

There is no best interview type or technique for assessing candidates, but there could be a wrong one depending on the organization and job opening.

• Understanding common interviewing techniques and types will help inform your own interviewing strategy and interview development.
• Each interview technique and type has its own strengths and weakness and can be better suited for a particular organizational environment, type of job, or characteristic being assessed.

No matter which interview types or techniques you use, aim for it to be as structured as possible to increase its validity

The validity of the interview increases as the degree of interview structure increases.

Components of a highly structured interview include:

1. Interview questions are derived from a job analysis (they are job related).
2. Interview questions are standardized (all applicants are asked the same questions).
3. Prompting, follow-up questioning, probing, and/or elaboration on questions are limited. Try to identify all prompts, follow-ups, and probes beforehand and include them in the interview guide so that all candidates get the same level of prompting and probing.
4. Interview questions focus on behaviors or work samples rather than opinions or self-evaluations.
5. Interviewer access to ancillary information (e.g. resumes, letters of reference, test scores, transcripts) is controlled. Sometimes limiting access to these documents can limit interviewer biases.
6. Questions from the candidate are not allowed until after the interview. This allows the interviewer to stay on track and not go off the protocol.
7. Each answer is rated during the interview using a rating scale tailored to the question (this is preferable to rating dimensions at the end of the interview and certainly preferable to just making an overall rating or ranking at the end).
8. Rating scales are “anchored” with behavioral examples to illustrate scale points (e.g. examples of a “1,” “3,” or “5” answer).
9. Total interview score is obtained by summing across scores for each of the questions.

The more of these components your interview has, the more structured it is, and the more valid it will be.

Step 3: Prepare interview questions to assess the attributes you are looking for in a candidate

The purpose of interviewing is to assess, not just listen. Questions are what help you do this.

Preparing questions in advance allows you to:

• Match each question to a position requirement (included in your scorecard) to ensure that you assess all required attributes. Everything assessed should be job relevant!
• Determine each question’s weighting, if applicable.
• Give each candidate a chance to speak to all their job-relevant attributes.
• Keep records should an unselected candidate decide to contest the decision.

If you don’t prepare in advance:

• You’ll be distracted thinking about what you are going to ask next and not be fully listening.
• You likely won’t ask the same questions of all candidates, which impacts the ability to compare across candidates and doesn’t provide a fair process for everyone.
• You likely won’t ask the questions you need to elicit the information needed to make the right decision.
• You could ask illegal questions (see Acquire the Right Hires with Effective Interviewing for a list of questions not to ask in an interview).

Use the Interview Question Planning Guide tab in the Candidate Interview Strategy and Planning Guide to prepare your interview questions.

Use these tips to draft interview questions:

• Use job analysis output, in particular the critical incident technique, to develop structured interview questions.
• Search online or in books for example interview questions for the target position to inform interview question development. Just remember that candidates access these too, so be sure to ask for specific examples, include probing questions, and adapt or modify questions to change them.
• Situational questions: The situation should be described in sufficient detail to allow an applicant to visualize it accurately and be followed by “what would you do?” Scoring anchors should reflect effective, typical, and ineffective behaviors.
• Behavioral questions: Should assess a behavioral dimension (e.g. meeting deadlines) and apply to a variety of situations that share the underlying dimension (e.g. at work or school). Scoring anchors should be applicable to a variety of situations and reflect effective, typical, and ineffective behavior.

Conduct an effective screening interview by listening to non-verbal cues and probing

Follow these steps to conduct an effective screening interview:

When you have a shortlist of candidates to invite to an in-person interview, use the Candidate Communication Template to guide you through proper phone and email communications.

Don’t just prepare top-level interview questions; also prepare probing questions to probe to gain depth and clarity

Use probing to drill down on what candidates say as much as possible and go beyond textbook answers.

Conduct effective interviews and assessments

Mitigate inherent biases of assessors by integrating formal assessments with objective anchors and clear criteria to create a more inclusive process.

Consider leveraging behavioral interview questions in your interview to reduce bias.

• In the past, companies were pushing the boundaries of the conventional interview, using unconventional questions to find top talent, e.g. “what color is your personality?” The logic was that the best people are the ones who don’t necessarily show perfectly on a resume, and they were intent on finding the best.
• However, many companies have stopped using these questions after extensive statistical analysis revealed there was no correlation between candidates’ ability to answer them and their future performance on the job.
• Asking behavioral interview questions based on the competency needs of the role is the best way to uncover if the candidates will be able to execute on the job.

Assessments are created by people that have biases. This often means that assessments can be biased, especially with preferences towards a Western perspective. Even if the same assessments are administered, the questions will be interpreted differently by candidates with varying cultural backgrounds and lived experiences. If assessments do not account for this, it ultimately leads to favoring the answers of certain demographic groups, often ones similar to those who developed the assessment.

Creating an interview question scorecard

Attribute you are evaluating Probing questions prepared Area to take notes

Exact question you will ask Place to record score Anchored scale with definitions of a poor, ok and great answer

Step 4: Assemble an interview team

HR and the direct reporting supervisor should always be part of the interview. Make a good impression with a good interview team.

The must-haves:

• The Future Manager should always be involved in the process. They should be comfortable with the new hire’s competencies and fit.
• Human Resources should always be involved in the process – they maintain consistency, legality, and standardization. It’s their job to know the rules and follow them. HR may coordinate and maintain policy standards and/or join in assessing the candidate.
• There should always be more than just one interviewer, even if it is not at the same time. This helps keep the process objective, allows for different opinions, and gives the interviewee exposure to multiple individuals in the company. But, try to limit the number of panel members to four or less.

“At the end of the day, it’s the supervisor that has to live with the person, so any decision that does not involve the supervisor is a very flawed process.” – VP, Financial Services

The nice-to-haves:

• Future colleagues can offer benefits to both the interviewee and the colleague by:
  • Giving the candidate some insight into what their day-to-day job would be.
  • Relaxing the candidate; allowing for a less formal, less intimidating conversation.
  • Introducing potential teammates for a position that is highly collaborative.
  • Offering the interviewer an excellent professional development opportunity – a chance to present their understanding of what they do.
• Executives should take part in interviewing for executive hiring, individuals that will report to an executive, or for positions that are extremely important. Executive time is scarce and expensive, so only use it when absolutely necessary.

Record the interview team details in the Candidate Interview Strategy and Planning Guide template.

Assign interviewers roles inside and outside the actual interview

Define Interview Process Roles

Who Should… Contact candidates to schedule interviews or communicate decisions?

Who Should… Be responsible for candidate welcomes, walk-outs, and hand-offs between interviews?

Who Should… Define and communicate each stakeholder’s role?

Who Should… Chair the preparation and debrief meetings and play the role of the referee when trying to reach a consensus?

Define Interview Roles

• Set a role for each interviewer so they know what to focus on and where they fit into the process (e.g. Interviewer A will assess fit). Don’t ad hoc the process and allow everyone to interview based on their own ideas.
• Consider interviewer qualifications and the impact of the new employee on each interviewer, when deciding the roles of each interviewer (i.e. who will interview for competency and who will interview for fit).
  • For example, managers may be most impacted by technical competencies and should be the interviewer to evaluate the candidate for technical competency.

“Unless you’ve got roles within the panel really detailed and agreed upon, for example, who is going to take the lead on what area of questions, you end up with a situation where nobody is in charge or accountable for the final interview assessment." – VP, Financial Services

Info-Tech Insight

Try a Two Lens Assessment: One interviewer assesses the candidate as a project leader while another assesses them as a people leader for a question such as “Give me an example of when you exercised your leadership skills with a junior team member.”

Step 5: Set decision rights in stone and communicate them in advance to manage stakeholder expectations and limit conflict

All interviewers must understand their decision-making authority prior to the interview. Misunderstandings can lead to resentment and conflict.

The decisions being made can include whether or not to move a candidate onto the next phase of the hiring process or a final hiring decision. Deciding decision rights in advance defines accountability for an effective interview process.

Create your interview team, assessments, and objective anchor scale

1. Download the Behavioral Interview Question Library as a reference.
2. On tab 9 of your workbook, document all the members of the team and their respective roles in the interview process. Fill in the decision-making authority section to ensure every team member is held accountable to their assigned tasks and understands how their input will be used.
3. For each required attribute in the Ideal Candidate Scorecard, chose one to two questions from the library that can properly evaluate that attribute.
4. Copy and paste the questions and probing questions into the Interview Guide Template.
5. Create an objective anchor scale and clearly define what a poor, ok, and great answer to each question is.

Download the Behavioral Interview Question Library

Conduct an effective, professional, and organized in-person interview

The subsequent slides provide additional detail on these eight steps to conducting an effective interview.

Avoid these common biases and mistakes

Common Biases

Like-me effect: An often-unconscious preference for, and unfairly positive evaluation of, a candidate based on shared interests, personalities, and experiences, etc.

Status effect: Overrating candidates based on the prestige of previously held positions, titles, or schools attended.

Recency bias: Placing greater emphasis on interviews held closer to the decision-making date.

Contrast effect: Rating candidates relative to those who precede or follow them during the interview process, rather than against previously determined data.

Solution

Assess candidates by using existing competency-based criteria.

Common Mistakes

Negative tone: Starting the interview on a negative or stressful note may derail an otherwise promising candidate.

Poor interview management: Letting the candidate digress may leave some questions unanswered and reduce the interview value.

Reliance of first impressions: Basing decisions on first impressions undermines the objectivity of competency-based selection.

Failure to ask probing questions: Accepting general answers without asking follow-up questions reduces the evidentiary value of the interview.

Solution

Follow the structured interview process you designed and practiced.

Ask the questions in the order presented in the interview guide, and probe and clarify as needed

When listening to candidate responses, watch for tone, body language, and red flags

Increase hiring success: Give candidates a positive perception of the organization in the interview

Great candidates want to work at great organizations.

When the interviewer makes a positive impression on a candidate and provides a positive impression of the organization it carries forward after they are hired.

In addition, better candidates can be referred over the course of time due to higher quality networking.

As much as choosing the right candidate is important to you, make sure the right candidate wants to choose you and work for your organization.

Interview advice seems like common sense, but it’s often not heeded, resulting in poor interviews

Don’t…

“To the candidate, if you are meeting person #3 and you’re hearing questions that person #1 and #2 asked, the company doesn’t look too hot or organized.” – President, Recruiting Firm

Practice behavioral interviews

1. In groups of at least three:

• Assign one person to act as the manager conducting the interview, a second person to act as the candidate, and a third to observe.
• The observer will provide feedback to the manager at the end of the role play based on the information you just learned.
• Observers – please give feedback on the probing questions and body language.

• How did it go?
• Were you able to get the candidate to speak in specifics rather than generalities? What tips do you have for others?
• What didn’t go so well? Any surprises?
• What would you do differently next time?
• If this was a real hiring situation, would the information you got from just that one question help you make a hiring decision for the role?

Download the Behavioral Interview Question Library

Record best practices, effective questions, and candidate insights for future use and current strategy

Results and insights gained from evaluations need to be recorded and assessed to gain value from them going forward.

• To optimize evaluation, all feedback should be forwarded to a central point so that the information can be shared with all stakeholders. HR can serve in this role.
• Peer evaluations should be shared shortly after the interview. Immediate feedback that represents all the positive and negative responses is instructional for interviewers to consider right away.
• HR can take a proactive approach to sharing information and analyzing and improving the interview process in order to collaborate with hiring departments for better talent management.
• Collecting information about effective and ineffective interview questions will guide future interview revision and development efforts.

Evaluations Can Inform Strategic Planning and Professional Development

Strategic Planning

• Survey data can be used to inform strategic planning initiatives in recruiting.
• Use the information to build a case to the executive team for training, public relations initiatives, or better candidate management systems.

Professional Development

• Survey data from all evaluations should be used to inform future professional development initiatives.
• Interview areas where all team members show weaknesses should be training priorities.
• Individual weaknesses should be integrated into each professional development plan.

Want to learn more?

Recruit IT Talent

• Improve candidate experience to hire top IT talent.

Recruit and Retain More Women in IT

• Gender diversity is directly correlated to IT performance.

Recruit and Retain People of Color in IT

• Good business, not just good philanthropy.

Develop a Comprehensive Onboarding Plan

Drive employee engagement and retention with a robust program that acclimates, guides, and develops new hires.

Onboarding should pick up where candidate experience leaves off

Do not confuse onboarding with orientation

Onboarding ≠ Orientation

Onboarding is more than just orientation. Orientation is typically a few days of completing paperwork, reading manuals, and learning about the company’s history, strategic goals, and culture. By contrast, onboarding is three to twelve months dedicated to welcoming, acclimating, guiding, and developing new employees – with the ideal duration reflecting the time to productivity for the role.

A traditional orientation approach provides insufficient focus on the organizational identification, socialization, and job clarity that a new hire requires. This is a missed opportunity to build engagement, drive productivity, and increase organizational commitment. This can result in early disengagement and premature departure.

Effective onboarding positively impacts the organization and bottom line

Over the long term, effective onboarding has a positive impact on revenue and decreases costs.

The benefits of onboarding:

• Save money and frustration
  • Shorten processing time, reduce administrative costs, and improve compliance.
• Boost revenue
  • Help new employees become productive faster – also reduce the strain on existing employees who would normally be overseeing them or covering a performance shortfall.
• Drive engagement and reduce turnover
  • Quickly acclimate new hires to your organization’s environment, culture, and values.
• Reinforce culture and employer brand
  • Ensure that new hires feel a connection to the organization’s culture.

Onboarding drives new hire engagement from day one

When building an onboarding program, retain the core aims: acclimate, guide, and develop

We recommend a three-to-twelve-month onboarding program, with the performance management aspect of onboarding extending out to meet the standard organizational performance management cycle.

Info-Tech Insight

The length of the onboarding program should align with the average time to productivity for the role(s). Consider the complexity of the role, the industry, and the level of the new hire when determining program length.

For example, call center workers who are selling a straight-forward product may only require a three-month onboarding, while senior leaders may require a year-long program.

Watch for signs that you aren’t effectively acclimating, guiding, and developing new hires

Our primary and secondary research identified the following as the most commonly stated reasons why employees leave organizations prematurely. These issues will be addressed throughout the next section.

“Onboarding is often seen as an entry-level HR function. It needs to rise in importance because it’s the first impression of the organization and can be much more powerful than we sometimes give it credit for. It should be a culture building and branding program.” – Doris Sims, SPHR, The Succession Consultant, and Author, Creative Onboarding Programs

Use the onboarding tabs in the workbook to evaluate and redesign the onboarding program

1. On tab 10, brainstorm challenges that face the organization's current onboarding program. Identify if they fall into the "acclimate," "guide," or "develop" category. Next, record the potential impact of this challenge on the overall effectiveness of the onboarding program.
2. On tab 11, record each existing onboarding activity. Then, identify if that activity will be kept or if it should be retired. Next, document if the activity fell into the "acclimate," "guide," or "develop" category.
3. On tab 12, document gaps that currently exist in the onboarding program. Modify the timeline along the side of the tab to ensure it reflects the timeline you have identified.
4. On tab 13, document the activities that will occur in the new onboarding program. This should be a combination of current activities that you want to retain and new activities that will be added to address the gaps noted on tab 12. For each activity, identify if it will fall in the acclimate, guide, or develop section. Add any additional notes. Before moving on, make sure that there are no categories that have no activities (e.g. no guide activities).

Review the administrative aspects of onboarding and determine how to address the challenges

	Sample challenges	Potential solutions
	Some paperwork cannot be completed digitally (e.g. I-9 form in the US).	Where possible, complete forms with digital signatures (e.g. DocuSign). Where not possible, begin the process earlier and mail required forms to employees to sign and return, or scan and email for the employee to print and return.
	Required compliance training material is not available virtually.	Seek online training options where possible. Determine the most-critical training needs and prioritize the replication of materials in audio/video format (e.g. recorded lecture) and distribute virtually.
	Employees may not have access to their equipment immediately due to shipping or supply issues.	Delay employee start dates until you can set them up with the proper equipment and access needed to do their job.
	New hires can’t get answers to their questions about benefits information and setup.	Schedule a meeting with an HR representative or benefits vendor to explain how benefits will work and how to navigate employee self-service or other tools and resources related to their benefits.

Info-Tech Insight

One of the biggest challenges for remote new hires is the inability to casually ask questions or have conversations without feeling like they’re interrupting. Until they have a chance to get settled, providing formal opportunities for questions can help address this.

Review how company information is shared during onboarding and how to address the challenges

	Sample challenges	Potential solutions
	Key company information such as organizational history, charts, or the vision, mission, and values cannot be clearly learned by employees on their own.	Have the new hire’s manager call to walk through the important company information to provide a personal touch and allow the new hire to ask questions and get to know their new manager.
	Keeping new hires up to date on crisis communications is important, but too much information may overwhelm them or cause unnecessary stress.	Sharing the future of the organization is a critical part of the company information stage of onboarding and the ever-changing nature of the COVID-19 crisis is informing many organizations’ future right now. Be honest but avoid over-sharing plans that may change.
	New hires can’t get answers to their questions about benefits information and setup.	Schedule a meeting with an HR representative or benefits vendor to explain how benefits will work and how to navigate employee self-service or other tools and resources related to their benefits.

Review the socialization aspects of onboarding and determine how to address the challenges

	Sample challenges	Potential solutions
	Team introductions via a team lunch or welcome event are typically done in person.	Provide managers with a calendar of typical socialization events in the first few weeks of onboarding and provide instructions and ideas for how to schedule replacement events over videoconferencing.
	New hires may not have a point of contact for informal questions or needs if their peers aren’t around them to help.	If it doesn’t already exist, create a virtual buddy program and provide instructions for managers to select a buddy from the new hire’s team. Explain that their role is to field informal questions about the company, team, and anything else and that they should book weekly meetings with the new hire to stay in touch.
	New hires will not have an opportunity to learn or become a part of the informal decision-making networks at the organization.	Hiring managers should consider key network connections that new hires will need by going through their own internal network and asking other team members for recommendations.
	New hires will not be able to casually meet people around the office.	Provide the employee with a list of key contacts for them to reach out to and book informal virtual coffee chats to introduce themselves.

Adapt the Guide phase of onboarding to a virtual environment

	Sample challenges	Potential solutions
	Performance management (PM) processes have been paused given the current crisis.	Communicate to managers that new hires still need to be onboarded to the organization’s performance management process and that goals and feedback need to be introduced and the review process outlined even if it’s not currently happening.
	Goals and expectations differ or have been reprioritized during the crisis.	Ask managers to explain the current situation at the organization and any temporary changes to goals and expectations as a result of new hires.
	Remote workers often require more-frequent feedback than is mandated in current PM processes.	Revamp PM processes to include daily or bi-weekly touchpoints for managers to provide feedback and coaching for new hires for at least their first six months.
	Managers will not be able to monitor new hire work as effectively as usual.	Ensure there is a formal approach for how employees will keep their managers updated on what they're working on and how it's going, for example, daily scrums or task-tracking software.

For more information on adapting performance management to a virtual environment, see Info-Tech’s Performance Management for Emergency Work-From-Home research.

Take an inventory of training and development in the onboarding process and select critical activities

Categorize the different types of formal and informal training in the onboarding process into the following three categories. For departmental and individual training, speak to managers to understand what is required on a department and role basis:

In a crisis, not every training can be translated to a virtual environment in the short term. It’s also important to focus on critical learning activities versus the non-critical. Prioritize the training activities by examining the learning outcomes of each and asking:

• What organizational training does every employee need to be a productive member of the organization?
• What departmental or individual training do new hires need to be successful in their role?

Lower priority or non-critical activities can be used to fill gaps in onboarding schedules or as extra activities to be completed if the new hire finds themselves with unexpected downtime to fill.

Determine how onboarding training will be delivered virtually

Who will facilitate virtual training sessions?

• For large onboarding cohorts, consider live delivery via web conferencing where possible. This will create a more engaging training program and will allow new hires to interact with and ask questions of the presenter.
• For individual new hires or small cohorts, have senior leaders or key personnel from across the organization record different trainings that are relevant for their role.
• For example, training sessions about organizational culture can be delivered by the CEO or other senior leader, while sales training could be delivered by a sales executive.

If there is a lack of resources, expertise, or time, outsource digital training to a content provider or through your LMS.

What existing or free tools can be leveraged to immediately support digital training?

• Laptops and PowerPoint to record training sessions that are typically delivered in-person
• YouTube/Vimeo to host recorded lecture-format training
• Company intranet to host links and files needed to complete training
• Web conferencing software to host live training/orientation sessions (e.g. Webex)
• LMS to host and track completion of learning content

Want to learn more?

Recruit IT Talent

• Improve candidate experience to hire top IT talent.

Recruit and Retain More Women in IT

• Gender diversity is directly correlated to IT performance.

Recruit and Retain People of Color in IT

• Good business, not just good philanthropy.

Adapt Your Onboarding Process to a Virtual Environment

• Develop short-term solutions with a long-term outlook to quickly bring in new talent.

Bibliography

2021 Recruiter Nation Report. Survey Analysis, Jobvite, 2021. Web.

“5 Global Stats Shaping Recruiting Trends.” The Undercover Recruiter, 2022. Web.

Barr, Tavis, Raicho Bojilov, and Lalith Munasinghe. "Referrals and Search Efficiency: Who Learns What and When?" The University of Chicago Press, Journal of Labor Economics, vol. 37, no. 4, Oct. 2019. Web.

“How to grow your team better, faster with an employee referral program.” Betterup, 10 Jan. 2022. Web.

“Employee Value Proposition: How 25 Companies Define Their EVP.” Built In, 2021. Web.

Global Leadership Forecast 2021. Survey Report, DDI World, 2021. Web.

“Connecting Unemployed Youth with Organizations That Need Talent.” Harvard Business Review, 3 November 2016. Web.

Ku, Daniel. “Social Recruiting: Everything You Need To Know for 2022.” PostBeyond, 26 November 2021. Web.

Ladders Staff. “Shedding light on the job search.” Ladders, 20 May 2013. Web.

Merin. “Campus Recruitment – Meaning, Benefits & Challenges.” HR Shelf, 1 February 2022. Web.

Mobile Recruiting. Smart Recruiters, 2020. Accessed March 2022.

Roddy, Seamus. “5 Employee Referral Program Strategies to Hire Top Talent.” Clutch, 22 April 2020. Web.

Sinclair, James. “What The F*dge: That's Your Stranger Recruiting Budget?” LinkedIn, 11 November 2019. Web.

“Ten Employer Examples of EVPs.” Workology, 2022. Web

“The Higher Cost of a Bad Hire.” Robert Half, 15 March 2021. Accessed March 2022.

Trost, Katy. “Hiring with a 90% Success Rate.” Katy Trost, Medium, 8 August 2022. Web.

“Using Social Media for Talent Acquisition.” SHRM, 20 Sept. 2017. Web.

Improve IT Governance to Drive Business Results

Avoid bureaucracy and achieve alignment with a minimalist approach.

ANALYST PERSPECTIVE

Governance optimization is achieved where decision making, authority, and context meet.

"Governance is something that is done externally to IT and well as internally by IT, with the intention of providing oversight to direct the organization to meet goals and keep things on target.

Optimizing IT governance is the most effective way to consistently direct IT spend to areas that provide the most value in producing or supporting business outcomes, yet it is rarely done well.

IT governance is more than just identifying where decisions are made and who has the authority to make them – it must also provide the context and criteria under which decisions are made in order to truly provide business value" (Valence Howden, Director, CIO Practice Info-Tech Research Group)

Our understanding of the problem

This Research is Designed For:

• CIOs
• CTOs
• IT Directors

This Research Will Help You:

• Achieve and maintain executive and business support for optimizing IT governance.
• Optimize your governance structure.
• Build high-level governance processes.
• Build governance committee charters and set accountability for decision making.
• Plan the transition to the optimized governance structure and processes.

This Research Will Also Assist:

• Executive Leadership
• IT Managers
• IT Customers
• Project Managers

This Research Will Help Them:

• Improve alignment between business decisions and IT initiatives.
• Establish a mechanism to validate, redirect, and reprioritize IT initiatives.
• Realize greater value from more effective decision making.
• Receive a better overall quality of service.

Executive Summary

Situation

• IT governance is the #1 predictor of value generated by IT, yet many organizations struggle to organize their governance effectively.*
• Current IT governance does not address the changing goals, risks, or context of the organization so IT spend is not easily linked to value.
• The right people are not making the right decisions about IT.

Complication

• Organizations do not have a governance framework in place that optimally aligns IT with the business objectives and direction.
• Implementing IT governance requires the involvement of key business stakeholders who do not see IT’s value in governance and strategy.
• The current governance processes are poorly designed, creating long decision-making cycles and driving non-compliance with regulation.

Resolution

• Use Info-Tech’s four-step process for optimizing your IT governance framework. Our client-tested methodology supports the enablement of IT-business alignment, decreases decision-making cycle times, and increases IT’s transparency and effectiveness in making decisions around benefits realization, risks, and resources.
• Successful completion of the IT governance redesign will result in the following outcomes:
  1. Align IT with the business context.
  2. Assess the current governance framework.
  3. Redesign the governance framework.
  4. Implement governance redesign.

Info-Tech Insight

• Establish IT-business fusion. In governance, alignment is not enough. Merge IT and the business through governance to ensure business success.
• With great governance comes great responsibility. Involve relevant business leaders, who will be impacted by IT outcomes, to take on governing responsibility of IT.
• Let IT manage and the business govern. IT governance should be a component of enterprise governance, allowing IT leaders to focus on managing.

IT governance is...

An enabling framework for decision-making context and accountabilities for related processes.

A means of ensuring business-IT collaboration, leading to increased consistency and transparency in decision making and prioritization of initiatives.

A critical component of ensuring delivery of business value from IT spend and driving high satisfaction with IT.

IT governance is not...

An annoying, finger-waving roadblock in the way of getting things done.

Limited to making decisions about technology.

Designed tacitly; it is purposeful, with business objectives in mind.

A one-time project; you must review and revalidate the efficiency.

Avoid common misconceptions of IT governance

Don’t blur the lines between governance and management; each has a unique role to play. Confusing these results in wasted time and confusion around ownership.

Governance		Management
IT governance sets direction through prioritization and decision making, and monitors overall IT performance. Governance aligns with the mission and vision of the organization to guide IT.		Management is responsible for executing on, operating, and monitoring activities as determined by IT governance. Management makes decisions for implementing based on governance direction.

The IT Governance Framework

An IT governance framework is a system that will design structures, processes, authority definitions, and membership assignments that lead IT toward optimal results for the business.

Governance is performed in three ways:

1. Evaluate

   Governance ensures that business goals are achieved by evaluating stakeholder needs, criteria, metrics, portfolio, risk, and definition of value.

2. Direct

   Governance sets the direction of IT by delegating priorities and determining the decisions that will guide the IT organization.

3. Monitor

   Governance establishes a framework to monitor performance, compliance to regulation, and progress on expected outcomes.

"Everyone needs good IT, but no one wants to talk about it. Most CFOs would rather spend time with their in-laws than in an IT steering-committee meeting. But companies with good governance consistently outperform companies with bad. Which group do you want to be in?" (Martha Heller, President, Heller Search Associates)

Create impactful IT governance by embedding it within enterprise governance

The business should engage in IT governance and IT should influence the direction of the business.

Identify signals of sub-optimal IT governance within any of these domains

If you notice any of these signals, governance redesign is right for you!

Inability to Realize Benefits

1. IT is unable to articulate the value of its initiatives or spend.
2. IT is regularly delegated unplanned projects.
3. The is no standard approach to prioritization.
4. Projects do not meet target metrics.

Resource Misallocation

1. Resources are wasted due to duplication or overlap in IT initiatives.
2. IT projects fail at an unacceptable rate, leading to wasted resources.
3. IT’s costs continue to increase without reciprocal performance increase.

Misdiagnosed Risks

1. Risk appetite is incorrectly identified or not identified at all.
2. Disagreement on the approach to risk in the organization.
3. Increasing rate of IT incidents related to risk.
4. IT is failing to meet regulatory requirements.

Dissatisfied Stakeholders

1. There are no ways to measure stakeholder satisfaction with IT.
2. Business strategies and IT strategies are misaligned.
3. IT’s relationship with key stakeholders is unstable and there is a lack of mutual trust.

A majority of organizations experience significant alignment gaps

The majority of organizations and their key stakeholders experience highly visible gaps in the alignment of IT investments and organizational goals.

88% of CIOs believe that their governance is not effective. (Info-Tech Diagnostics)

Leverage governance as the catalyst for connecting IT and the business

49% of firms are misaligned on current performance expectations for IT.

• 49% Misaligned
• 51% Aligned

67% of firms are misaligned on the target role for IT.

• 34% Highly Misaligned
• 33% Somewhat Misaligned
• 33% Aligned

A well-designed IT governance framework will hep you to:

1. Make sure IT keeps up with the evolving business context.
2. Align IT with the mission and the vision of the organization.
3. Optimize the speed and quality of decision making.
4. Meet regulatory and compliance needs in the external environment.
(Info-Tech Diagnostics)

Align with business goals through governance to attain business-IT fusion

Create a state of business-IT fusion, in which the two become one.

Without business-IT fusion, IT will go in a different direction, leading to a divergence of purpose and outcomes. IT can transform into a fused partner of the business by ensuring that they govern toward the same goal.

Firefighter Delivers lower value Duplication of effort Unclear risk profile High risk exposure

Business Partner Increased speed of decision making Aligned with business priorities Optimized utility of people, financial, and time resources Monitors and mitigates risk and compliance issues

Redesign IT governance in accordance with COBIT and proven good practice

Info-Tech’s approach to governance redesign is rooted in COBIT, the world-class and open-source IT governance standard.

COBIT begins with governance, EDM – Evaluate, Direct, and Monitor.

We build upon these standards with industry best practices and add a practical approach based on member feedback.

This blueprint will help you optimize your governance framework.

Use Info-Tech’s approach to implementing an IT governance redesign

The four phases of Info-Tech’s governance redesign methodology will help you drive greater value for the business.

1. Align IT With the Business Context
   Align IT’s direction with the business using the Statement of Business Context Template.
2. Assess the Current Governance Framework
   Evaluate the strengths and weaknesses of current governance using the Current State Assessment of IT Governance.
3. Redesign the Governance Framework
   Build a redesign of the governance framework using the Future State Design for IT Governance tool.
4. Implement Governance Redesign
   Create an IT Governance Implementation Plan to jumpstart the communication of the redesign and set it up for success.
Continuously assess your governance framework to ensure alignment.

Leverage Info-Tech’s insights for an optimal redesign process

Leverage both COBIT and Info-Tech-defined metrics to evaluate the success of your redesign

These metrics will help you determine the extent to which your governance is supporting your business goals, and whether the governance in place promotes business-IT fusion.

Benefits Realization

1. Percent of IT-enabled investments where benefit realization is monitored through the full economic life. (COBIT-defined metric)
2. Percent of enterprise strategic goals and requirements supported by IT strategic goals. (COBIT-defined metric)
3. Percent of IT services where expected benefits are realized or exceeded. (COBIT-defined metric)

Resources

1. Satisfaction level of business and IT executives with IT-related costs and capabilities. (COBIT-defined metric)
2. Average time to turn strategic IT objectives into an agreed-upon and approved initiative. (COBIT-defined metric)
3. Number of deviations from resource utilization plan.

Risks

1. Number of security incidents causing financial loss, business disruption, or public embarrassment. (COBIT-defined metric)
2. Number of issues related to non-compliance with policies. (COBIT-defined metric)
3. Percentage of enterprise risk assessments that include IT-related risks. (COBIT-defined metric)
4. Frequency with which the risk profile is updated. (COBIT-defined metric)

Stakeholders

1. Change in score of alignment with the scope of the planned portfolio of programs and services (using CIO-CXO Alignment Diagnostic).
2. Percent of executive management roles with clearly defined accountabilities for IT decisions. (COBIT-defined metric)
3. Percent of business stakeholders satisfied that IT service delivery meets agreed-upon service levels. (COBIT-defined metric)
4. Percent of key business stakeholders involved in IT governance.

Capture monetary value by establishing and monitoring key metrics

While benefits of governance are often qualitative, the power of effective governance can be demonstrated through quantitative financial gains.

Redesign IT governance to achieve optimal business outcomes

CASE STUDY

Industry: Healthcare
Source: Info-Tech

Situation

The IT governance had been structured based on regulations and had not changed much since it was put in place. However, a move to become an integration and service focused organization had moved the organization into the world of web services, Agile development, and service-oriented architecture.

Complication

The existing process was well defined and entrenched, but did not enable rapid decision making and Agile service delivery. This was due to the number of committees where initiatives were reviewed, made worse by their lack of approval authority. This led to issues moving initiatives forward in the timeframes required to meet clinician needs and committed governmental deadlines.

In addition, the revised organizational mandate had created confusion regarding the primary purpose and function of the organization and impacted the ability to prioritize spend on a limited budget.

To complicate matters further, there was political sensitivity tied to the membership and authority of different governing committees.

Result:

The CEO decided that a project would be initiated by the Enterprise Architecture Group, but managed by an external consultant to optimize and restructure the governance within the organization.

The purpose of using the external consultant was to help remove internal politics from the discussion. This allowed the organization to establish a shared view of the organization’s revised mission and IT’s role in its execution.

The exercise led to the removal of one governing committee and the merger of two others, modification to committee authority and membership, and a refined decision-making context that was agreed to by all parties.

The redesigned governance process led to a 30% reduction in cycle time from intake to decision, and a 15% improvement in alignment of IT spend with strategic priorities.

Use these icons to help direct you as you navigate this research

Use these icons to help guide you through each step of the blueprint and direct you to content related to the recommended activities.

This icon denotes a slide where a supporting Info-Tech tool or template will help you perform the activity or step associated with the slide. Refer to the supporting tool or template to get the best results and proceed to the next step of the project.

This icon denotes a slide with an associated activity. The activity can be performed either as part of your project or with the support of Info-Tech team members, who will come onsite to facilitate a workshop for your organization.

Info-Tech offers various levels of support to best suit your needs

Diagnostics and consistent frameworks used throughout all four options

Redesign IT Governance – project overview

	Align IT With the Business Context	Assess the Current State	Redesign Governance	Implement Redesign
Best-Practice Toolkit	1.1 Identify Stakeholders 1.2 Make the Case 1.3 Present to Executives 1.4 Customize Comm. Plan 1.5 Review Documents 1.6 Analyze Frameworks 1.7 Conduct Brainstorming 1.8 Finalize the SoBC	2.1 Create Committee Profiles 2.2 Build a Governance Structure Map 2.3 Establish Governance Guidelines	3.1 Build Governance Structure Map 3.2 Create Committee Profiles 3.3 Leverage Process Specific Governance Blueprints	4.1 Identify Next Steps for the Redesign 4.2 Establish Communication Plan 4.3 Lead Executive Presentation
Guided Implementations	Move towards gaining buy-in from the business if necessary. Then identify the major components of the SoBC. Review SoBC and discuss a strategy to engage key stakeholders in the redesign.	Explore the process of identifying the four major elements of governance. Build guidelines for the future state. Review the current state of governance and discuss the implications and guidelines.	Identify the changes that will need to be made. Review redesigned structure and authority. Review redesigned process and membership.	Discuss and review the implementation plan. Prepare the presentation for the executives. Provide support on any final questions.
Onsite Workshop	Module 1: Align IT with the business context	Module 2: Assess the current governance framework	Module 3: Redesign the governance framework	Module 4: Implement governance redesign
	Phase 1 Results: Align IT’s direction with the business.	Phase 2 Results: Evaluate the strengths and weaknesses of current governance and build guidelines.	Phase 3 Results: Establish a redesign of the governance framework.	Phase 4 Results: Create an implementation plan for the communication of the redesign.

Workshop overview

Contact your account representative or email Workshops@InfoTech.com for more information.

Improve IT Governance to Drive Business Results

PHASE 1

Align IT With the Business Context

Phase 1 outline

Complete these steps on your own, or call us to complete a guided implementation. A guided implementation is a series of 2-3 advisory calls that help you execute each phase of a project. They are included in most advisory memberships.

Guided Implementation 1: Align IT With the Business Context

Proposed Time to Completion: 2-4 weeks

Phase 1: Align IT With the Business Context

Activities:

• 1.1 Identify Stakeholders
• 1.2 Customize Make the Case Presentation
• 1.3 Present to Executives
• 1.4 Customize Communication Plan
• 1.5 Review Business Documents
• 1.6 Analyze Business Frameworks
• 1.7 Conduct Brainstorming Efforts
• 1.8 Finalize the SoBC

Outcomes:

• Make the case for a governance redesign.
• Create a custom communication plan to facilitate support for the redesign process.
• Establish a collectively agreed upon statement of business context.

Set up business-driven governance by gaining an understanding of the business context

Fuse IT with the business by establishing a common context of what the business is trying to achieve. Align IT with the business by developing an understanding of the business state, creating a platform to build a well-aligned governance framework.

"IT governance philosophies can no longer be a ‘black box’ … IT governance can no longer be ignored by senior executives." (Iskandar and Mohd Salleh, University of Malaya, International Journal of Digital Society)

Info-Tech Insight

Get consensus on the changing state of business. There must be an active understanding of the current and future state of the business for governance to address the changing needs of the business.

The source for the governance redesign directive will dictate the route for attaining leadership buy-in

"Without an awareness of IT governance, there is no chance that it will be followed … The higher the percentage of managers who can describe your governance, the higher the governance performance." (Jeanne Ross, Director, MIT Center for Information Systems Research)

The path you will choose for your governance buy-in tactics will be based on the original directive to redesign governance.

Enterprise Directive.
In the case that the redesign is an enterprise directive, jump directly to building a communication plan.

IT Directive.
In the case that the redesign is an IT directive, make the case to get the business on board.

Use the Make the Case presentation template to get buy-in from the business

INSTRUCTIONS

1. Identify Stakeholders
   Determine which business stakeholders will be impacted or involved in the redesign process.
2. Customize the Presentation
   Identify specific pain points regarding IT-business alignment.
3. Present to Executives
   Present the make the case presentation.

Info-Tech Best Practice

Use the Make the Case customizable deliverable to lead a boardroom-quality presentation proving the specific need for senior executive involvement in the governance redesign.

Determine which business stakeholders will be impacted or involved in the redesign process

It is vital to identify key business and IT stakeholders before the IT governance redesign has begun. Consider whose input and influence will be necessary in order to align with the business context and redesign the governance framework accordingly.

Business

• Shareholders
• Board
• Chief Executive Officer
–› Example: the CEO wants to know how IT will support the achievement of strategic corporate objectives.
• Chief Financial Officer
• Chief Operating Officer
• Business Executives
• Business Process Owners
• Strategy Executive Committee
• Chief Risk Officer
• Chief Information Security Officer
• Architecture Board
• Enterprise Risk Committee
• Head of Human Resources
• Compliance
• Audit

IT

• Chief Information Officer
–› Example: the CIO would like validation from the business with regards to prioritization criteria.
• Head Architect
• Head of Development
• Head of IT Operations
• Head of IT Administration
• Service Manager
• Information Security Manager
• Business Continuity Manager
• Privacy Officer

External

• Government Agency
–› Example: some governments mandate that organizations develop and implement an IT governance framework.
• Audit Firm

Build a power map to prioritize stakeholders

Stakeholders may have competing concerns – that is, concerns that cannot be addressed with one solution. The governance redesigner must prioritize their time to address the concerns of the stakeholders who have the most power and who are most impacted by the IT governance redesign.

Draw a stakeholder power map to visualize the importance of various stakeholders and their concerns, and to help prioritize your time with those stakeholders.

• Power: How much influence does the stakeholder have? Enough to drive the project forward or into the ground?
• Involvement: How interested is the stakeholder? How much involvement does the stakeholder have in the project already?
• Impact: To what degree will the stakeholder be impacted? Will this significantly change the job?
• Support: Is the stakeholder a supporter of the project? Neutral? A resistor?

Download Info-Tech’s Stakeholder Power Map Template to help you visualize your key stakeholders.

Build a power map to prioritize stakeholders

1.1

It is important to identify who will be impacted and who has power, and the level of involvement they have in the governance redesign. If they have power, will be highly impacted, and are not involved in governance, you have already lost – because they will resist later. You need to get them involved early.

• Focus on key players – relevant stakeholders who have high power, are highly impacted, and should have a high level of involvement.
• Engage the stakeholders that are impacted most and have the power to impede the success of redesigning IT governance.
  • For example, if a CFO, who has the power to block project funding, is heavily impacted and not involved, the IT governance redesign success will be put at risk.
• Some stakeholders may have influence over others so you should focus your efforts on the influencer rather than the influenced.
  • For example, if an uncooperative COO is highly influenced by the Director of Operations, it is recommended to engage the latter.

Identify specific pain points regarding business-IT alignment

INPUT: Signal Questions, CIO-CXO Alignment Diagnostic

OUTPUT: List of Categorized Pain Points

Materials: Make the Case for an IT Governance Redesign

Participants: Identified Key Business Stakeholders

1. Consider Signals for Redesign
   Refer to the Executive Brief for questions to identify pain points related to governance.
   • Benefits Realization
   • Resources
   • Risks
   • Stakeholders
2. Conduct CIO-CEO Alignment Diagnostic
   Assess the current state of alignment between the CIO and the major stakeholders of the organization.

See the CEO-CIO Alignment Program for more information.

Conduct the CEO-CIO Alignment Diagnostic

Why CEO-CIO Alignment?

The CEO-CIO Alignment Program helps you understand the gaps between what the CEO wants for IT and what the CIO wants for IT. The program will also evaluate the current state of IT, from a strategic and tactical perspective, based on the CEO’s opinion.

The CEO-CIO Alignment Program helps to:

• Evaluate how the executive leadership currently feels about the IT organization’s performance along the following dimensions:
  • IT budgeting and staffing
  • IT strategic planning
  • Degree of project success
  • IT-business alignment
• Answer the question, “What does the CEO want from IT?”
• Understand the CEO’s perception of and vision for IT in the business.
• Define the current and target roles for IT. Understanding IT’s current and target roles, in the eyes of the CEO, is crucial to creating IT governance. By focusing the IT governance on achieving the target role, you will ensure that the senior leadership will support the implementation of the IT governance.

To conduct the CEO-CIO Alignment Program, follow the steps outlined below.

1. Select the senior business leader to participate in the program. While Info-Tech suggests that the CEO participate, you might have other senior stakeholders who should be involved.
2. Send the survey link to your senior business stakeholder and ensure the survey’s completion.
3. Complete your portion of the survey.
4. Hold a meeting to discuss the results and document your findings.

See the CEO-CIO Alignment Program for more information.

Present the “Make the Case” for IT governance redesign

1.3 30 minutes

1. Review Finalized Stakeholder List
   Consolidate a list of the most important and impactful stakeholders who need further convincing to participate in the governance redesign and implementation.
2. Present the Deck
   Include the information gathered throughout the discovery into the presentation deck and hold a meeting to review the findings.

Business

• Shareholders
• Board
• Chief Executive Officer
• Chief Financial Officer
• Chief Operating Officer
• Business Executives
• Strategy Executive Committee
• Chief Risk Officer
• Architecture Board
• Enterprise Risk Committee
• Head of Human Resources
• Compliance

IT

• Chief Information Officer

External

• Government Agency
• Audit Firm

Use the Make the Case for an IT Governance Redesign template for more information.

Create a custom communication plan to facilitate support for the redesign process

1B Create a plan to engage the key stakeholders

INSTRUCTIONS

1. Identify Stakeholders
   Determine which business stakeholders will be involved (refer to Activity 1.1).
2. Customize Communication Plan
   Follow up with individual communication plans.

Info-Tech Best Practice

Create personal communication plans to provide individualized engagement, instead of assuming that everyone will respond to the same communication style.

Download the IT Governance Stakeholder Communication Planning Tool for more information.

Create a communication plan to engage key stakeholders

1. Input Stakeholders
   Determine which business stakeholders will be involved (refer to Activity 1.1). Then, insert their position on the power map, the rationale to inform them, the timing of communications, and what inputs they will be needed to provide.

   Stakeholder role	Power map position	Why inform them	When to inform them	What we need from them
   Chief Executive Officer
   Chief Financial Officer
   Chief Operating Officer

2. Identify Communication Strategy
   Outline the most effective communication plan for that stakeholder. Identify how to best communicate to the stakeholders to make sure they are appropriately engaged in the redesign process.

   Vehicle	Audience	Purpose	Frequency	Owner	Distribution	Level of detail
   Status Report	IT Managers	Project progress and deliverable status	Weekly	CIO, John Smith	Email	Details for milestones, deliverables, budget, schedule, issues, next steps
   Status Report	Marketing Manager	Project progress	Monthly	CIO, John Smith	Email	High-level detail for major milestone update and impact to the marketing unit

Establish a collectively agreed upon statement of business context (SoBC)

1C Document the mutual understanding of the business context

INSTRUCTIONS

1. Review Business Documents
   Review business documents from broad areas of the business to assess the business context.
2. Analyze Business Frameworks
   Analyze business frameworks to articulate the current and projected future business context.
3. Brainstorm With Key Stakeholders
   Conduct stakeholder brainstorming efforts to gain insights from key business stakeholders.
4. Finalize the SoBC
   Document and sign the SoBC with identified stakeholders.

Info-Tech Best Practice

Use the Statement of Business Context customizable deliverable as a point of reference that will guide the direction of the governance redesign.

Use the Statement of Business Context to identify the critical information needed to guide governance

Components of the SoBC Mission Who are you as an organization? Who are your internal and external customers? What are your core business functions? Example (Higher Education) Nurture global leaders and provide avenues for intellectual exploration. Vision Is your vision statement future-facing? Is your vision statement concise? Is your vision statement achievable? Does your vision statement involve change? Example Be a catalyst for creating the future leaders of tomorrow through dynamic and immersive educational experiences. The university will be recognized for being a prestigious innovative research hub and educational institution.

Use the Statement of Business Context to identify the critical information needed to guide governance (cont.)

More Components of the SoBC Strategic Objectives What are the strategic initiatives of the organization? Do you have a roadmap to accomplish your mission? What are the primary goals of senior leaders for the organization? Example Meeting government regulation Revenue generation Top research quality High teaching quality
State of Business Consider what the current state and future state are. How does the operating model used define the state? How do industry trends shape the business? What internal changes impact the business model? Example Our organization aims to make quick decisions and navigate the fast-paced industry with agility, uniting the development and operational sides of the business.

Leverage core concepts to determine the direction of the organization’s state of the business

Review business documents to assess business context

INPUT: Strategic Documents, Financial Documents

OUTPUT: Mission, Vision, Strategic Objectives

Materials: Corporate Documents

Participants: IT Governance Redesign Owner

Start assessing the state of the business context by leveraging easily accessible information. Many organization have strategic plans, documents, and presentations that already include a large portion of the information for the SoBC – use these sources first.

Instructions

1. Strategic Documents
   Leverage your organization’s strategic documents to gain understanding of the business context.

Documents to Review:

• Corporate strategy document.
• Business unit strategy documents.
• Annual general reports.

• Look for large capital expenditures.
• Review operating costs.
• Business cases submitted.

Review strategic planning documents

Overview

Some organizations (and business units) create an authoritative strategy document. These documents contain the organization’s corporate aspirations and outline initiatives, reorganizations, and shifts in strategy. Additionally, some documents contain strategic analysis (Porter’s Five Forces, etc.).

Action

• Read through any of the following:
  • Corporate strategy document
  • Business unit strategy documents
  • Annual general reports
• Watch out for key future-looking words:
  • We will be…
  • We are planning to…

Overt Statements

• Corporate objectives and initiatives are often explicitly stated in these documents. Look for statements that begin with phrases such as “Our corporate objectives are…”
• Remember that different organizations use different terminology – if you cannot find the word “goal” or “objective” then look for “pillar,” “imperative,” “theme,” etc.
• Ask a business partner to assist if you need some help.

Covert, Outdated, and Non-Existent Statements

• Some corporate objectives and initiatives will be mentioned in passing and will require clarification, for example:
  “As we continue to penetrate new markets, we will be diversifying our manufacturing geography to simplify distribution.”
• Some corporate strategies may be outdated and therefore of limited use for understanding the state of business – validate the statement to ensure it is up to date.
• Some organizations lack a strategic plan altogether. Use stakeholder interviews to identify imperatives and validate conflicting statements before moving on.

Review financial documentation

Overview

Departmental budgets highlight the new projects that will launch in the next fiscal year. The overwhelming majority of these projects will have IT implications. Additionally, identifying where the department is spending money will allow you to identify business unit initiatives and operational change.

Action

• Scan budgets:
  • Look for large capital expenditures
  • Review operating costs
  • Review business cases submitted
• Look for abnormalities or changes:
  • What does an increase in spending mean?
  • Does IT need to change as a result?

Capital Budgets

• Capital expenditures are driven by projects, which map to corporate goals and initiatives.
• Look for large capital expenditures and cross-reference the outflows with any project plans that have been collected.
• If an expenditure cannot be explained by project plans, request additional information.

Operating Budgets

• Major changes to operating costs typically reflect changes to a business unit. Some of these changes affect IT capabilities and can be classified as corporate initiatives.
• Changes that should be classified as corporate initiatives are expansion or contraction of a labor force, outsourcing initiatives, and significant process changes.
• Changes that should not be classified as corporate initiatives are changes in third-party fees, consulting engagements, and changes caused by inflation or growth.

Analyze business frameworks to articulate context

1.6 2-4 hours

INPUT: Industry Research, Organizational Research, Analysis Templates

OUTPUT: PESTLE and SWOT Analysis

Materials: Computer or Whiteboards and Markers

Participants: IT Governance Redesign Owner

If corporate documents denoting the key components of the SoBC are not easily available, or do not provide all information required, refer to business analysis frameworks to discover internal and external trends that impact the mission, vision, strategic objectives, and state of the business.

1. Conduct a PESTLE Analysis
   The PESTLE analysis will support the organization in identifying external factors that impact the business. Keep watch for trends and changes in the industry.

Political

Economic

Social

Technological

Legal

Environmental

2. Conduct a SWOT Analysis
   The SWOT analysis will be more specific to the organization and the industry in which it operates. Identify the unique strengths, weaknesses, opportunities, and threats for your organization.

Strengths

Weaknesses

Opportunities

Threats

Conduct a PESTLE analysis

• Break participants into teams and divide the categories amongst them:
  • Political trends
  • Economic trends
  • Social trends
  • Technological trends
  • Legal trends
  • Environmental trends
• Have each group identify relevant trends under their respective categories. You must relate each trend back to the business by considering:
  • How does this affect my business?
  • Why do we care?
• Use the prompt questions on the next slide to help the brainstorming process.
• Have each team present its list and have remaining teams give feedback and additional suggestions.

Political. Examine political factors such as taxes, environmental regulations, and zoning restrictions.

Economic Examine economic factors such as interest rates, inflation rate, exchange rates, the financial and stock markets, and the job market.

Social. Examine social factors such as gender, race, age, income, disabilities, educational attainment, employment status, and religion.

Technological. Examine technological factors such as servers, computers, networks, software, database technologies, wireless capabilities, and availability of software as a service.

Legal. Examine legal factors such as trade laws, labor laws, environmental laws, and privacy laws.

Environmental. Examine environmental factors such as green initiatives, ethical issues, weather patterns, and pollution.

Download Info-Tech’s PESTLE Analysis Template to help get started.

Review these questions to help you conduct a PESTLE analysis

For each prompt below, always try to answer the question: how does this affect my business?

Political

• Will a change in government (at any level) affect your organization?
• Do inter-government or trade relations affect you?
• Are there shareholder needs or demands that must be considered?

Economical

• How are your costs changing (moving off-shore, fluctuations in markets, etc.)?
• Do currency fluctuations have an effect on your business?
• Can you attract and pay for top-quality talent (e.g. desirable location, reasonable cost of living, changes to insurance requirements)?

Social

• What are the demographics of your customers or employees?
• What are the attitudes of your customers or staff (do they require social media, collaboration, transparency of costs, etc.)?
• What is the general lifecycle of an employee (i.e. is there high turnover)?
• Is there a market of qualified staff?
• Is your business seasonal?

Technological

• Do you require constant technology upgrades (faster network, new hardware, etc.)?
• What is the appetite for innovation within your industry or business?
• Are there demands for increasing data storage, quality, BI, etc.?
• Are you looking at cloud technologies?
• What is the stance on “bring your own device”?
• Are you required to do a significant amount of development work in-house?

Legal

• Are there changes to trade laws?
• Are there changes to regulatory requirements, e.g. data storage policies or privacy policies?
• Are there union factors that must be considered?

Environmental

• Is there a push towards being environmentally friendly?
• Does the weather have any effect on your business (hurricanes, flooding, etc.)?

Conduct a SWOT analysis on the business

Break the group into two teams.

Assign team A internal strengths and weaknesses.

Assign team B external opportunities and threats.

• Have the teams brainstorm items that fit in their assigned grids. Use the prompt questions on the next slide to help you with your SWOT analysis.
• Pick someone from each group to fill in the grids on the whiteboard.
• Conduct a group discussion about the items on the list. Identify implications for IT and opportunities to innovate as you did for the other business and external drivers.

Download Info-Tech’s Business SWOT Analysis Template to help get started.

Review these questions to help you conduct your SWOT analysis on the business

Strengths (Internal)

• What competitive advantage does your organization have?
• What do you do better than anyone else?
• What makes you unique (human resources, product offering, experience, etc.)?
• Do you have location advantages?
• Do you have price, cost, or quality advantages?
• Does your organizational culture offer an advantage (hiring the best people, etc.)?

Weaknesses (Internal)

• What areas of your business require improvement?
• Are there gaps in capabilities?
• Do you have financial vulnerabilities?
• Are there leadership gaps (succession, poor management, etc.)?
• Are there reputational issues?
• Are there factors that are making you lose sales?

Opportunities (External)

• Are there market developments or new markets?
• Industry or lifestyle trends, e.g. move to mobile?
• Are there geographical changes in the market?
• Are there new partnerships or M&A opportunities?
• Are there seasonal factors that can be used to the advantage of the business?
• Are there demographic changes that can be used to the advantage of the business?

Threats (External)

• Are there obstacles that the organization must face?
• Are there issues with respect to sourcing of staff or technologies?
• Are there changes in market demand?
• Are your competitors making changes that you are not making?
• Are there economic issues that could affect your business?

Conduct brainstorming efforts to gain insights from key business stakeholders

INPUT: SoBC Template

OUTPUT: Completed SoBC

Materials: Computer, Phone, or Other Mechanism of Connection

Participants: CEO, CFO, COO, CMO, CHRO, and Business Unit Owners

There are two ways to gather primary knowledge on the key components of the SoBC:

1. Stakeholder Interviews
   Approach each individual to have a conversation about the key components of the SoBC. Go through the SoBC and fill it in together.
2. Stakeholder Survey
   In the case that you are in a very large organization, create a stakeholder survey. Input the key components of the SoBC into an online survey maker and send it off the key stakeholders.

Use the SoBC as the guide to both the interview and the survey. Be clear about the purpose of understanding the business context when connecting with key business stakeholders to participate in the brainstorming. This is a perfect opportunity to establish or develop a relationship with the stakeholders who will need to buy into the redesigned governance framework since it will involve and impact them significantly.

Go directly to the information source – the key stakeholders

Overview

Talking to key stakeholders will allow you to get a holistic view of the business strategy. You will be able to ask follow-up questions to get a better understanding of abstract or complex concepts. Interviews also allow you to have targeted discussions with specific stakeholders who have in-depth subject-matter knowledge.

Action

• Talk to key stakeholders:
  • Structure focused, i.e. CEO or CFO
  • Customer focused, i.e. CMO or Head of Sales
  • Operational focused, i.e. COO
  • Lower-level employees or managers
• Listen for key pains that IT could alleviate.

Overcome the Unstructured Nature of Interviews

• Interviewees will often explicitly state objectives and initiatives.
• However, interviews are less formal and less structured than objective-oriented strategy documents. Objectives are often stated using informal language.
  “We’re talking rev gen here. That’s the name of the game. If we can get a foothold in India, there’s huge upside potential.” (VP Marketing)
• Further analysis might translate this into a corporate imperative: increase revenue by growing our market share in India to 8% by January of next year.
• If an imperative is unclear, ask the stakeholder for more detail.
• Understand how key stakeholders evaluate, direct, and monitor their own areas of the business; this will give you insight as to their style.

Receive final sign-off to proceed with developing the IT governance redesign

Document any project assumptions or constraints. Before proceeding with the IT governance activities, validate the statement of business context with senior stakeholders. When consensus has been reached, have them sign the final page of the document.

How to ensure sign-off:

• Schedule a meeting with the senior stakeholders and conduct a review of the document. This meeting presents a great opportunity to deliver your interpretation of management expectations and make any modifications.
• Obtaining stakeholder approval in person ensures there is no miscommunication or misunderstandings around the tasks that need to be accomplished to develop a successful IT governance.
• This is an iterative process; if senior stakeholders have concerns over certain aspects of the document, revise and review again.
• Final sign-off should only take place when mutual understanding has been reached.

Download the SoBC Template and complete for final approval.

Info-Tech Tip

In most circumstances, you should have the SoBC validated with the following stakeholders:

• CIO
• CEO
• CFO
• Business Unit Leaders

Understand the business context to set the foundation for governance redesign

CASE STUDY

Industry: Healthcare
Source: Info-Tech

Challenge

The new business direction to become an integrator shifted focus to faster software iteration and on enabling integration and translation technologies, while moving away from creating complete, top-to-bottom IT solutions to be leveraged by clinicians and patients.

Internal to the IT organization, this created a different in perspective on what was important to prioritize: foundational elements, web services, development, or data compliance issues. There was no longer agreement on which initiatives should move forward.

Solution

A series of mandatory meetings were held with key decision makers and SMEs within the organization in order to re-orient everyone on the overall purpose, goals, and outcomes of the organization.

All attendees were asked to identify what they saw as the mission and vision of the organization.

Finally, clinicians and patient representatives were brought in to describe how they were going to use the services the organization was providing and how it would enable better patient outcomes.

Results

Identifying the purpose of the work the IT organization was doing and how the services were going to be used realigned the different perspectives in the context of the healthcare outcomes they enabled.

This activity provided a unifying view of the purpose and the state of the business. Understanding the business context prepared the organization to move forward with the governance redesign.

If you want additional support, have our analysts guide you through this phase as part of an Info-Tech Workshop

Book a workshop with our Info-Tech analysts:

To accelerate this project, engage your IT team in an Info-Tech workshop with an Info-Tech analyst team. Info-Tech analyst will join you and your team onsite at your location or welcome you to Info-Tech's historic Toronto office to participate in an innovative onsite workshop. Contact your account manager (www.infotech.com/account), or email Workshops@InfoTech.com for more information.

The following are sample activities that will be conducted by Info-Tech analysts with your team:

1.1		Identify Relevant Stakeholders Build a list of relevant stakeholders and identify their position on the stakeholder power map.
1.4		Communication Plan Build customized communication plans to engage the key stakeholders in IT governance redesign.

If you want additional support, have our analysts guide you through this phase as part of an Info-Tech Workshop

Book a workshop with our Info-Tech analysts:

1.7		Gather Business Information Review business documents, leverage business analysis tools, and brainstorm with key executives to document the Statement of Business Context.
1.8		Finalize the Statement of Business Context Get final approval and acceptance on the Statement of Business Context that will guide your redesign.

Improve IT Governance to Drive Business Results

PHASE 2

Assess the Current Governance Framework

Phase 2 outline

Call 1-888-670-8889 or email GuidedImplementations@InfoTech.com for more information.

Complete these steps on your own, or call us to complete a guided implementation. A guided implementation is a series of 2-3 advisory calls that help you execute each phase of a project. They are included in most advisory memberships.

Guided Implementation 2: Assess the Current Governance Framework

Proposed Time to Completion: 2 weeks

Phase 2: Assess the Current Governance Framework

Activities:

• 2.1 Create Committee Profiles
• 2.2 Build a Governance Structure Map
• 2.3 Establish Governance Guidelines

Outcomes:

• Use the Current State Assessment of IT Governance to determine governance guidelines.

Info-Tech Insight

Don’t be passive; take action! Take an active approach to revising your governance framework. Understand why you are making decisions before actually making them.

Explore the current governance that exists within your organization

Your current governance framework will give you a strong understanding of the way the key stakeholders in your business currently view IT governance.

Leverage this understanding of IT governance to determine where governance is occurring and how it transpires.

Conduct a current state assessment

Use this tool to critically assess each governing body to determine the areas of improvement that are necessary in order to achieve optimal business results.

1. Identify All Governing Bodies
   Some bodies govern intentionally, and some govern through habit and practice. Outline all bodies that take on an element of governance.
2. Create a Governance Structure Map
   Configure the structural relationships for the governing bodies using the structure map.
3. Reveal Strengths and Weaknesses
   Identify the strengths and weaknesses of the governance structure, authority definitions, processes, and membership.
4. Establish Governance Guidelines
   Based on the SoBC, express clear and applicable guidelines to improve on the weaknesses while retaining the strengths of your governance framework.

Download the Current State Assessment of IT Governance to work toward these outcomes

Conduct a current state assessment to identify governance guidelines

How to use the Current State Assessment of IT Governance deliverable: Follow the steps below to create a cohesive understanding of the current state of IT governance and the challenges that the current system poses.

What makes up the “governance framework”?

There are four major elements of the governance framework:

1. Structure
   Structural relationships are shown by mapping the connections between committees.
2. Authority
   Each committee will have a purpose and area of decision making that it is accountable for.
3. Process
   The process includes the inputs, outputs, and activities required for the committee to function.
4. Membership The individuals or roles who sit on each committee. Take into account members’ knowledge, capability, and political influence.

Create governing board or committee profiles

Part A – Committee Profiles

1. Identify Governing Bodies

   Establish where governance happens and who is governing. For different organizations, the governance framework will contain a variety of governing bodies or people. Use a list format to identify governing bodies that exist in your organization.

2. Leverage Committee Templates

   Use the templates provided. Create a profile for each governing body that currently operates in your IT governance framework as listed in step 1.

3. Create Committee Profiles

   Identify what they are governing and how they are governing.
   Using the profiles created in step 2, identify each body’s membership roles, purpose, decision areas, inputs, and outputs. Refer to the example text in the template to guide you, but feel free to adjust the text to reflect the reality of your governing body.
   Consider the following domains of governance:
   (refer to Executive Brief)
   • Benefits realization
   • Risks
   • Resources
   Refer to our examples for some common governing bodies.

Consistently define the components of governance in the committee profiles

Membership

Membership Roles
Insert information here that reflects who the individuals are that sit on that governing body and what their role is. Include other important information about the individuals’ knowledge, skills, or capabilities that are relevant.

Authority

Purpose
Define why the committee was established in the first place.

Decision Areas
Explain the specific areas of decision making this group is responsible for overseeing.

Process

Inputs
Consider the information and materials that are needed to make decisions.

Outputs
Describe the outcomes of the committee. Think about decisions that were made through the governance process.

Map out relationships on the Governance Map

Part B – Structure Map

Structure

1. Assess Inputs and Outputs

   Governing Bodies	Inputs	Outputs
   Committee #1
   Committee #2
   Committee #3
   CFO
   IT Director
   CIO

   To understand relationships between governing bodies, list the inputs and outputs for each unique committee that rely on other committees in the table provided.
2. Create Structure Map
   Using the outline provided, create your own governance structure map to represent the way the governing bodies interact and feed into each other. This is crucial to ensure that the governing structure is streamlined. It will ensure that communication occurs efficiently and that there are no barriers to making decisions swiftly.

Outline the governance structure in the governance structure map

Identify strengths and weaknesses of the governance framework

Part C – Governance Guidelines

1. Choose Business State Template Choose the template that represents the identified future state of business in the Statement of Business Context.
2. Identify Strengths and Weaknesses Input the major strengths and weaknesses of your governance that were highlighted in the brainstorming activity.
3. Establish Governance Guidelines Draw your own implications from the strength and weaknesses that will drive the design of your governance in its future state. These guidelines should be concise and easy to implement. Note: Refer to the example guidelines in the Current State Assessment of IT Governance after you have considered your own specific guidelines. The examples are supplementary for your convenience.

Distinguish your business state from the others to ensure implications act as accurate guidelines

Business State Options

Identify strengths and weaknesses of the governance framework

2.3 2 hours

INSTRUCTIONS

1. Input Strengths of Governance
   Include useful components of the current framework; that may include elements that are operating well, fit the future state, or are required due to regulations or statutes.
2. Determine Weaknesses and Challenges
   Discuss the pain points of the current governance framework by looking through the lenses of structure, authority, process, or membership.

Consider:

• Where is governance not meeting expectations?
• Are we doing the right things?
• Are we getting the benefits?
• What are the outcomes?
• What do we want to achieve?
• How do we make intelligent decisions about what will help us achieve those outcomes?

Derive governance implications from strengths and weaknesses

2.3 2-4 hours

INSTRUCTIONS

1. Copy and paste your strengths and weaknesses from part B into the template that reflects your business state.
2. Draw your own implications from the strengths and weaknesses that will drive the design of your governance in its future state. These guidelines should be concise and practical.

Note: Use the examples of guidelines provided in the Current State Assessment of IT Governance to help formulate your own.

Conduct a current state assessment to identify guidelines for the future state of governance

CASE STUDY

Industry: Healthcare
Source: Anonymous

Challenge

Over time, the organization had to create a large amount of governing committees and subcommittees in order to comply with governance frameworks applied to them and to meet regulatory compliance requirements.

The current structure was no longer optimal to meet the newly identified mandate of the organization. However, the organization did not want to start from scratch and scrap the elements that worked, such as the dates and times that had been embedded into the organization.

Solution

A current state assessment was planned and executed in order to review what was currently being done and identify what could be retained and what should be added, changed, or removed to improve the governance outcomes.

The scope involved examining how current and near-term governance needs were, or were not, met through the existing structure, bodies, and their processes.

The organization investigated governance approaches of organizations with similar governance needs and with similar constraints to model their own.

Results

The outputs of this exercise included:

• A list of effective practices and committee guidelines that could be leveraged with little to no change in the future state.
• A list of opportunities to streamline the structure and processes.

These guidelines were used to drive recommendations for improvements to the governance structures and processes in the organization.

If you want additional support, have our analysts guide you through this phase as part of an Info-Tech Workshop

Book a workshop with our Info-Tech analysts:

To accelerate this project, engage your IT team in an Info-Tech workshop with an Info-Tech analyst team. Info-Tech analyst will join you and your team onsite at your location or welcome you to Info-Tech's historic Toronto office to participate in an innovative onsite workshop. Contact your account manager (www.infotech.com/account), or email Workshops@InfoTech.com for more information.

The following are sample activities that will be conducted by Info-Tech analysts with your team:

2.1		Create Current State Structure and Profiles Take the time to clearly articulate the current governance framework of your organization. Outline the structure and build the committee profiles for the governing bodies in your organization.
2.3		Determine Strengths, Weaknesses, and Guidelines Evaluate the strengths of your governance framework, the weaknesses that it exhibits, and the guidelines that will help maintain the strengths and alleviate the pains.

Improve IT Governance to Drive Business Results

PHASE 3

Redesign the Governance Framework

Phase 3 Guided Implementation

Call 1-888-670-8889 or email GuidedImplementations@InfoTech.com for more information.

Complete these steps on your own, or call us to complete a guided implementation. A guided implementation is a series of 2-3 advisory calls that help you execute each phase of a project. They are included in most advisory memberships.

Guided Implementation 3: Redesign the Governance Framework

Proposed Time to Completion: 4 weeks

Phase 3: Redesign the Governance Framework

Activities:

• 3.1 Build a Governance Structure Map
• 3.2 Create Committee Profiles
• 3.3 Leverage Process-Specific Governance Blueprints

Outcomes:

• Use the Future State Design for IT Governance template to build the optimal governance framework for your organization.

Info-Tech Insight

Keep the current and future goals in sight to build an optimized governance framework that maintains the minimum bar of oversight required.

Anticipate the outcomes of the Future State Design for IT Governance tool

Use this tool to guide your organization toward transformative outcomes gleaned from an optimized governance framework.

1. Implement Structural Guidelines
   Determine what governing bodies to add, change, or remove from your governance structure.
2. Create a Governance Structure Map
   Configure the structural relationships for the redesigned governing bodies using the structure map.
3. Build Effective Committees
   Use the IT Governance Terms of Reference to build profiles for each newly created committee and to alter any existing committees.
4. Determine Follow-up Governance Support
   Access external material on governance from other Info-Tech blueprints that will help with specific governance areas.

Download the Future State Design for IT Governance template to work toward these outcomes.

Use the Future State Design for IT Governance tool to create a custom governance framework for your organization

How to use the Future State Design for IT Governance deliverable: Follow the steps below to redesign the future state of IT governance. Use the guidelines to respond to challenges identified in the current governance framework based on the current state assessment.

Connect key learnings to initiate governance redesign

The future state design will reflect the state of business that was identified in Phase 1 along with the guidelines defined in Phase 2 to build a governance framework that promotes business-IT fusion.

Use structure and authority guidelines to build a new governance structure map

3A.1 Redesign the governance frameworks

Part A – Structure Map

Structure	Authority
1a. Structural Guidelines	1b. Authority Guidelines
Input the guidelines from the current state assessment to guide the redesign.
2. Leverage Guiding Questions Use the guiding questions provided to assess the needed changes.
Guiding Questions Do governing bodies operate at a tier that matches the guidelines?	Do governing bodies focus on the decisions that align with the guidelines?
Build the “where/why” of governance. Consider at what tier each committee will reside and what area of governance will be part of its domain. Modify the current structure; do not start from scratch.
3. Add / Change (Tier/Authority) / Remove
Determine changes to structure or authority that will be occurring for each of the current governing bodies. Work within the current structure as much as possible.
4. Use the Structure Map to Show Redesign
Create your own governance structure map to represent the way the governing bodies interact and feed into each other.

Maintain as much of the existing framework as possible in the redesign

3.1 2-4 hours

Future State Design

• Structure
• Authority

Info-Tech Best Practice

Keep the number of added or removed committees as low as possible, while still optimizing. The less change to the structure, the easier it will be to implement.

Refer to the example to help guide your committee redesign.

Determine:
1. Do the guidelines impact committees you already have? Will you have to modify the tier or the authority of those committees?
2. Do the guidelines require you to build a new committee to meet needs?
3. Do the guidelines require you to remove a committee that isn’t necessary?

Outline the new governance structure in the governance structure map in the Future State Design for IT Governance tool

Use process and membership guidelines along with the IT Governance Terms of Reference to build committees

Part B – Committee Profiles

Process	Membership
1a. Process Guidelines	1b. Authority Guidelines
Input the guidelines from the current state assessment to guide the redesign.
2. Leverage Guiding Questions Use the guiding questions provided to assess the needed changes.
Guiding Questions Do the process inputs and outputs reflect the structure and authority guidelines?	Do governing bodies engage the right people who have the roles, capacity, and knowledge to govern?
Build the “what/how” of governance. Build out the process and procedures that each committee will use.
3. Adapt / Refine Governing Body Profiles Using your customized guidelines, create a profile for each committee.
We have provided templates for some common committees. To make these committee profiles reflective of your organization, use the information you have gathered in your Current State Assessment of IT Governance guidelines. For a more detailed approach to building out specific charters for each committee refer to the IT Governance Terms of Reference.

Use the IT Governance Terms of Reference to establish operational procedures for governing bodies

3.2 3-6 hours

Future State Design

• Process
• Membership

Info-Tech Best Practice

The people on the committee matter. Governance committee membership does not have to correspond with the organizational structure, but it should correspond with the purpose and decision areas of the governance structure.

Refer to the example to help guide your committee redesign.

Determine:
1. Do the guidelines alter the members needed to achieve the outcomes?
2. Do the guidelines change the purpose and decision areas of the committee?
3. How do the new structure’s guidelines impact the inputs and outputs of the governing body?

Add depth to the committee profiles using the IT Governance Terms of Reference

Refer to the sections outlined below to build a committee charter for your governance committees. Four examples are provided in the tool and can be edited for your convenience. They are: Executive Management Committee, IT Steering Committee, Portfolio Review Board, and Risk and Compliance Committee.

1. Purpose
2. Goals
3. Responsibilities
4. Committee Members
5. RACI
6. Procedures
7. Agenda

Be sure to embed the domains of governance in the charters so that committees focus on the appropriate elements of benefits realization, risk optimization, and resource optimization.

Download the IT Governance Terms of Reference for more in-depth committee charters.

Three pillars of planning effective governance meetings

The effectiveness of the governance is reliant on the ability to work within operational dependencies that will exist in the governance framework. Consider these questions to guide the duration, frequency, and sequencing of your governing body meetings.

Frequency What is the quantity of decisions that must be made? Is a rapid or urgent response typically required? Duration How long should your meeting run based on your meeting frequency and the volume of work to be accomplished? Sequencing Are there other decisions that rely on the outcomes of this meeting? Are there any decisions that must be made first for others to occur?

Leverage process-specific governance blueprints

If there are specific areas of IT governance that you require further support on, refer to Info-Tech’s library of DIY blueprints, Guided Implementations, and workshops for further support. We cover IT governance in the following areas:

Enterprise Architecture Governance	Service Portfolio Governance	Security Governance

Consider the challenges and solutions when identifying a multi-state reality for your business state

A multi-state business will face unique challenges in navigating the redesign process with the goal of combining all related business states in governance.

1. Divergent Governance Models
   Separate the governance groups that need to function differently, and bring them back together at the highest level.
2. Reflecting the Organizational Structure
   Unlike single-state governance, multi-state organizations should model the governance framework in reflection of the organizational structure.
3. Combining Implications
   Prioritize which implications are the most important and make sure they work first, then see what else fits (e.g. start with regulation, then insert lean guidelines).

The multi-state business will not fit into one “box” – consider implications from the overlapping business states.

As business needs change, ensure that you establish triggers to reassess the design of your governance framework.

Leverage the outcomes of the Current State Assessment and Statement of Business Context to build the future state

CASE STUDY

Industry: Healthcare
Source: Info-Tech

Challenge

Identifying the committees and processes that should be in place in the target state required a lot of different inputs.

A number of high-profile senior management team members were still resistant to the overall idea of applying governance to their initiatives since they were clinician driven.

The approach and target state, including the implementation plan, had to be approved and built out.

Solution

The information pulled together from the current state assessment, including best practices and jurisdictional scans, were tied together with the updated mandate and future state, and a list of recommended improvements were documented.

The improvements were presented to the optimization committee and the governance committee members to ensure agreement on the approach and confirm the timeline for agreed improvements.

Results

A future state mapping of the new committee structure was created, as well as the revised membership requirements, responsibilities, and terms of reference.

The approved recommendations were prioritized and turned into an implementation plan, with each improvement being assigned an owner who would be responsible for driving the effort to completion.

Integration points in other processes, like SDLC, where change would be required were highlighted and included in the implementation plan.

If you want additional support, have our analysts guide you through this phase as part of an Info-Tech Workshop

Book a workshop with our Info-Tech analysts:

To accelerate this project, engage your IT team in an Info-Tech workshop with an Info-Tech analyst team. Info-Tech analyst will join you and your team onsite at your location or welcome you to Info-Tech's historic Toronto office to participate in an innovative onsite workshop. Contact your account manager (www.infotech.com/account), or email Workshops@InfoTech.com for more information.

The following are sample activities that will be conducted by Info-Tech analysts with your team:

3.1		Redesign the Governance Structure Identify committees that need to be added, ones that must be changed, and the no-longer-needed governing bodies in an optimized and streamlined structure. Draw it out in the governance structure map.
3.2		Redesign the Governing Bodies Use the IT Governance Terms of Reference and the Committee Template to build a committee profile for each governing body identified. Use these activities to build out and establish the processes of the modified governing groups.

Improve IT Governance to Drive Business Results

PHASE 4

Implement Governance Redesign

Phase 4 outline

Call 1-888-670-8889 or email GuidedImplementations@InfoTech.com for more information.

Complete these steps on your own, or call us to complete a guided implementation. A guided implementation is a series of 2-3 advisory calls that help you execute each phase of a project. They are included in most advisory memberships.

Guided Implementation 4: Implement Governance Redesign

Proposed Time to Completion: 2-3 weeks

Phase 4: Implement Governance Redesign

Activities:

• 4.1 Identify Next Steps for the Redesign
• 4.2 Establish a Communication Plan
• 4.3 Lead the Executive Presentation

Outcomes:

• Rationalize steps in the Implementation Plan tool.
• Construct an executive presentation to facilitate transparency for the governing framework.

Anticipate and overcome implementation obstacles for the redesign

Often high-level organizational changes create challenges. We will help you break down the barriers to optimal IT governance by addressing key obstacles.

Info-Tech Insight

Don’t overlook the politics and culture of your organization while redesigning your governance framework.

Create an implementation roadmap to organize a plan for the redesign

4A Create an implementation and communication plan

INSTRUCTIONS

1. Identify Tasks
   Decide on the order of tasks for your implementation plan. Consider the dependencies of actions and plan the sequence accordingly.
2. Determine Communication Method
   Identify the most appropriate and impactful method of communicating at each milestone identified in step 1.

Download the IT Governance Implementation Plan to organize your customized implementation and communication plan.

Outline next steps for governance redesign

4.1

INPUT: Tasks Identified in the Future State Design

OUTPUT: Identified Tasks for Implementation as Well as the Audience

Materials: N/A

Participants: IT Governance Redesign Owner

INSTRUCTIONS

Keep these questions in mind as you analyze and assess what steps to take first in the redesign implementation.

1. What needs to happen?
   Use the identified changes from the redesign as your guiding list of tasks that need to occur. If they are larger tasks, break them down into smaller parts to make the milestones more achievable.
2. What are the dependencies?
   Throughout the implementation of the redesign, certain tasks will need to occur to enable other tasks to be performed. Make sure to clearly identify what dependencies exist in the implementation process and clearly identify the order of the tasks.
3. Who do the changes impact?
   Consider the groups and individuals that will be impacted by changes to the governance framework. This includes key business stakeholders, IT leaders, members of governing boards, and anyone who provides an input or requires an output from one of the committees.

Use a big-bang approach to implement the IT governance redesign

While there are other methods to implementing change, the big-bang approach is the most effective for governance redesign and will maintain the momentum of the change as well as the support needed to make it successful.

Phased	Parallel	Big Bang
Implementation of redesign occurs in steps over a significant period of time.	Components of the redesign are brought into the governance framework, while maintaining some of the old components.	Implementation of redesign occurs all at once. This requires significant preparation.
Some committees will be operating under a new structure while others are not, which will undermine the changes being made. This method proliferates a lack of transparency and trust.	Releasing IT governance in parallel leads to members sitting on too many boards and spending too much time on governance. There will be a lack of clarity on a committee’s authority.	This approach will lead to consistency and transparency in the new process. The change will be clear and fully embedded in the organization with stronger boundaries and well-defined expectations.

Determine the most effective and impactful communication mediums for relevant stakeholders

4.2 1 hour

INSTRUCTIONS

1. Consider the Individual or Group
   Consider the group and individuals identified in step 4.1. Determine the most appropriate mechanism for communicating with that person or group. Keep in mind: If they are local, how much influence they have and if they are already engaged in the redesign process.
2. Consider the Message
   The type of message that you are communicating will vary in impact and importance depending on the task. Make sure that the communication medium reflects your message. Keep in mind: If the you are communicating an important or more personal issue, the medium should be more personal as well.

Communicate the changes that result from the redesign

Plan the message first, then deliver it to your stakeholders through the most appropriate medium to avoid message avoidance or confusion.

Communication Medium

Face-to-Face Communication

Face-to-face communication helps to ensure that the audience is receiving and understanding a clear message, and allows them to voice their concerns and clarify any confusion or questions.

• Use one-on-one meetings for key stakeholders and large organizational meetings to introduce large changes in the redesign.

Emails

Use email to communicate information to broad audiences. In addition, use email as the mass feedback mechanism.

• Use email to follow up on meetings, or to invite people to next ones, but not as the sole medium of communication.

Internal Website or Drive

Use an internal website or drive as an information repository.

• Store meeting minutes, policies, procedures, terms of reference, and feedback online to ensure transparency.

Message Delivery

1. Plan Your Message
   Emphasize what the audience really needs to know and how the change will impact them.
2. Test Your Message
   If possible, test your communications with a small audience (2-3 people) first to get feedback and adjust messages before delivering them more broadly.
3. Deliver and Repeat Your Message
   “Tell them what you’re going to tell them, then tell them, then tell them what you told them.”
4. Gather Feedback and Evaluate Communications
   Evaluate the effectiveness of the communications (through surveys, stakeholder interviews, or metrics) to ensure the message was delivered and received successfully and communication goals were met.

Construct an executive presentation to facilitate transparency for the governing framework

4B Present the redesign to the key business stakeholders

INSTRUCTIONS

1. Identify Stakeholders
   Determine which business stakeholders have been the most involved in the redesign process.
2. Customize Presentation
   Use the deliverables that you have built throughout this redesign to communicate the changes to the structure, authority, processes, and memberships in the governance framework.
3. Present to Executives
   Present the executive presentation to the key business stakeholders who have been involved in the redesign process.

Info-Tech best Practice

Use the Executive Presentation customizable deliverable to lead a boardroom-quality presentation outlining the process and outcomes of the IT governance redesign.

Present the executive presentation

4.3 1 hour

INSTRUCTIONS

1. Input SoBC Outcomes
   Input the outcomes of the SoBC. Specify the state of the business you have identified through the process of Phase 1.
2. Input Current State Framework and Guidelines
   Input the outcomes of the current state assessment. Explain the process you used to identify the current governance framework and how you determined the strengths, weaknesses, and guidelines.
3. Input Redesigned Governance Framework
   Input the governance redesign outcomes. Explain the process you used to modify and reconstruct the governance framework to drive optimal business results. Show the new structure and committee profiles.

Use the Redesign IT Governance to Drive Optimal Business Results Executive Presentation Template for more information.

Implement the governance redesign to optimize governance and, in turn, business results

CASE STUDY

Industry: Healthcare
Source: Info-Tech

Challenge

Members of the project management group and in the larger SDLC process identified a lack of clarity on how to best govern active projects and initiatives that were moving through the governance process during the changes to the governance framework.

These projects had already begun under the old frameworks and applying the redesigned governance framework would lead to work duplication and wasted time.

Solution

The organization decided that instead of applying the redesign to all initiatives across the organization, it would only be applied to new initiatives and ones that were still working within the first part of the “gating” process, where revised intake information could still be provided.

Active initiatives that fell into the grandfathered category were identified and could proceed based on the old process. Yet, those that did not receive this status were provided carry-over lead time to revise their documentation during the changes.

Results

The implementation plan and timeframes were approved and an official change-over date identified.

A communication plan was provided, including the grandfathered approach to be used with in-flight initiatives.

A review cycle was also established for three months after launch to ensure the process was working as expected and would be repeated annually.

The revised process improved the cycle time by 30% and improved the ability of the organization to govern high-speed requests and decisions.

Summary of accomplishment

Insights

• IT governance requires business leadership.
  Instead of IT managing and governing IT, engage business leaders to take responsibility for governing IT.
• With great governance comes great responsibility.
  Involve relevant business leaders, who will be impacted by IT outcomes, to share governing authority of IT.
• Establish IT-business fusion.
  In governance, alignment is not enough. Merge IT and the business through governance to ensure business success.

Knowledge Gained

• There must be an active understanding of the current and future state of the business for governance to address the changing needs of the business.
• Take a proactive approach to revising your governance framework. Understand why you are making decisions before actually making them.
• Keep the current and future goals in sight to build an optimized governance framework that maintains the minimum bar of oversight required.

Processes Optimized

• EDM01 – Establishing a Governance Framework
• Understanding the four elements of governance:
  • Structure
  • Authority
  • Process
  • Members
• Embedding the benefits realization criteria, risk optimization, and resource optimization in governance.

Deliverables Completed

• Statement of Business Context
• Current State Assessment of IT Governance
• Future State Design for IT Governance
• IT Governance Implementation Plan

If you want additional support, have our analysts guide you through this phase as part of an Info-Tech Workshop

Book a workshop with our Info-Tech analysts:

To accelerate this project, engage your IT team in an Info-Tech workshop with an Info-Tech analyst team. Info-Tech analyst will join you and your team onsite at your location or welcome you to Info-Tech's historic Toronto office to participate in an innovative onsite workshop. Contact your account manager (www.infotech.com/account), or email Workshops@InfoTech.com for more information.

The following are sample activities that will be conducted by Info-Tech analysts with your team:

4.1		Build and Deploy the Implementation Plan Construct a list of tasks and consider the individuals or groups that those tasks will impact when implementing the governance redesign. Ensure consistent and transparent communication for successful outcomes.
4.3		Build the Executive Presentation Insert the state of business, current state, and future state design outcomes into a presentation to inform the key business stakeholders on the process and outcomes of the governance redesign.

Research contributors and experts

Deborah Eyzaguirre, IT Business Relationship Manager, UNT System

Herbert Kraft, MIS Manager, Prairie Knights Casino

Roslyn Kaman, CFO, Miles Nadal JCC

Nicole Haggerty, Associate Professor of Information Systems, Ivey Business School

Chris Austin, CTO, Ivey Business School

Adriana Callerio, IT Director Performance Management, Molina Healthcare Inc.

Joe Evers, Consulting Principal, JcEvers Consulting Corp

Huw Morgan, IT Research Executive

Joy Thiele, Special Projects Manager, Dunns Creek Baptist Church

Rick Daoust, CIO, Cambrian College

Related Info-Tech Research

• Establish an Effective IT Steering Committee
  Have the right people making the right decisions to drive IT success.

Bibliography

A.T. Kearney. “The 7 Habits of Highly Effective Governance.” A.T. Kearney, 2008. Web. Nov. 2016.

Bertolini, Phil. “The Transformational Effect of IT Governance.” Government Finance Review, Dec. 2012. Web. Nov. 2016.

CGI. “IT Governance and Managed Services – Creative a win-win relationship” CGI Group Inc., 2015. Web. Dec. 2016.

De Haes, Steven, and Wim Van Grembergen. “An Exploratory Study into the Design of an IT Governance Minimum Baseline through Delphi Research.” Communications of the Association for Information Systems: Vol. 22 , Article 24. 2008. Web. Nov. 2016.

Deloitte LLP. “The Role of Senior Leaders in IT Governance.” The Wall Street Journal, 22 Jun. 2015. Web. Oct. 2016.

Dragoon, Alice. “Four Governance Best Practices.” CIO From IDG, 15 Aug. 2003. Web. Dec. 2016.

du Preez, Gert. “Company Size Matters: Perspectives on IT Governance.” PricewaterhouseCoopers, Aug. 2011. Web. Nov. 2016.

Hagen, Christian, et. al. “Building a Capability-Driven IT Organization.” A.T. Kearney, Jun. 2011. Web. Nov. 2016.

Heller, Martha. “Five Best Practices for IT Governance.” CFO.com, 27 Aug. 2012. Web. Oct. 2016.

Hoch, Detlev, and Payan, Miguel. “Establishing Good IT Governance in the Public Sector.” McKinsey Dusseldorf, Mar. 2008. Web. Oct. 2016.

Horne, Andrew, and Brian Foster. “IT Governance Is Killing Innovation.” Harvard Business Review, 22 Aug. 2013. Web. Dec. 2016.

ISACA. “COBIT 5: Enabling Processes.” ISACA, 2012. Web. Oct. 2016.

IT Governance Institute. “An Executive View of IT Governance.” IT Governance Institute, in association with PricewaterhouseCoopers. 2009. Web. Nov. 2016.

Bibliography continued

IT Governance Institute. “IT Governance Roundtable: Defining IT Governance.” IT Governance Institute, 2009. Web. Nov. 2016.

Macgregor, Stuart. “The linchpin between Corporate Governance and IT Governance.” The Open Group’s EA Forum Johannesburg and Cape Town, Nov. 2013. Web. Nov. 2016.

Mallette, Debra. “Implementing IT Governance An Introduction.” ISACA San Francisco Chapter, 23 Sep. 2009. Web. Oct. 2016.

Massachusetts Institute of Technology. “IT Governance Introduction.” MIT Centre for Information System Research, 2016. Web. Nov. 2016.

Mueller, Lynn, et. al. “IBM IT Governance Approach – Business Performance through IT Execution.” IBM Redbooks, Feb. 2008. Web. Nov. 2016.

National Computing Centre. “IT Governance: Developing a successful governance strategy.” The National Computing Centre, Nov. 2005. Web. Oct. 2016.

Pittsburgh ISACA Chapter. “Practical Approach to COBIT 5.0.” Pittsburgh ISACA Chapter, 17 Sep. 2012. Web. Nov. 2016.

PricewaterhouseCoopers. “Great by governance: Improve IT performance and Value While Managing Risks.” PricewaterhouseCoopers, Nov. 2014. Web. Dec. 2016.

PricewaterhouseCoopers. “IT Governance in Practice: Insights from leading CIOs.” PricewaterhouseCoopers, 2006. Web. Nov. 2016.

Routh, Richard L. “IT Governance Part 1 of 2.” Online video clip. YouTube. The Institute of CIO Excellence, 01 Aug. 2012. Web. Nov. 2016.

Salleh, Noor Akma Mohd, et. al. “IT Governance in Airline Industry: A Multiple Case Study.” International Journal of Digital Society, Dec. 2010. Web. Nov. 2016.

Bibliography continued

Speckert, Thomas, et. al. “IT Governance in Organizations Facing Decentralization – Case Study in Higher Education.” Department of Computer and Systems Sciences. Stockholm University, 2014. Web. Nov. 2016.

Thorp, John. The Information Paradox—Realizing the Business Benefits of Information Technology. Revised Edition, McGraw Hill, 2003 (written jointly with Fujitsu).

Vandervost, Guido, et. al. “IT Governance for the CxO.” Deloitte, Nov. 2013. Web. Nov. 2016.

Weill, Peter, and Jeanne W. Ross. “IT Governance: How Top Performers Manage IT Decision Rights for Superior Results.” Boston: Harvard Business School, 2004. Print. Oct. 2016.

Wong, Daron, et. al. “IT Governance in Oil and Gas: CIO Roundtable, Priorities for Surviving and Thriving in Lean Times.” Online video clip. YouTube. IT Media Group, Jun. 2016. Web. Nov. 2016.

Establish a Sustainable ESG Reporting Program

Strengthen corporate performance by implementing a holistic and proactive reporting approach.

Analyst Perspective

The shift toward stakeholder capitalism cannot be pinned on one thing; rather, it is a convergence of forces that has reshaped attitudes toward the corporation. Investor attention on responsible investing has pushed corporations to give greater weight to the achievement of corporate goals beyond financial performance.

Reacting to the new investor paradigm and to the wider systemic risk to the financial system of climate change, global regulators have rapidly mobilized toward mandatory climate-related disclosure.

IT will be instrumental in meeting the immediate regulatory mandate, but their role is much more far-reaching. IT has a role to play at the leadership table shaping strategy and assisting the organization to deliver on purpose-driven goals.

Delivering high-quality, relevant, and consistent disclosure is the key to unlocking and driving sustainable corporate performance. IT leaders should not underestimate the influence they have in selecting the right technology and data model to support ESG reporting and ultimately support top-line growth.

Yaz Palanichamy
Senior Research Analyst
Info-Tech Research Group

Donna Bales
Principal Research Director
Info-Tech Research Group

Executive Summary

Info-Tech Insight

Implementing a robust reporting program takes time. Start early, remain focused, and plan to continually improve data quality and collection and performance metrics

Putting “E,” “S,” and “G” in context

Corporate sustainability depends on managing ESG factors well

Environmental, social, and governance are the components of a sustainability framework that is used to understand and measure how an organization impacts or is affected by society as a whole.

Human activities, particularly fossil fuel burning since the middle of the twentieth century, have increased greenhouse gas concentration, resulting in observable changes to the atmosphere, ocean, cryosphere, and biosphere. The “E” in ESG relates to the positive and negative impacts an organization may have on the environment, such as the energy it takes in and the waste it discharges.

The “S” in ESG is the most ambiguous component in the framework, as social impact relates not only to risks but also to prosocial behavior. It’s the most difficult to measure but can have significant financial and reputational impact on corporations if material and poorly managed.

The “G” in ESG is foundational to the realization of “S” and “E.” It encompasses how well an organization integrates these considerations into the business and how well the organization engages with key stakeholders, receives feedback, and is transparent with its intentions.

The impact of ESG factors on investment decisions

Alleviate Investment Risk

Organizational Reputation: Seventy-four percent of those surveyed were concerned that failing to improve their corporate ESG performance would negatively impact their organization’s branding and overall reputation in the market (Intelex, 2022).

Ethical Business Compliance: Adherence to well-defined codes of business conduct and implementation of anti-corruption and anti-bribery practices is a great way to distinguish between organizations with good/poor governance intentions.

Shifting Consumer Preferences: ESG metrics can also largely influence consumer preferences in buying behavior intentions. Research from McKinsey shows that “upward of 70 percent” of consumers surveyed on purchases in multiple industries said they would pay an additional 5 percent for a green product if it met the same performance standards as a nongreen alternative (McKinsey, 2019).

Responsible Supply Chain Management: The successful alignment of ESG criteria with supply chain operations can lead to several benefits (e.g. producing more sustainable product offerings, maintaining constructive relationships with more sustainability-focused suppliers).

Environmental Stewardship: The growing climate crisis has forced companies of all sizes to rethink how they plan their corporate environmental sustainability practices.

Compliance With Regulatory Guidelines: An increasing emphasis on regulations surrounding ESG disclosure rates may result in some institutional investors taking a more proactive stance toward ESG-related initiatives.

Sustaining Competitive Advantage: Given today’s globalized economy, many businesses are constantly confronted with environmental issues (e.g. water scarcity, air pollution) as well as social problems (e.g. workplace wellness issues). Thus, investment in ESG factors is simply a part of maintaining competitive advantage.

Leaders increasingly see ESG as a competitive differentiator

The perceived importance of ESG has dramatically increased from 2020 to 2023

In a survey commissioned by Schneider Electric, researchers categorized the relative importance of ESG planning initiatives for global IT business leaders. ESG was largely identified as a critical factor in sustaining competitive advantage against competitors and maintaining positive investor/public relations.
Source: S&P Market Intelligence, 2020; N=825 IT decision makers

“74% of finance leaders say investors increasingly use nonfinancial information in their decision-making.”
Source: EY, 2020

Regulatory pressure to report on carbon emission is building globally

The Evolving Regulatory Landscape

Canada

• Canadian Securities Administrators (CSA) NI 51-107 Disclosure of Climate-related Matters

United States

• Securities and Exchange Commission (SEC) 33-11042 – The Enhancement and Standardization of Climate-Related Disclosures for Investors
• SEC 33-11038 Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure
• Nasdaq Board Diversity Rule (5605(f))

Europe

• European Commission Sustainable Finance Disclosure Regulation (SFDR)
• European Commission EU Supply Chain Act
• The German Supply Chain Act (GSCA)
• Financial Conduct Authority UK Proposal (DP 21/4) Sustainability Disclosure Requirements and investment labels
• UK Modern Slavery Act, 2015

New Zealand

• The Financial Sector (Climate-related Disclosures and Other Matters) Amendment Act 2021

Accurate ESG reporting will be critical to meet regulatory requirements

ESG reporting is the disclosure of environmental, social, and governance (ESG) data via qualitative and quantitative reports.

It is how organizations make their sustainability commitments and strategies transparent to stakeholders.

For investors it provides visibility into a company's ESG activities, enabling them to align investments to their values and avoid companies that cause damage to the environment or are offside on social and governance issues.

Despite the growing practice of ESG reporting, reporting standards and frameworks are still evolving and the regulatory approach for climate-related disclosure is inconsistent across jurisdictions, making it challenging for organizations to develop a robust reporting program.

However, organizations will struggle to meet reporting requirements

Despite the commitment to support an ESG Initiative, less than a quarter of IT professionals say their organization can accurately report on the impact of its ESG initiatives, and 44% say their reporting on impacts is not accurate.

Reporting accuracy was even worse for reporting on carbon footprint with 46% saying their organization could not report on its carbon footprint accurately. This despite most IT professionals saying they are working to support environmental mandates.

Global sustainability rankings based on ESG dimensions

Global Country Sustainability Ranking Map

Country Sustainability Scores (CSR) as of October 2021
Scores range from 1 (poor) to 10 (best)
Source: Robeco, 2021

ESG Performance Rankings From Select Countries

Top ESG and sustainability performer

Finland has ranked consistently as a leading sustainability performer in recent years. Finland's strongest ESG pillar is the environment, and its environmental ranking of 9.63/10 is the highest out of all 150 countries.

Significant score deteriorations

Brazil, France, and India are among the countries whose ESG score rankings have deteriorated significantly in the past three years.

Increasing political tensions and risks as well as aftershock effects of the COVID-19 pandemic (e.g. high inequality and insufficient access to healthcare and education) have severely impacted Brazil’s performance across the governance and social pillars of the ESG framework, ultimately causing its overall ESG score to drop to a CSR value of 5.31.

Largest gains and losses in ESG scores

Canada has received worse scores for corruption, political risk, income inequality, and poverty over the past three years.

Taiwan has seen its rankings improve in terms of overall ESG scores. Government effectiveness, innovation, a strong semiconductor manufacturing market presence, and stronger governance initiatives have been sufficient to compensate for a setback in income and economic inequality.

Source: Robeco, 2021

Establish a Sustainable Environmental, Social, and Governance (ESG) Reporting Program

Blueprint benefits

Business Benefits

• Clarity on technical and organizational gaps in the organization’s ability to deliver ESG reporting strategy.
• Transparency on the breadth of the change program, internal capabilities needed, and accountable owners.
• Reduced likelihood of liability.
• Improved corporate performance and top-line growth.
• Confidence that the organization is delivering high-quality, comprehensive ESG disclosure.

IT Benefits

• Understanding of IT’s role as strategic enabler for delivering high-quality ESG disclosure and sustainable corporate performance.
• Transparency on primary data gaps and technology and tools needed to support the ESG reporting strategy.
• Clear direction of material ESG risks and how to prioritize implementation efforts.
• Awareness of tool selection options.

Blueprint deliverables

Each step of this blueprint is accompanied by supporting deliverables to help you accomplish your goals:

Info-Tech offers various levels of support to best suit your needs

DIY Toolkit
"Our team has already made this critical project a priority, and we have the time and capability, but some guidance along the way would be helpful."

Guided Implementation
"Our team knows that we need to fix a process, but we need assistance to determine where to focus. Some check-ins along the way would help keep us on track."

Workshop
"We need to hit the ground running and get this project kicked off immediately. Our team has the ability to take this over once we get a framework and strategy in place."

Consulting
"Our team does not have the time or the knowledge to take this project on. We need assistance through the entirety of this project."

Diagnostics and consistent frameworks are used throughout all four options.

Guided Implementation

A Guided Implementation (GI) is a series of calls with an Info-Tech analyst to help implement our best practices in your organization.

A typical GI is 8 to 12 calls over the course of 4 to 6 months.

What does a typical GI on this topic look like?

Workshop Overview

Contact your account representative for more information.
workshops@infotech.com
1-888-670-8889

Phase 1

Explore ESG Reporting

This phase will walk you through the following:

• Define key stakeholders and material ESG factors.
• Identify material ESG issues.
• Develop SMART program metrics.
• List reporting obligations.
• Surface high-level data gaps.
• Record high-level implementation considerations.

This phase involves the following participants: CIO, CCO, CSO, business leaders, legal, marketing and communications, head of ESG reporting, and any dedicated ESG team members

Practical steps for ESG disclosure

Measuring and tracking incremental change among dimensions such as carbon emissions reporting, governance, and diversity, equity, and inclusion (DEI) requires organizations to acquire, analyze, and synthesize data from beyond their internal organizational ecosystems

1.1 Ensure your reporting requirements are comprehensive

This section will walk you through some key considerations for establishing your ESG reporting strategy. The first step in this process is to identify the scope of your reporting program.

Defining the scope of your reporting program

1. Stakeholder requirements: When developing a reporting program consider all your stakeholder needs as well as how they want to consume the information.
2. Materiality assessment: Conduct a materiality assessment to identify the material ESG issues most critical to your organization. Organizations will need to report material risks to internal and external stakeholders.
3. Purpose-driven goals: Your ESG reporting must include metrics to measure performance against your purpose-driven strategy.
4. Regulatory requirements & industry: Work with your compliance and legal teams to understand which reporting requirements apply. Don’t forget requirements under the “S” and “G” components. Some jurisdictions require DEI reporting, and the Securities and Exchange Commission (SEC) in the US recently announced cybersecurity disclosure of board expertise and management oversight practices.

Factor 1: Stakeholder requirements

Work with key stakeholders to determine what to report

Evaluate your stakeholder landscape

Consider each of these areas of the ESG Stakeholder Wheel and identify your stakeholders. Once stakeholders are identified, consider how the ESG factors might be perceived by delving into the ESG factors that matter to each stakeholder and what drives their behavior.

Determine ESG impact on stakeholders

Review materiality assessment frameworks for your industry to surface ESG factors for your segment and stakeholder group(s).

Perform research and analysis of the competition and stakeholder trends, patterns, and behavior

Support your findings with stakeholder interviews.

Stakeholders will prioritize ESG differently. Understanding their commitment is a critical success factor.

Many of your stakeholders care about ESG commitments…

27%: Support for social and environmental proposals at shareholder meetings of US companies rose to 27% in 2020 (up from 21% in 2017).
Source: Sustainable Investments Institute, 2020.

79%: of investors consider ESG risks and opportunities an important factor in investment decision making.
Source: “Global Investor Survey,” PwC, 2021.

...Yet

33%: of survey respondents cited that a lack of attention or support from senior leadership was one of the major barriers preventing their companies from making any progress on ESG issues.
Source: “Consumer Intelligence Survey,” PwC, 2021.

Info-Tech Insight

To succeed with ESG reporting it is essential to understand who we hold ourselves accountable to and to focus ESG efforts in areas with the optimal balance between people, the planet, and profits

Activity 1: Define stakeholders

Input: Internal documentation (e.g. strategy, annual reports), ESG Stakeholder Wheel
Output: List of key stakeholders and applicable ESG factors
Materials: Whiteboard/flip charts, ESG Reporting Workbook
Participants: Chief Sustainability Officer, Chief Compliance Officer, Head of ESG Reporting, Business leaders

2 hours

1. Using the ESG Stakeholder Wheel as a baseline, consider the breadth of your organization’s value chain and write down all your stakeholders.
2. Discuss what drives their behavior. Be as detailed as you can be. For example, if it’s a consumer, delve into their age group and the factors that may drive their behavior.
3. List the ESG factors that may be important to each stakeholder.
4. Write down the communication channels you expect to use to communicate ESG information to this stakeholder group.
5. Rate the priority of this stakeholder to your organization.
6. Record this information in ESG Reporting Workbook.
7. Optional – consider testing the results with a targeted survey.

Download the ESG Reporting Workbook

Activity 1: Example

Factor 2: Materiality assessments

Conduct a materiality assessment to inform company strategy and establish targets and metrics for risk and performance reporting

The concept of materiality as it relates to ESG is the process of gaining different perspectives on ESG issues and risks that may have significant impact (both positive and negative) on or relevance to company performance.

The objective of a materiality assessment is to identify material ESG issues most critical to your organization by looking at a broad range of social and environmental factors. Its purpose is to narrow strategic focus and enable an organization to assess the impact of financial and non-financial risks aggregately.

It helps to make the case for ESG action and strategy, assess financial impact, get ahead of long-term risks, and inform communication strategies.

Organizations can use assessment tools from Sustainalytics or GRI, SASB Standards, or guidance and benchmarking information from industry associations to help assess ESG risks .

Info-Tech Insight

The materiality assessment informs your risk management approach. Material ESG risks identified should be integrated into your organization’s risk reporting framework.

Supplement your materiality assessment with stakeholder interviews

Steps to determine material ESG factors

Materiality assessment

The materiality assessment is a strategic tool used to help identify, refine, and assess the numerous ESG issues in the context of your organization.

There is no universally accepted approach to materiality assessments. Although the concept of materiality is often embedded within a reporting standard, your approach to conducting the materiality assessment does not need to link to a specific reporting standard. Rather, it can be used as a baseline to develop your own.

To arrive at the appropriate outcome for your organization, careful consideration is needed to tailor the materiality assessment to meet your organization’s objectives.

When defining the scope of your materiality assessment consider:

• Your corporate ESG purpose and sustainability strategy
• Your audience and what drives their behavior
• The relevance of the ESG issues to your organization. Do they impact strategy? Increase risk?
• The boundaries of your materiality assessment (e.g. regions or business departments, supply chains it will cover)
• Whether you want to assess from a double materiality perspective

Consider your stakeholders and your industry when selecting your materiality assessment tool – this will ensure you provide relevant disclosure information to the stakeholders that need it.

Double materiality is an extension of the financial concept of materiality and considers the broader impact of an organization on the world at large – particularly to people and climate.

Prioritize and categorize

Using internal information (e.g. strategy, surveys) and external information (e.g. competitors, industry best practices), create a longlist of ESG issues.

Discuss and narrow down the list. Be sure to consider opportunities – not just material risks!

Group the issues under ESG components or defined strategic goals for your organization. Another option is to use the UN’s Sustainable Development Goals to categorize.

Differentiate ESG factors that you already measure and report.

The benefit of clustering is that it shows related topics and how they may positively or negatively influence one another.

Internal risk disclosure should not be overlooked

Bank of America estimates ESG disputes have cost S&P companies more than $600 billion in market capitalization in the last seven years alone.

ESG risks are good predictors of future risks and are therefore key inputs to ensure long-term corporate success.

Regardless of the size of your organization, it’s important to build resilience against ESG risks.

To protect an organization against an ESG incident and potential liability risk, ESG risks should be treated like any other risk type and incorporated into risk management and internal reporting practices, including climate scenario analysis.

Some regulated entities will be required to meet climate-related financial disclosure expectations, and sound risk management practices will be prescribed through regulatory guidance. However, all organizations should instill sound risk practices.

ESG risk management done right will help protect against ESG mishaps that can be expensive and damaging while demonstrating commitment to stakeholders that have influence over all corporate performance.

Source: GreenBiz, 2022.

IT has a role to play to provide the underlying data and technology to support good risk decisions.

Visualize your material risks

Leverage industry frameworks or use Info-Tech’s materiality map to visualize your material ESG risks.

Activity 2: Materiality assessment

Input: ESG corporate purpose or any current ESG metrics; Customer satisfaction or employee engagement surveys; Materiality assessment tools from SASB, Sustainalytics, GRI, or industry frameworks; Outputs from stakeholder outreach/surveys
Output: Materiality map, a list of material ESG issues
Materials: Whiteboard/flip charts, ESG Reporting Workbook
Participants: Chief Sustainability Officer, Chief Compliance Officer, Head of ESG Reporting, Business leaders, Participants from marketing and communications

2-3 hour

1. Begin by reviewing various materiality assessment frameworks to agree on a baseline framework. This will help to narrow down a list of topics that are relevant to your company and industry.
2. As a group, discuss the potential impact and start listing material issues. At first the list will be long, but the group will work collectively to prioritize and consolidate the list.
3. Begin to combine and categorize the results by aligning them to your ESG purpose and strategic pillars.
4. Treat each ESG issue as a risk and map against the likelihood and impact of the risk.
5. Map the topics on your materiality map. Most of the materiality assessment tools have materiality maps – you may choose to use their map.
6. Record this information in the ESG Reporting Workbook.

Download the ESG Reporting Workbook

Case Study: Novartis

• INDUSTRY: Pharmaceuticals
• SOURCE: Novartis, 2022

Novartis, a leading global healthcare company based in Switzerland, stands out as a leader in providing medical consultancy services to address the evolving needs of patients worldwide. As such, its purpose is to use science and technologically innovative solutions to address some of society’s most debilitating, challenging, and ethically significant healthcare issues.

The application of Novartis’ materiality assessment process in understanding critical ESG topics important to their shareholders, stakeholder groups, and society at large enables the company to better quantify references to its ESG sustainability metrics.

Novartis applies its materiality assessment process to better understand relevant issues affecting its underlying business operations across its entire value chain. Overall, employing Novartis’s materiality assessment process helps the company to better manage its societal, environmental, and economic impacts, thus engaging in more socially responsible governance practices.

Novartis’ materiality assessment is a multitiered process that includes three major elements:

1. Identifying key stakeholders, which involves a holistic analysis of internal colleagues and external stakeholders.
2. Collecting quantitative feedback and asking relevant stakeholders to rank a set of issues (e.g. climate change governance, workplace culture, occupational health and safety) and rate how well Novartis performs across each of those identified issues.
3. Eliciting qualitative insights by coordinating interviews and workshops with survey participants to better understand why the issues brought up during survey sessions were perceived as important.

Results

In 2021, Novartis had completed its most recent materiality assessment. From this engagement, both internal and external stakeholders had ranked as important eight clusters that Novartis is impacting on from an economic, societal, and environmental standpoint. The top four clusters were patient health and safety, access to healthcare, innovation, and ethical business practices.

Factor 3: ESG program goals

Incorporate ESG performance metrics that support your ESG strategy

Another benefit of the materiality assessment is that it helps to make the case for ESG action and provides key information for developing a purpose-led strategy.

An internal ESG strategy should drive toward company-specific goals such as green-house gas emission targets, use of carbon neutral technologies, focus on reusable products, or investment in DEI programs.

Most organizations focus on incremental goals of reducing negative impacts to existing operations or improving the value to existing stakeholders rather than transformative goals.

Yet, a strategy that is authentic and aligned with key stakeholders and long-term goals will bring sustainable value.

The strategy must be supported by an accountability and performance measurement framework such as SMART metrics.

A fulsome reporting strategy should include performance metrics

Activity 3: SMART metrics

Input: ESG corporate purpose or any current ESG metrics, Outputs from activities 1 and 2, Internally defined metrics (i.e. risk metrics or internal reporting requirements)
Output: SMART metrics
Materials: Whiteboard/flip charts, ESG Reporting Workbook
Participants: Chief Sustainability Officer, Chief Compliance Officer, Chief Risk officer/Risk leaders, Head of ESG Reporting, Business leaders, Participants from marketing and communications

1-2 hours

1. Document a list of appropriate metrics to assess the success of your ESG program.
2. Use the sample metrics listed in the table on the next slide as a starting point.
3. Fill in the chart to indicate the:
   1. Name of the success metric
   2. Method for measuring success
   3. Baseline measurement
   4. Target measurement
   5. Actual measurements at various points throughout the process of improving the risk management program
   6. A deadline for each metric to meet the target measurement
4. Record this information in the ESG Reporting Workbook.

Download the ESG Reporting Workbook

Sample ESG metrics

Leverage industry resources to help define applicable metrics

Environmental

• Greenhouse gas emissions – total corporate
• Carbon footprint – percent emitted and trend
• Percentage of air and water pollution
• Renewable energy share per facility
• Percentage of recycled material in a product
• Ratio of energy saved to actual use
• Waste creation by weight
• Circular transition indicators

Social

• Rates of injury
• Lost time incident rate
• Proportion of spend on local suppliers
• Entry-level wage vs. local minimum wage
• Percentage of management who identify with specific identity groups (i.e. gender and ethnic diversity)
• Percentage of suppliers screened for accordance to ESG vs. total number of suppliers
• Consumer responsiveness

Governance

• Annual CEO compensation compared to median
• Percentage of employees trained in conflict-of-interest policy
• Number of data breaches using personally identifiable information (PII)
• Number of incidents relating to management corruption
• Percentage of risks with mitigation plans in place

Activity 3: Develop SMART project metrics

1-3 hours

Attach metrics to your goals to gauge the success of the ESG program.

Sample Metrics

Factor 4: Regulatory reporting obligations

Identify your reporting obligations

High-level overview of reporting requirements:

Refer to your legal and compliance team for the most up-to-date and comprehensive requirements.

The focus of regulators is to move to mandatory reporting of material climate-related financial information.

There is some alignment to the TCFD* framework, but there is a lack of standardization in terms of scope across jurisdictions.
*TCFD is the Task Force on Climate-Related Financial Disclosures.

Activity 4: Regulatory obligations

Input: Corporate strategy documents; Compliance registry or internal governance, risk, and compliance (GRC) tool
Output: A list of regulatory obligations
Materials: Whiteboard/flip charts, ESG Reporting Workbook
Participants: Chief Sustainability Officer, Chief Compliance Officer, Chief Legal Officer, Head of ESG Reporting, Business leaders

1-2 hours

1. Begin by listing the jurisdictions in which you operate or plan to operate.
2. For each jurisdiction, list any known current or future regulatory requirements. Consider all ESG components.
3. Log whether the requirements are mandatory or voluntary and the deadline to report.
4. Write any details about reporting framework; for example, if a reporting framework such as TCFD is prescribed.
5. Record this information in the ESG Reporting Workbook.

Download the ESG Reporting Workbook

1.2 Assess impact and weigh options

Once the scope of your ESG reporting framework has been identified, further assessment is needed to determine program direction and to understand and respond to organizational impact.

Key factors for further assessment and decisions include

1. Reporting framework options. Consider mandated reporting frameworks and any industry standards when deciding your baseline reporting framework. Strive to have a common reporting methodology that serves all your reporting needs: regulatory, corporate, shareholders, risk reporting, etc.
2. Perform gap analysis. The gap analysis will reveal areas where data may need to be sourced or where tools or external assistance may be needed to help deliver your reporting strategy.
3. Organizational impact and readiness. The gap analysis will help to determine whether your current operating model can support the reporting program or whether additional resources, tools, or infrastructure will be needed.

1.2.1 Decide on baseline reporting framework

1. Determine the appropriate reporting framework for your organization

Reporting standards are available to enable relevant, high-quality, and comparable information. It’s the job of the reporting entity to decide on the most suitable framework for their organization.

The most established standard for sustainability reporting is the Global Reporting Initiative (GRI), which has supported sustainability reporting for over 20 years.

The Task Force on Climate-Related Financial Disclosures (TCFD) was created by the Financial Stability Board to align ESG disclosure with financial reporting. Many global regulators support this framework.

The International Sustainability Standards Board (ISSB) is developing high-quality, understandable, and enforceable global standards using the Sustainability Accounting Standards Board (SASB) as a baseline. It is good practice to use SASB Standards until the ISSB standards are available.

2. Decide which rating agencies you will use and why they are important

ESG ratings are provided by third-party agencies and are increasingly being used for financing and transparency to investors. ESG ratings provide both qualitative and quantitative information.

However, there are multiple providers, so organizations need to consider which ones are the most important and how many they want to use.

Some of the most popular rating agencies include Sustainalytics, MSCI, Bloomberg, Moody's, S&P Global, and CDP.

Reference Appendix Below

1.2.2 Determine data gaps

The ESG reporting mandate is built on the assumption of consistent, good-quality data

To meet ESG objectives, corporations are challenged with collecting non-financial data from across functional business and geographical locations and from their supplier base and supply chains.

One of the biggest impediments to ESG implementation is the lack of high-quality data and of mature processes and tools to support data collection.

An important step for delivering reporting requirements is to perform a gap analysis early on to surface gaps in the primary data needed to deliver your reporting strategy.

The output of this exercise will also inform and help prioritize implementation, as it may show that new data sets need to be sourced or tools purchased to collect and aggregate data.

Conduct a gap analysis to determine gaps in primary data

Activity 5: Gap analysis

Input: Business (ESG) strategy, Data inventory (if exists), Output from Activity 1: Key stakeholders, Output from Activity 2: Materiality map, Output of Activity 3: SMART metrics, Output of Activity 4: Regulatory obligations
Output: List of high-priority data gaps
Materials: Whiteboard/flip charts, ESG Reporting Workbook
Participants: Chief Sustainability Officer, Chief Compliance Officer, Chief Legal Officer, Head of ESG Reporting, Business leaders, Data analysts

1-3 hours

1. Using the outputs from activities 1-4, list your organization’s ESG issues in order of priority. You may choose to develop your priority list by stakeholder group or by material risks.
2. List any defined SMART metric from Activity 3.
3. Evaluate data availability and quality of the data (if existing) as well as any impediments to sourcing the data.
4. Make note if this is a common datapoint, i.e. would you disclose this data in more than one report?
5. Record this information in the ESG Reporting Workbook.

Download the ESG Reporting Workbook

1.3 Take a holistic implementation approach

Currently, 84 percent of businesses don’t integrate their ESG performance with financial and risk management reporting.

Source: “2023 Canadian ESG Reporting Insights,” PwC.

When implementing an ESG reporting framework, it is important not to implement in silos but to take a strategic approach that considers the evolving nature of ESG and the link to value creation and sound decision making.

Key implementation considerations include

1. Setting clear metrics and targets. Key performance indicators (KPIs) and key risk indicators (KRIs) are used to measure ESG factor performance. It’s essential that they are relevant and are constructed using high-quality data. Your performance metrics should be continually assessed and adapted as your ESG program evolves.
2. Data challenges. Without good-quality data it is impossible to accurately measure ESG performance, generate actionable insights on ESG performance and risk, and provide informative metrics to investors and other stakeholders. Design your data model to be flexible and digital where possible to enable data interoperability.
3. Architectural approach. IT will play a key role in the design of your reporting framework, including the decision on whether to build, buy, or deliver a hybrid solution. Every organization will build their reporting program to suit their unique needs; however, taking a holistic and proactive approach will support and sustain your strategy long term.

1.3.1 Metrics and targets for climate-related disclosure

“The future of sustainability reporting is digital – and tagged.”
Source: “XBRL Is Coming,” Novisto, 2022.

In the last few years, global regulators have proposed or effected legislation requiring public companies to disclose climate-related information.

Yet according to Info-Tech’s 2023 Trends and Priorities survey, most IT professionals expect to support environmental mandates but are not prepared to accurately report on their organization’s carbon footprint.

IT groups have a critical role to play in helping organizations develop strategic plans to meet ESG goals, measure performance, monitor risks, and deliver on disclosure requirements.

To future-proof your reporting structure, your data should be readable by humans and machines.

eXtensible Business Reporting Language (XBRL) tagging is mandated in several jurisdictions for financial reporting, and several reporting frameworks are adopting XBRL for sustainability reporting so that non-financial and financial disclosure frameworks are aligned.

Example environmental metrics

• Amount of scope 1, 2, or 3 GHG emissions
• Total energy consumption
• Total water consumption
• Progress toward net zero emission
• Percentage of recycled material in a product

1.3.1 Metrics and targets for social disclosure

“59% of businesses only talk about their positive performance, missing opportunities to build trust with stakeholders through balanced and verifiable ESG reporting.”
Source: “2023 Canadian ESG Reporting Insights,” PwC.

To date, regulatory focus has been on climate-related disclosure, although we are beginning to see signals in Europe and the UK that they are turning their attention to social issues.

Social reporting focuses on the socioeconomic impacts of an organization’s initiatives or activities on society (indirect or direct).

The “social” component of ESG can be the most difficult to quantify, but if left unmonitored it can leave your organization open to litigation from consumers, employees, and activists.

Although organizations have been disclosing mandated metrics such as occupational health and safety and non-mandated activities such as community involvement for years, the scope of reporting is typically narrow and hard to measure in financial terms.

This is now changing with the recognition by companies of the value of social reporting to brand image, traceability, and overall corporate performance.

Example social metrics

• Rate of injury
• Lost time incident rate
• Proportion of spend on local suppliers
• Entry-level wage versus local minimum wage
• Percentage of management within specific identity groups (i.e. gender and ethnic diversity)
• Number of workers impacted by discrimination

Case Study: McDonald’s Corporation (MCD)

• INDUSTRY: Food service retailer
• SOURCE: RBC Capital Markets, 2021; McDonald’s, 2019

McDonald’s Corporation is the leading global food service retailer. Its purpose is not only providing burgers to dinner tables around the world but also serving its communities, customers, crew, farmers, franchisees, and suppliers alike. As such, not only is the company committed to having a positive impact on communities and in maintaining the growth and success of the McDonald's system, but it is also committed to conducting its business operations in a way that is mindful of its ESG commitments.

McDonald’s Better Together: Gender Balance & Diversity strategy and Women in Tech initiative

In 2019, MCD launched its Better Together: Gender Balance & Diversity strategy as part of a commitment to improving the representation and visibility of women at all levels of the corporate structure by 2023.

In conjunction with the Better Together strategy, MCD piloted a “Women in Tech” initiative through its education and tuition assistance program, Archways to Opportunity. The initiative enabled women from company-owned restaurants and participating franchisee restaurants to learn skills in areas such as data science, cybersecurity, artificial intelligence. MCD partnered with Microsoft and Colorado Technical University to carry out the initiative (McDonald’s, 2019).

Both initiatives directly correlate to the “S” of the ESG framework, as the benefits of gender-diverse leadership continue to be paramount in assessing the core strengths of a company’s overreaching ESG portfolio. Hence, public companies will continue to face pressure from investors to act in accordance with these social initiatives.

Results

MCD’s Better Together and Women in Tech programs ultimately helped improve recruitment and retention rates among its female employee base. After the initialization of the gender balance and diversification strategy, McDonald’s signed on to the UN Women’s Empowerment Principles to help accelerate global efforts in addressing the gender disparity problem.

1.3.1 Metrics and targets for governance disclosure

Do not lose sight of regulatory requirements

Strong governance is foundational element of a ESG program, yet governance reporting is nascent and is often embedded in umbrella legislation pertaining to a particular risk factor.

A good example of this is the recent proposal by the Securities and Exchange Commission in the US (CFR Parts 229, 232, 239, 240, and 249, Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure), which will require public companies to:

• Disclosure of board oversight of cyber risk.
• Disclose management’s role in managing and accessing cybersecurity-related risks.

The "G” component includes more than traditional governance factors and acts as a catch-all for other important ESG factors such as fraud, cybersecurity, and data hygiene. Make sure you understand how risk may manifest in your organization and put safeguards in place.

Example governance metrics

• Annual CEO compensation compared to median
• Percentage of employees trained in conflict-of-interest policy
• Completed number of supplier assessments
• Number of data breaches using PII
• Number of material cybersecurity breaches

Info-Tech Insight

The "G" in ESG may not be capturing the limelight under ESG legislation yet, but there are key governance factors that are that are under regulatory radar, including data, cybersecurity, fraud, and DEI. Be sure you stay on top of these issues and include performance metrics into your internal and external reporting frameworks.

1.3.2 Conquering data management challenges

Due to the nascent nature of climate-related reporting, data challenges such as the availability, usability, comparability, and workflow integration surface early in the ESG program journey when sourcing and organizing data:

• It is challenging to collect non-financial data across functional business and geographical locations and from supplier base and supply chains.
• The lack of common standards leads to comparability challenges, hindering confidence in the outputs.

In addition to good, reliable inputs, organizations need to have the infrastructure to access new data sets and convert raw data into actionable insights.

The establishment of data model and workflow processes to track data lineage is essential to support an ESG program. To be successful, it is critical that flexibility, scalability, and transparency exist in the architectural design. Data architecture must scale to capture rapidly growing volumes of unstructured raw data with the associated file formats.

Download Info-Tech’s Create and Manage Enterprise Data Models blueprint

1.3.3 Reporting architecture

CIOs play an important part in formulating the agenda and discourse surrounding baseline ESG reporting initiatives

Building and operating an ESG program requires the execution of a large number of complex tasks.

IT leaders have an important role to play in selecting the right technology approach to support a long-term strategy that will sustain and grow corporate performance.

The decision to buy a vendor solution or build capabilities in-house will largely depend on your organization’s ESG ambitions and the maturity of in-house business and IT capabilities.

For large, heavily regulated entities an integrated platform for ESG reporting can provide organizations with improved risk management and internal controls.

Example considerations when deciding to meet ESG reporting obligations in-house

• Size and type of organization
• Extent of regulatory requirements and scrutiny
• The amount of data you want to report
• Current maturity of data architecture, particularly your ability to scale
• Current maturity of your risk and control program – how easy is it to enhance current processes?
• The availability and quality of primary data
• Data set gaps
• In-house expertise in data, model risk, and change management
• Current operating model – is it siloed or integrated?
• Implementation time
• Program cost
• The availability of vendor solutions that may address gaps

Info-Tech Insight

Executive leadership should take a more holistic and proactive stance to not only accurately reporting upon baseline corporate financial metrics but also capturing and disclosing relevant ESG performance metrics to drive alternative streams of valuation across their respective organizational environments.

Activity 6: High-level implementation considerations

Input: Business (ESG) strategy, Data inventory (if exists), Asset inventory (if exists), Output from Activity 5
Output: Summary of high-level implementation considerations
Materials: Whiteboard/flip charts, ESG Reporting Workbook
Participants: Chief Sustainability Officer, Head of ESG Reporting, Business leaders, Data analysts, Data and IT architect/leaders,

2-3 hours

1. Review the implementation considerations on the previous slide to help determine the appropriate technology approach.
2. For each implementation consideration, describe the current state.
3. Discuss and draft the implications of reaching the desired future state by listing implications and organizational gaps.
4. Discuss as a group if there is an obvious implementation approach.
5. At this point, further analysis may be needed. Form a subcommittee or assign a leader to conduct further analysis.
6. Record this information in the ESG Reporting Workbook.

Download the ESG Reporting Workbook

1.3.4 Ensure your implementation team has a high degree of trust and communication

If external partners are needed, dedicate an internal resource to managing the vendor and partner relationships.

Communication: Teams must have some type of communication strategy. This can be broken into:

• Regularity: Having a set time each day to communicate progress and a set day to conduct retrospectives.
• Ceremonies: Injecting awards and continually emphasizing delivery of value to encourage relationship building and constructive motivation.
• Escalation: Voicing any concerns and having someone responsible for addressing those concerns.

Proximity: Distributed teams create complexity as communication can break down. This can be mitigated by:

• Location: Placing teams in proximity to close the barrier of geographical distance and time zone differences.
• Inclusion: Making a deliberate attempt to pull remote team members into discussions and ceremonies.
• Communication tools: Having the right technology (e.g. videoconference) to help bring teams closer together virtually.

Trust: Members should trust other members are contributing to the project and completing their required tasks on time. Trust can be developed and maintained by:

• Accountability: Having frequent quality reviews and feedback sessions. As work becomes more transparent, people become more accountable.
• Role clarity: Having a clear definition of what everyone’s role is.

1.4 Clear effective communication

Improving investor transparency is one of the key drivers behind disclosure, so making the data easy to find and consumable is essential

Your communication of ESG performance is intricately linked to corporate value creation. When designing your communications strategy, consider:

• Your message – make it authentic and tell a consistent story.
• How data will be used to support the narrative.
• How your ESG program may impact internal and external programs and build a communication strategy that is fit for purpose. Example programs are:
  • Employee recruitment
  • New product rollout
  • New customer campaign
• The design of the communication and how well it suits the audience. Communications may take the form of campaigns, thought leadership, infographics, etc.
• The appropriateness of communication channels to your various audiences and the messages you want to convey. For example, social media, direct outreach, shareholder circular, etc.

1.5 Continually evaluate

A recent BDC survey of 121 large companies and public-sector buyers found that 82% require some disclosure from their suppliers on ESG, and that's expected to grow to 92% by 2024.
Source: BDC, 2023

ESG's link to corporate performance means that organizations must stay on top of ESG issues that may impact the long-term sustainability of their business.

ESG components will continue to evolve, and as they do so will stakeholder views. It is important to continually survey your stakeholders to ensure you are optimally managing ESG risks and opportunities.

To keep ESG on the strategy agenda, we recommend that organizations:

• Appoint a chief sustainability officer (CSO) with a seat on executive leadership committees.
• Embed ESG into existing governance and form a tactical ESG working group committee.
• Ensure ESG risks are integrated into the enterprise risk management program.
• Continually challenge your ESG strategy.
• Regularly review risks and opportunities through proactive outreach to stakeholders.

Download The ESG Imperative and Its Impact on Organizations

Phase 2

Streamline Requirements and Tool Selection

This phase will walk you through the following activities:

• Assess technology and tooling opportunities.
• Prepare ESG reporting implementation plan.
• Write ESG reporting presentation document.

This phase involves the following participants: CIO, CCO, CSO, EA, IT application and data leaders, procurement, business leaders, marketing and communications, head of ESG reporting, and any dedicated ESG team members

2.1 Streamline your requirements and tool section

Spend the time up front to enable success and meet expectations

Before sourcing any technology, it’s important to have a good understanding of your requirements.

Key elements to consider:

1. ESG reporting scope. Large enterprises will have more complex workflow requirements, but they also will have larger teams to potentially manage in-house. Smaller organizations will need easy-to-use, low-cost solutions.
2. Industry and value chain. Look for industry-specific solutions, as they will be more tailored to your needs and will enable you to be up and running quicker.
3. Coverage. Ensure the tool has adequate regulatory coverage to meet your current and future needs.
4. Gap in functionality. Be clear on the problem you are trying to solve and/or the gap in workflow. Refer to the reporting lifecycle and be clear on your needs before sourcing technology.
5. Resourcing. Factor in capacity during and after implementation and negotiate the appropriate support.

Industry perspective

The importance of ESG is something that will need to be considered for most, if not every decision in the future, and having reliable and available information is essential. While the industry will continue to see investment and innovation that drives operational efficiency and productivity, we will also see strong ESG themes in these emerging technologies to ensure they support both sustainable and socially responsible operations.

With the breadth of technology Datamine already has addressing the ESG needs for the mining industry combined with our new technology, our customers can make effective and timely decisions through incorporating ESG data into their planning and scheduling activities to meet customer demands, while staying within the confines of their chosen ESG targets.

Chris Parry
VP of ESG, Datamine

Activity 7: Brainstorm tooling options

Use the technology feature list below to identify areas along the ESG workflow where automated tools or third-party solutions may create efficiencies

2.2 Vendors tools and technologies to support ESG reporting

In a recent survey of over 1,000 global public- and private-sector leaders, 87% said they see AI as a helpful tool to fight climate change.
Source: Boston Consulting Group

Technology providers are part of the solution and can be leveraged to collect, analyze, disclose, track, and report on the vast amount of data.

Increasingly organizations are using artificial intelligence to build climate resiliency:

• AI is useful for the predictive modelling of potential climate events due to its ability to gather and analyze and synthesize large complete data sets.

And protect organizations from vulnerabilities:

• AI can be used to identify and assess vulnerabilities that may lead to business disruption or risks in production or the supply chain.

2.3 ESG reporting software selection

What Is ESG Reporting Software?

Our definition: ESG reporting software helps organizations improve the transparency and accountability of their ESG program and track, measure, and report their sustainability efforts.

Key considerations for reporting software selection:

• While there are boutique ESG vendors in the market, organizations with existing GRC tools may first want to discuss ESG coverage with their existing vendor as it will enable better integration.
• Ensure that the vendors you are evaluating support the requirements and regulations in your region, industry, and geography. Regulation is moving quickly – functionality needs to be available now and not just on the roadmap.
• Determine the level of software integration support you need before meeting with vendors and ensure they will be able to provide it – when you need it!

Adoption of ESG reporting software has historically been low, but these tools will become critical as organizations strive to meet increasing ESG reporting requirements.

In a recent ESG planning and performance survey conducted by ESG SaaS company Diligent Corporation, it was found that over half of all organizations surveyed do not publish ESG metrics of any kind, and only 9% of participants are actively using software that supports ESG data collection, analysis, and reporting.

Source: Diligent, 2021.

2.3.1 Elicit and prioritize granular requirements for your ESG reporting software

Understanding business needs through requirements gathering is the key to defining everything about what is being purchased. However, it is an area where people often make critical mistakes.

Download Info-Tech's Improve Requirements Gathering blueprint

2.3.1 Identify critical and nice-to-have features

Central Data Repository: Collection of stored data from existing databases merged into one location that can then be shared, analyzed, or updated.

Automatic Data Collection: Ability to automate data flows, collect responses from multiple sources at specified intervals, and check them against acceptance criteria.

Automatic KPI Calculations, Conversions, and Updates: Company-specific metrics can be automatically calculated, converted, and tracked.

Built-In Indicator Catalogs and Benchmarking: Provides common recognized frameworks or can integrate a catalog of ESG indicators.

Custom Reporting: Ability to create reports on company emissions, energy, and asset data in company-branded templates.

User-Based Access and Permissions: Ability to control access to specific content or data sets based on the end user’s roles.

Real-Time Capabilities: Ability to analyze and visualize data as soon as it becomes available in underlying systems.

Version Control: Tracking of document versions with each iteration of document changes.

Intelligent Alerts and Notifications: Ability to create, manage, send, and receive notifications, enhancing efficiency and productivity.

Audit Trail: View all previous activity including any recent edits and user access.

Encrypted File Storage and Transfer: Ability to encrypt a file before transmitting it over the network to hide content from being viewed or extracted.

Activity 7: Technology and tooling options

Input: Business (ESG) strategy, Data inventory (if exists), Asset inventory (if exists), Output from Activity 5, Output from Activity 6,
Output: List of tooling options
Materials: Whiteboard/flip charts, ESG Reporting Workbook
Participants: Chief Sustainability Officer, Head of ESG Reporting, Business leaders, Data analysts, Data and IT architect/leaders

1-2 hours

1. Begin by listing key requirements and features for your ESG reporting program.
2. Use the outputs from activities 5 and 6 and the technology feature list on the previous slide to help brainstorm technology and tooling options.
3. Discuss the availability and readiness of each option. Note that regulatory requirements will have an effective date that will impact the time to market for introducing new tooling.
4. Discuss and assign a priority.
5. At this point, further analysis may be needed. Form a subcommittee or assign a leader to conduct further analysis.
6. Record this information in the ESG Reporting Workbook.

Download the ESG Reporting Workbook

Activity 8: Implementation plan

Input: Business (ESG) strategy, Output from Activity 5, Output from Activity 6, Output from Activity 7
Output: ESG Reporting Implementation Plan
Materials: Whiteboard/flip charts, ESG Reporting Implementation Plan Template
Participants: Chief Sustainability Officer, Head of ESG Reporting, Business leaders, Data analysts, PMO, Data and IT architect/leaders

1-2 hours

1. Use the outputs from activities 5 to 7 and list required implementation tasks. Set a priority for each task.
2. Assign the accountable owner as well as the group responsible. Larger organizations and large, complex change programs will have a group of owners.
3. Track any dependencies and ensure the project timeline aligns.
4. Add status as well as start and end dates.
5. Complete in the ESG Reporting Implementation Plan Template.

Download the ESG Reporting Implementation Plan Template

Activity 9: Internal communication

Input: Business (ESG) strategy, ESG Reporting Workbook, ESG reporting implementation plan
Output: ESG Reporting Presentation Template
Materials: Whiteboard/flip charts, ESG Reporting Presentation Template, Internal communication templates
Participants: Chief Sustainability Officer, Head of Marketing/ Communications, Business leaders, PMO

1-2 hours

Since a purpose-driven ESG program presents a significant change in how organizations operate, the goals and intentions need to be understood throughout the organization. Once you have developed your ESG reporting strategy it is important that it is communicated, understood, and accepted. Use the ESG Reporting Presentation Template as a guide to deliver your story.

1. Consider your audience and discuss and agree on the key elements you want to convey.
2. Prepare the presentation.
3. Test the presentation with smaller group before communicating to senior leadership/board

Download the ESG Reporting Presentation Template

Phase 3

Select ESG Reporting Software

This phase will provide additional material on Info-Tech’s expertise in the following areas:

• Info-Tech’s approach to RFPs
• Info-Tech tools for software selection
• Example ESG software assessments

3.1 Leverage Info-Tech’s expertise

Develop an inclusive and thorough approach to the RFP process

The Info-Tech difference:

1. The secret to managing an RFP is to make it as manageable and as thorough as possible. The RFP process should be like any other aspect of business – with a standard process in place, you are better able to handle whatever comes your way, because you know the steps you need to follow to produce a top-notch RFP.
2. The business then identifies the need for more information about a product/service or determines that a purchase is required.
3. A team of stakeholders from each area impacted gather all business, technical, legal, and risk requirements. What are the expectations of the vendor relationship post-RFP? How will the vendors be evaluated?
4. Based on predetermined requirements, either an RFI or an RFP is issued to vendors with a due date.

Info-Tech Insight

Review Info-Tech’s process and understand how you can prevent your organization from leaking negotiation leverage while preventing vendors from taking control of your RFP.

Software Selection Engagement

5 Advisory Calls Over a 5-Week Period to Accelerate Your Selection Process

Expert Analyst Guidance over5 weeks on average to select and negotiate software.

Save Money, Align Stakeholders, Speed Up the Process & make better decisions.

Use a Repeatable, Formal Methodology to improve your application selection process.

Better, Faster Results, guaranteed, included in membership.

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Leverage the Contract Review Service to level the playing field with your shortlisted vendors

You may be faced with multiple products, services, master service agreements, licensing models, service agreements, and more.

Use the Contract Review Service to gain insights on your agreements.

Consider the aspects of a contract review:

1. Are all key terms included?
2. Are they applicable to your business?
3. Can you trust that results will be delivered?
4. What questions should you be asking from an IT perspective?

Validate that a contract meets IT’s and the business’ needs by looking beyond the legal terminology. Use a practical set of questions, rules, and guidance to improve your value for dollar spent.

Click here to book The Contract Review Service

Download blueprint Master Contract Review and Negotiation for Software Agreements

3.2 Vendor spotlight assessments

See above for a vendor landscape overview of key ESG reporting software providers

The purpose of this section is to showcase various vendors and companies that provide software solutions to help users manage and prioritize their ESG reporting initiatives.

This section showcases the core capabilities of each software platform to provide Info-Tech members with industry insights regarding some of the key service providers that operate within the ESG vendor market landscape.

Info-Tech members who are concerned with risks stemming from the inability to sort and disseminate unstructured ESG data reporting metrics or interested in learning more about software offerings that can help automate the data collection, processing, and management of ESG metrics will find high-level insights into the ESG vendor market space.

Vendor spotlight

The establishment of the Datamine ESG unit comes at the same time the mining sector is showing an increased interest in managing ESG and its component systems as part of a single scope.

With miners collecting and dealing with ever-increasing quantities of data and looking for ways to leverage it to make data-driven decisions that enhance risk management and increase profitability, integrated software solutions are – now more than ever – essential in supporting continuous improvement and maintaining data fidelity and data integrity across the entire mining value chain.

Key Features:

• Discover GIS for geochemical, water, erosion, and vegetation modelling and management.
• Qmed for workforce health management, COVID testing, and vaccine administration.
• MineMarket and Reconcilor for traceability and auditing, giving visibility to chain of custody and governance across the value chain, from resource modelling to shipping and sales.
• Centric Mining Systems – intelligence software for real-time transparency and governance across multiple sites and systems, including key ESG performance indicator reporting.
• Zyght – a leading health, safety, and environment solution for high-impact industries that specializes in environment, injury, risk management, safe work plans, document management, compliance, and reporting.
• Isystain – a cloud-based platform uniquely designed to support health, safety & environment, sustainability reporting, compliance and governance, and social investment reporting. Designed for seamless integration within an organization’s existing software ecosystems providing powerful analytics and reporting capabilities to streamline the production of sustainability and performance reporting.

Vendor spotlight

Benchmark ESG provides industry-leading ESG data management and reporting software that can assist organizations in managing operational risk and compliance, sustainability, product stewardship, and ensuring responsible sourcing across complex global operations.

Key Features:

• Benchmark ESG™ Analytics by Tableau provides multidimensional analytics and interactive visualization displays to help easily share insights and intelligence for more careful interpretation of ESG reporting metrics.
• Benchmark provides support for Scope 1, 2, and 3 emissions calculation and tracking capabilities.
• Benchmark is a CDP-accredited solutions provider. Thus, the platform strongly aligns itself with mainstream ESG reporting frameworks.

Vendor spotlight

PwC’s ESG Management Solution provides quick insights into ways to improve reporting transparency surrounding your organization’s ESG commitments.

According to PwC’s most recent CEO survey, the number one motivator for CEOs in mitigating climate change risks is their own desire to help solve this global problem and drive transparency with stakeholders.
Source: “Annual Global CEO Survey,” PwC, 2022.

Key Features:

• Streamlined data mining capabilities. PwC’s ESG solution provides the means to streamline, automate, and standardize the input of sustainability data based on non-financial reporting directive (NFRD) and corporate sustainability reporting directive (CSRD) regulations.
• Company and product carbon footprint calculation and verification modules.
• Robust dashboarding capabilities. Option to create custom-tailored sustainability monitoring dashboards or integrate existing ESG data from an application to existing dashboards.
• Team management functionalities that allow for more accessible cross-departmental communication and collaboration. Ability to check progress on tasks, assign tasks, set automatic notifications/deadlines, etc.

Vendor spotlight

ServiceNow ESG Management (ESGM) and reporting platform helps organizations transform the way they manage, visualize, and report on issues across the ESG spectrum.

The platform automates the data collection process and the organization and storage of information in an easy-to-use system. ServiceNow’s ESGM solution also develops dashboards and reports for internal user groups and ensures that external disclosure reports are aligned with mainstream ESG standards and frameworks.

We know that doing well as a business is about more than profits. One workflow at a time, we believe we can change the world – to be more sustainable, equitable, and ethical.
Source: ServiceNow, 2021.

Key Features:

1. An executive dashboard to help coherently outline the status of various ESG indicators, including material topics, goals, and disclosure policies all in one centralized hub
2. Status review modules. Ensure that your organization has built-in modules to help them better document and monitor their ESG goals and targets using a single source of truth.
3. Automated disclosure modules. ESGM helps organizations create more descriptive ESG disclosure reports that align with industry accountability standards (e.g. SASB, GRI, CDP).

Other key vendors to consider

Related Info-Tech Research

Definitions

Reporting and standard frameworks