Accenture: Establishing an IT Governance Model to Fuel Business Success

Today, more than 60 percent of the company’s more than 180,000-strong workforce is mobile and dependent on access to an anywhere, anytime infrastructure that fosters collaboration and productivity. Accenture’s award-winning Chief Information Officer (CIO) Organization is charged with delivering the innovative, effective information technology (IT) solutions that enable its internal customers to achieve high performance. Central to this responsibility is a coherent, universally accepted governance model that is in lockstep with the business strategies that drive business growth.

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Accenture High Performance Business research reveals that top companies develop a strong performance anatomy that allows them to continually pursue customer-valued innovations and execute better than their competitors. A company’s IT capability—which allows businesses focused on high performance to create and act on customer and business insights in real time, transform business models and create new products and services—is an increasingly important component of a strong performance anatomy. So, too, is a proactive IT governance model that ensures the involvement of business leaders in planning and aligning IT initiatives with business priorities.

Accenture clearly understands the need for a strong and responsive IT governance strategy. As a heavily matrixed organization with five operating groups, 17 focused industry groups and businesses in consulting, outsourcing, and systems integration and technology across 49 countries, the company’s IT demands are particularly heavy. The company has long recognized that governance not only focuses Accenture’s IT spending on critical business priorities, but also demands measurable and sustainable results.

To better support the company’s ongoing efforts to achieve high performance, the Accenture CIO Organization wanted to develop a robust IT governance model that would better support the evolving and complex business. Such a governance model would enable Accenture to make better sense of IT in business terms and also justify its IT expenditures with defined metrics and outcomes from diverse business sponsors across the global company.

Accenture’s CIO Organization crafted a modern, comprehensive and innovative IT governance model that calls on business leaders to help shape IT decisions. Under the new, centralized model, all major IT decisions are defined and confirmed by an IT Steering Committee chaired by Accenture’s CIO and composed of chief operating officers from the company’s various businesses, as well as stakeholders from functional areas such as human resources and finance.

Thomas Pike, Accenture Products North America Operating Unit Lead and former IT Steering Committee member, says: “Accenture’s IT governance model has been a very effective process for ensuring that our IT strategy is aligned with the needs of our business. Moreover, the business and IT have been able to reach consensus on reducing technology costs while, at the same time, investing in differentiating technology that is absolutely critical for our business success.”

Robert E. Kress, senior director-IT Business Operations, agrees. “Our IT governance prevents the kind of second-guessing that deadlocks momentum. In addition, Accenture does what very few IT organizations do. The IT Steering Committee swiftly evaluates all IT projects and we measure the benefits achieved from projects after completion. This highly ambitious ‘benefits-realized’ review process, which gauges the results of IT improvements for Accenture’s business, allows Accenture’s IT organization to regularly report on how well IT projects meet expectations. This significantly increases accountability for results.”

The IT Steering Committee is just one component of the new IT governance solution. A managed services approach places many IT decisions in the hands of the end-user organizational leaders. This allows these leaders to gain a clear understanding of costs and what generates them. In addition, Accenture provides a standard, but flexible, menu of IT products and services to meet the business requirements of its customers at a market-competitive cost. Together, these IT governance and provisioning capabilities help ensure that IT initiatives remain aligned to overarching business objectives.

In examining the success of its IT initiatives, Accenture engages its Internal Audit group to audit the claimed benefits, bringing objectivity and validity to the process. In fiscal 2008, the company realized 108 percent of the proposed benefits outlined in the original business cases approved by the IT Steering Committee from fiscal years 2005 to 2007.

Effective IT governance enables all constituents to have a voice in major IT decisions. The new IT governance model, which satisfies this call for collaboration, has enabled the company to meet the demands of its clients and end users, while keeping employees on the cutting edge of technology. The collaborative model of governance has also brought recognition from peers. Accenture was cited by InformationWeek magazine as having the 29th-most innovative IT organization out of 500 North American companies. And CIO magazine selected Accenture as one of 100 innovative organizations that use IT effectively to create business value.

The numbers also tell the story. A leading industry analyst benchmark of the world’s largest IT organizations ranked Accenture the best in three key measurements: lowest IT expense as a percentage of net revenue; lowest IT workforce as a percentage of headcount; and lowest IT expense per employee. The robust IT governance model played an instrumental role in achieving these successes. It has strengthened Accenture’s ability to transform IT into a strategic asset. It has helped ensure that the IT strategy is closely aligned with Accenture’s business strategy from the start. And it has demonstrated to our company’s clients the role that well-governed IT can play in supporting a company’s performance anatomy and its vision for high performance.