ISRC Topic Brief The Governance and Structure of the IT Organization

As organizations have become more complex over the past twenty years, so have the structures and the governance mechanisms that control them. Similarly, with the growth of various computer technologies, IT has become increasingly complex, in terms of hardware, software, and architecture. Thus, the governance and structure of IT reflects both organizational and technological changes. During the 20 century, four major governance structures have emerged: centralized (where 10-15% of IT responsibility is devolved and decentralized), centralized hybrid (where 50% of IT responsibility is devolved and decentralized), decentralized hybrid (where 70-80% of IT responsibility is devolved and decentralized), and decentralized (where all IT responsibility is devolved and decentralized). However, not all IT organizations are entirely one of the four structures. Instead, IT structures are hybrid arrangements, where the three major functions of IT: infrastructure management, use management, and project management are governed by different structures, depending on the nature of the corporation. Many different variables influence how an IT department governs and structures themselves, including corporate governance, economies of scope, and absorptive capacities. Nonetheless, as corporate structures continue to evolve and technology becomes increasingly complex, IT governance and structures will continue to adapt to meet the changing needs of tomorrow's business.