The Role of IT Governance in Organizational Performance

Abstract

This study investigates the multifaceted relationship between IT governance and organizational performance, examining how effective ITG mechanisms contribute to the development of dynamic IT capabilities and ultimately enhance overall business outcomes. It addresses a central question for researchers and practitioners: how information technology governance can help organizations survive and thrive in constantly changing business environments. Specifically, this research delineates how the strategic deployment of IT governance frameworks can cultivate IT resource investment decisions and foster process capabilities that are critical for achieving both IT performance and broader business objectives. The empirical evidence suggests a positive correlation between robust IT governance and observable improvements in organizational performance. This correlation is mediated by the effective management, control, and integration of IT infrastructure, alongside the strategic alignment of IT with business objectives. This strategic alignment, often an elusive goal for many organizations, is crucial for leveraging IT to sustain and extend business value.. To this end, an IT governance audit, utilizing frameworks such as COBIT 2019, becomes indispensable for evaluating a company's capabilities in managing IT changes, identifying managed solutions, and ensuring that IT aligns with overarching strategic objectives.