Do Boards Need a Technology Audit Committee?
What does FedEx, Pfizer, Wachovia, 3Com, Mellon Financial, Shurgard Storage, Sempra Energy, and Proctor & Gamble have commonplace? What board committee exists for the most effective 10% of publicly-traded agencies but generates 6.5% more returns for those agencies? What is the single most oversized price range item after salaries and production system?
Technology choices will outlive the tenure of the control crew, making the one’s decisions. While the present-day speedy pace of technological alternate way that company era selections are standard and far-accomplishing, the results of the choices-each suitable and terrible-will stay with the company for a long time. Usually, era decisions are made unilaterally inside the Information Technology (IT) organization, over which senior management chose to have no input or oversight. For the Board of a commercial enterprise to carry out its duty to workout business judgment over key decisions, the Board needs to have a mechanism for reviewing and guiding technology decisions.
The latest instance in which this type of oversight could have helped became the Enterprise Resource Planning (ERP) mania of the mid-1990s. At the time, many agencies have been making investments tens of thousands and thousands of bucks (and every so often masses of tens of millions) on ERP systems from SAP and Oracle. Often these purchases have been justified by way of executives in Finance, HR or Operations strongly advocating their investment as a way of retaining up with their competitors, who were also installing such structures. CIO’s and line executives frequently did now not deliver sufficient notion to the trouble of how to make a successful transition to those very complex systems. Alignment of company sources and control of organizational change provided by these new systems changed into left out, frequently ensuing in a crisis. Many billions of bucks were spent on structures that both have to no longer were offered at all or were bought earlier than the customer corporations had been organized.
Indeed, no successful medium or huge business may be run nowadays without computer systems and the software that makes them useful. Technology also represents one of the unmarried most immense capital and operating line objects for business prices, outdoor exertions, and production equipment. For each of these reasons, Board-level oversight of generation is appropriate at some stage.
Can the Board of Directors continue to go away these essential selections completely to the cutting-edge control crew? Most huge generation choices are inherently risky (research has shown much less than 1/2 deliver on promises) simultaneously as terrible selections take years to be repaired or changed. Over half of the generation investments aren’t returning predicted gains in commercial enterprise overall performance; Boards are consequently turning into worried about era choices. Suddenly, the best ten percent of the publicly traded businesses have IT Audit Committees as a part of their forums. However, the one’s businesses experience a clean, aggressive gain in the form of a compounded annual return 6—five% extra than their competitors.
Fundamentally, the Board’s function in IT Governance is to align between IT tasks and commercial enterprise goals, monitor movements taken using the era guidance committee, and validate that generation method and practices are handing over cost to the business. Strategic alignment among IT and the company is essential to constructing an era architectural basis that creates agile businesses. Boards need to be privy to technological chance exposures, management’s assessment of those dangers, and mitigation strategies considered and followed.
There are no new ideas right here-only confirmation of existing governance charters. The execution of oversight of management is the duty of the Board. The Board needs to take appropriate ownership and become proactive in the governance of the era.
Patent facts can be used in the practice of technological landscapes. Logistic mathematics and circle arithmetic may be very useful inside the plotting of the technological panorama. It can display the evolutionary fashion of a generation, how it’s far evolved from a necessary era, in conjunction with the duration of the technological diversification and its nature. These maps can even supply the distinctive assessment of the unique technology’s merging to give an upward push to interrupt-thru technology. These sorts of charts may be beneficial for the R&D personals to evaluate their research and technology. Placement Additionally, they may locate a way to extra innovate more advanced and valuable technology.
Companies want to understand what technology competitors can choke easily and can be attempting to in today’s worldwide context. They also need to recognize the spaces in technologies in which opposition is extreme and the areas where competitors are concentrating their IP improvement and their R&D efforts. They need an effort to track patent acquisition and improvement strategies and chart out the aggressive panorama. To examine the era earlier than making any investment choice, firms want to recognize the pace of patenting pastime within the generation, which patents encompass essential thoughts inside the technology, and how susceptible the firm’s technology is to patent infringements. This will give them an awful lot of wanted information in identifying among generation development and generation acquisition.
The capability to extract relevant records from patent literature is an essential achievement thing for absolutely everyone involved in technological innovation. The generation mapping method may be used to transform patent facts into information that may affect decision-making.
Patents are an important supply of technological intelligence that companies can use to benefit strategic gain. Technology intelligence may be used to gather, study, forecast, and deal with external generation associated facts, including patent data. Computational patent mapping is a technique for developing and alerting a technology knowledge base for technology and aggressive intelligence. The number one deliverables of patent mapping are inside the shape of understanding visualization via panorama and maps. These maps offer precious intelligence on technology evolution/revolution, the nature of various pioneering styles, large, pure, and rising players, trendy evaluation, and many others.