ICT Governance and the Board

The introduction of consumer-directed care and funding presents significant challenges for the Not for Profit sector, writes John Picot Technology Advisory with Grant Thornton Australia.

To ensure their ongoing financial viability, boards and their organisations must modify service delivery models. Greater levels of information and communication technology literacy will also be needed, to inform sound commercial decisions and provide the best support to their organisations.

Not for Profit organisations (NFPs) have traditionally depended on government funding to fulfil their mission and purpose. A more market-facing business model, activity-based funding and consumer choice characterises the recent public policy changes wrought by the Commonwealth Government.

The underlying rationale for the change is the concept of efficient pricing, which is placing unfamiliar pressures on NFP business systems, which are often fragmented, siloed into separate service programs, with poor or no data integration making timely and accurate reporting difficult. These business processes and underlying technologies have usually grown organically, without a whole-of-organisation strategy or plan.

The recent funding changes bring with them strategic and operational challenges for NFP boards, requiring much greater financial discipline, and enhanced workforce utilisation focused on client needs and core competencies.

An allied challenge for NFP boards is to know the specific competencies to require of the executive in order to provide confidence that the necessary strategies are in place to manage the changes and ensure the organisation’s investment in information and communications technology (ICT) is both sufficient and fully aligned with organisational strategy.

Boards need their executive teams to have:

· A business technology strategy that strongly aligns with the organisation’s strategic plan.

· A prioritised program of work, with detailed timelines, status of projects and risk profile.

· For those organisations with sufficient scale, an organisational ICT Governance Committee drawn from the executive (potentially including board representation) with well-defined terms of reference

· An established methodology to support strategic procurement through to implementation and post-implementation review.

· Regular examination of projects and business cases to assess the strength of their alignment with strategy and underlying business rationales.

We often see NFP organisations with a low level of ICT maturity and work with them to put foundations in place and build their internal capability.

This is a journey that requires a trusted guide to assist. With continuous change being the only certainty in the current policy and business climate, organisational capability to manage and support technology projects is a must, not an optional extra.

About the author: John Picot is the Technology Advisory and Solutions with Grant Thornton Australia – assurance, tax and specialist advisory services to Not for Profits, privately held businesses and corporate and listed entities.