IT controlling has the tasks of supporting the optimal ­interaction between business and IT, enabling goal-oriented ­management of IT resources by IT management and, at the same time, offering incentives for economically reasonable ­actions of all parties involved. IT controlling instruments assure the transparency required for these tasks and lay the foundation for goal-oriented, successful planning and implementation of IT management activities. Strategic and operational IT controlling constitute a closed loop (cf. Figure 1) in which strategic IT controlling creates transparency concerning IT effectiveness while operational IT controlling enables assessment of IT efficiency. The link between the two is operational IT reporting, which also flows into the strategic performance management ­system, e.g. the Balanced Scorecard, thereby becoming a decision-­making basis for strategic IT controlling.

Starting from company strategy or of the organizational unit, the requirements made on IT are determined and transferred into the IT strategy by means of according goal formulations. Improvement of agility and competitiveness, greater internationalization, and increase in market shares are among the typical strategic goals. The measures required for the implementation of the strategic goals in which optimal organization and support of business processes are crucial success factors are anchored in IT planning. The necessary long-term investment decisions and budget specifications are derived by means of the instrument of portfolio controlling within the frame of strategic IT controlling. Operational controlling instruments such as cost and activity accounting build on these factors to manage the IT organization with respect to short-term goals such as improvement of economic efficiency, increase in productivity, utilization of capacities, and profitability, and the reduction of unit costs. Operational IT controlling makes use of the instrument of IT reporting for evaluation purposes, which generates target-actual comparisons as the basis for necessary management measures.

Portfolio controlling enables transparent management and alignment of IT portfolios