Isaca CGEIT - Certified in the Governance of Enterprise IT Exam

 Before deciding whether to pursue a strategic initiative, it is important to understand the potential consequences of the risks involved. Assessing the impact of each risk means estimating how likely it is to occur and how severe its effects would be on the enterprise’s objectives, performance, reputation, or resources. This can help to prioritize the most critical risks and compare them with the expected benefits of the initiative. According to one of the web search results1, “the impact assessment is a key element of any risk management process. It helps to evaluate the significance of each risk and determine the appropriate response strategy.” Defining the risk mitigation strategy, establishing a baseline for each initiative, and selecting qualified personnel to manage the project are important steps, but they are not the first ones. They aremore likely to be part of the implementation or execution phase of the initiative, after it has been approved and funded. References := Risk Impact Assessment and Prioritization

A business impact analysis (BIA) is a process of predicting the organizational and financial impact of business disruptions, such as vendor system failures. A BIA can help the CIO to prepare for this concern by identifying the critical business processes, the potential effects of disruption, and the recovery requirements and strategies. A BIA can also help the CIO to prioritize the resources and actions needed to restore the normal operations as quickly as possible1. A BIA is an essential component of business continuity planning (BCP) and disaster recovery planning (DRP)2.

An IT balanced scorecard is a tool that measures and monitors the performance of IT in relation to the strategic goals and objectives of the organization. An IT balanced scorecard can help the CIO to evaluate the effectiveness and efficiency of IT, but it does not address the impact of business disruptions or the recovery plans.

Service-level metrics are indicators that measure and report the quality and availability of IT services delivered to the customers or users. Service-level metrics can help the CIO to track and improve the service delivery, but they do not assess the impact of business disruptions or the recovery plans.

An IT procurement policy is a document that defines the rules and procedures for acquiring IT products and services from external vendors. An IT procurement policy can help the CIO to manage the vendor relationships, contracts, and risks, but it does not analyze the impact of business disruptions or the recovery plans. References: How To Conduct Business Impact Analysis in 8 Easy Steps. The Top 10 Vendor Risks & How to Manage Them. What is FMEA? Failure Mode & Effects Analysis. Definition of Business Impact Analysis (BIA). [IT Balanced Scorecard: Definition, Frameworks, Examples]. [Service Level Metrics: Definition, Types, Examples]. [IT Procurement Policy: Definition, Components, Examples].

Data storage and transmission policies are documents that define the rules and guidelines for how data is stored, accessed, shared, and transmitted within and outside an organization. Data storage and transmission policies can help to ensure the security, privacy, compliance, and quality of the data, as well as to prevent data loss, leakage, or breach12.

If an enterprise has decided to utilize a cloud vendor for the first time to provide email as a service, eliminating in-house email capabilities, one of the IT strategic actions that should be triggered by this decision is to update and communicate data storage and transmission policies. This is because using a cloud vendor for email as a service may introduce new risks and challenges for data storage and transmission, such as data sovereignty, data ownership, data encryption, data backup, data retention, data deletion, data access control, data audit, data breach notification, etc34. Therefore, it is important to update the data storage and transmission policies to reflect the changes in the email environment and the cloud vendor’s responsibilities and obligations. It is also important to communicate the updated policies to all relevant stakeholders, such as employees, customers, partners, regulators, etc., to ensure their awareness and compliance12. References: Data Storage Policy: Definition & Best Practices. Data Transmission Policy: Definition & Best Practices. Cloud Email Security: Definition & Best Practices. Cloud Data Protection: Definition & Best Practices.

 The most comprehensive view into the potential value of procuring customer information for a marketing enterprise would be provided by the cost-benefit analysis results. A cost-benefit analysis is a method of comparing the costs and benefits of a project or decision in monetary terms. It helps to evaluate the feasibility, profitability, and efficiency of the project or decision, and to identify the best alternative among different options. A cost-benefit analysis can also incorporate non-monetary factors, such as social and environmental impacts, by assigning them monetary values or weights. A cost-benefit analysis can show the net benefit (or net cost) of procuring customer information, as well as the benefit-cost ratio, the payback period, and the internal rate of return. These indicators can help the marketing enterprise to assess how well the procurement of customer information aligns with its objectives, strategies, and budget, and how much value it can create for the enterprise and its customers

A responsive risk awareness culture is the best reflection of mature risk management in an enterprise, because it implies that the organization has a high level of risk maturity that enables it to reduce noise and focus more effectively on truly high-risk concerns, choose cost-effective solutions for the risk management priorities, and execute reliably1. A responsive risk awareness culture also means that the organization has a clear and consistent risk appetite and tolerance, and that the employees are cognizant of the relevant risks as part of their actions2. A responsive risk awareness culture also fosters trust, collaboration, and innovation among the stakeholders, and helps the organization to adapt to changing business environments and emerging risks3.

The other options are not as indicative of mature risk management in an enterprise, because they are either too narrow or too reactive. A regularly updated risk register is a useful tool forcataloguing, tracking, and mitigating risks, but it does not necessarily reflect the strategic alignment, integration, or performance of the risk management process4. Ongoing risk assessment is an essential activity for identifying and evaluating risks, but it does not guarantee that the risks are prioritized, communicated, or managed effectively5. Ongoing investment in risk mitigation is a sign of commitment to risk management, but it does not ensure that the investment is aligned with the risk appetite and tolerance, or that it delivers value to the organization5.

The first step in creating an effective long-term mobile application strategy is to identify the business requirements concerning mobile applications. Business requirements are the needs, expectations, and objectives of the business stakeholders and customers for a product or service. Business requirements can help to define the scope, purpose, value, and quality of the mobile applications, as well as to align them with the business strategy and goals12.

By identifying the business requirements concerning mobile applications, the enterprise can understand what the customers want and need from the mobile applications, what problems or pain points they are facing with the current applications, what features or functions they are looking for or missing, what benefits or outcomes they are expecting or measuring, and what preferences or feedback they have for improving the mobile applications12.

Identifying the business requirements concerning mobile applications can also help the enterprise to prioritize and plan the development, testing, and deployment of the mobile applications, by using criteria such as feasibility, suitability, scalability, security, compliance, etc. Identifying the business requirements concerning mobile applications can also help the enterprise to monitor and evaluate the performance and satisfaction of the mobile applications, by using metrics, indicators, and reports12.

Therefore, identifying the business requirements concerning mobile applications is the first step in creating an effective long-term mobile application strategy. This can help the enterprise to deliver mobile applications that meet or exceed the customer expectations and requirements, and that are superior to the legacy browser-based applications. References: Business Requirements: Definition & Best Practices. How to Write a Business Requirements Document: A Comprehensive Guide.

The first governance action that should be taken when the financial assumptions supporting a project have changed is to request an update to the business case. The business case is the document that justifies the initiation, continuation, or termination of a project based on its expected costs, benefits, and risks. A change in the financial assumptions may affect the viability and value of the project, and therefore, the business case should be revised to reflect the new situation. The updated business case will then inform the subsequent governance actions, such as scheduling an interim project review, requesting a risk assessment, or re-evaluating the project inthe portfolio. According to one source1, “The business case is a living document and should be reviewed and updated periodically as new information becomes available.” References := ISACA, CGEIT Review Manual, 27th Edition, 2020, page 14; Tips for Agile Project Governance

 The use of an IT balanced scorecard enables the realization of business value of IT through outcome measures and performance drivers. Outcome measures are the indicators of the results or consequences of the IT activities, such as customer satisfaction, revenue growth, or market share. Performance drivers are the factors that influence or contribute to the outcome measures, such as process efficiency, quality, or innovation. By using an IT balanced scorecard, the organization can link the outcome measures and performance drivers to the IT objectives, strategies, and actions, and monitor and evaluate how well IT delivers value to the business

 Procedures have been established for assessing and mitigating information security risks is the most effective way to demonstrate operational readiness to address information security risk issues, as it shows that the enterprise has a systematic and consistent approach to identify, analyze, treat, and monitor information security risks. Procedures also provide guidance and direction for the staff involved in information security risk management activities12. References := CGEIT Exam Content Outline, Domain 4, Subtopic B: IT Risk Management, Task 1: Ensure that an IT risk management framework exists to identify, analyze, mitigate, manage, monitor, and communicate IT-related business risk, and that the framework for IT risk management is in alignment with the enterprise risk management (ERM) framework.

A business case evaluation is the best input for prioritizing strategic IT improvement initiatives because it provides a clear and objective assessment of the costs, benefits, risks, and value of each initiative. A business case evaluation helps to compare different options and select the ones that align with the organization’s goals, strategy, and budget. A business case evaluation also helps to justify the investment and secure the support and approval from the stakeholders.

A business dependency assessment is a process that identifies the critical business functions and processes that rely on IT services and resources. It helps to determine the impact of IT disruptions or failures on the business continuity and recovery. A business dependency assessment is useful for IT risk management and disaster recovery planning, but not for prioritizing strategic IT improvement initiatives.

A business process analysis is a method that examines the current state of the business processes, identifies the gaps, inefficiencies, and opportunities for improvement, and proposes solutions to optimize the processes. A business process analysis helps to streamline the workflows, reduce costs, increase quality, and enhance customer satisfaction. A business process analysis is valuable for IT process improvement and automation, but not for prioritizing strategic IT improvement initiatives.

A business impact analysis (BIA) is a technique that evaluates the potential consequences of a disruption or disaster on the organization’s operations, assets, reputation, and stakeholders. It helps to estimate the financial and nonfinancial losses, recovery time objectives, recovery point objectives, and criticality levels of each business function and process. A BIA is essential for IT business continuity management and contingency planning, but not for prioritizing strategic IT improvement initiatives.

References := IT Strategy Examples & Best Practices — IT Companies Network, How to create an IT strategy plan section. What is an IT Roadmap? | Benefits and Roadmap Examples - ProductPlan, How to Prioritize Your IT Roadmap section. 7 ways to make IT operations more efficient | CIO, Use data to increase visibility section.

A business impact analysis (BIA) report is the most valuable input when quantifying the loss associated with a major risk event. A BIA report is a document that identifies and evaluates thepotential effects of disruptions to critical business functions and processes. A BIA report can help estimate the financial, operational, reputational, and legal impacts of a risk event, as well as the recovery time and resources needed to resume normal operations. A BIA report can also help prioritize the recovery strategies and objectives based on the criticality and urgency of the business functions and processes.

The other options are not the most valuable input when quantifying the loss associated with a major risk event. Key risk indicators (KRIs) are metrics that provide an early warning of potential threats to the organization’s objectives and performance. KRIs can help monitor and measure the risk exposure and effectiveness of risk management activities, but they do not directly quantify the loss associated with a risk event. IT environment threat modeling is a technique that identifies and analyzes the possible vulnerabilities and attack vectors in an IT system or network. Threat modeling can help improve the security and resilience of IT assets and services, but it does not directly quantify the loss associated with a risk event. Recovery time objectives (RTOs) are the maximum acceptable time frames for restoring business functions and processes after a disruption. RTOs can help determine the recovery priorities and strategies, but they do not directly quantify the loss associated with a risk event.

For more information on BIA and quantifying loss, you can refer to these web sources:

What is Business Impact Analysis? Definition, Benefits & Examples

Quantifying Loss Associated with Major Risk Event - Exam-Answer

Quantifying the Qualitative Technology Risk Assessment - ISACA

 The most important factor for the effective design of an IT balanced scorecard is identifying appropriate key performance indicators (KPIs). KPIs are the measures that reflect the critical success factors of the IT strategy and goals, and that help to monitor and evaluate the IT performance and value. KPIs should be aligned with the four perspectives of the balanced scorecard: financial, customer, internal process, and learning and growth. KPIs should also be SMART: specific, measurable, achievable, relevant, and time-bound. By choosing the right KPIs, the IT balanced scorecard can provide a comprehensive and balanced view of the IT contribution to the business, and support the decision-making and improvement processes

The change management control framework is the first IT governance action to correct the problem of declining code quality and security flaws, as it defines and implements the policies, procedures, and standards for managing changes to the IT systems and software. The change management control framework also ensures that changes are authorized, tested, documented, and deployed in a consistent and secure manner12. A review of the change management control framework can help to identify and address the root causes of the security breach, and to prevent or mitigate similar incidents in the future. References := CGEIT Exam Content Outline, Domain 1, Subtopic C: Technology Governance, Task 3: Ensure that IT processes are compliant with relevant laws, regulations and contractual requirements.

The most effective way for a CIO to govern business unit deployment of shadow IT applications in a cloud environment is to educate the executive team about the risk associated with shadow ITapplications. This is because shadow IT applications are often deployed without the knowledge or approval of the central IT organization, and may pose security, compliance, and performance risks to the enterprise. By raising awareness of these risks among the executive team, the CIO can foster a culture of IT governance and alignment, and encourage the business units to follow the established application implementation process. References: CGEIT Certification | Certified in Governance of Enterprise IT | ISACA1, IT Governance: Definitions, Frameworks and Planning - ProjectManager2

The best key risk indicator (KRI) to show progress in IT employee behavior regarding application security issues is the results of application security awareness training quizzes. This KRI measures the level of knowledge and understanding that IT employees have acquired from the security training sessions, and how well they can apply it to their work. This KRI can also help to identify the gaps and weaknesses in the training content and delivery, and suggest areas for improvement. A high score on the quizzes indicates a high level of IT employee risk awareness and a low likelihood of creating serious security issues in application design and configuration