An IT steering committee is concerned that enterprise technologies have grown stagnant and are outdated. Which of the following is the BEST strategy to invest in modern technology?

The BEST strategy is a governance-level action that embeds the desired change into the enterprise's processes. Creating a new investment category for innovation establishes a formal, strategic mechanism for the IT steering committee to prioritize, fund, and track modernization efforts. This approach aligns with IT portfolio management principles, ensuring that overcoming technological stagnation becomes a deliberate and sustainable part of the enterprise's investment strategy. It directly addresses the committee's concern by creating a dedicated channel for funding new technology, separate from day-to-day operational spending, thereby ensuring focus and accountability for modernization.

A. This is a tactical budgetary action that would result from a strategic decision, not the strategy itself.
B. Redefining the target architecture is a planning activity; it identifies what to invest in but does not create the investment strategy or funding mechanism.
D. Updating the HR plan is a necessary supporting activity that follows the decision to adopt new technologies, not the primary investment strategy.

1. ISACA, COBIT 2019 Framework: Governance and Management Objectives. The management objective APO05 Manage Portfolio includes the practice APO05.04 Manage the investment portfolio. A key activity is to "Establish a target investment mix (e.g., proportion of investments in innovation/growth vs. run/maintain) based on the enterprise strategy and goals." Creating a new category for innovation directly implements this best practice.

2. ISACA, CGEIT Review Manual, 8th Edition. Domain 2, "IT Resources," emphasizes the importance of IT portfolio management to ensure resources are optimized to achieve enterprise objectives. Task Statement 2.4, "Direct IT portfolio management to ensure alignment with the enterprise's strategic objectives," directly relates to the steering committee's role in creating investment categories to drive strategic change.

3. De Haes, S., & Van Grembergen, W. (2015). Enterprise Governance of Information Technology: Achieving Alignment and Value in Digital Organizations. Springer. Chapter 4, "IT Portfolio Management," describes the practice of categorizing IT investments (e.g., run, grow, transform) as a fundamental IT governance mechanism to ensure strategic alignment and value creation. Creating an "innovation" category is a direct application of this principle. (DOI: 10.1007/978-3-319-14547-1)