The issue: Deciding which IT activities to measure to
provide meaningful insights
The question: I have always believed in 'doing' rather
than self-monitoring, but reluctantly agree that the IT department
needs to provide meaningful metrics on its activities. We have no
shortage of things to measure, but how do we decide which are the
most effective use of our time and energy?
Consult your users to discover what is important to
them
Ben Booth, Elite Group
Metrics can be a useful way of finding out in an objective way
how you are doing, and of communicating this both internally and to
your users.
If you do not know already, I would start by consulting your
users and stakeholders on what it is that really matters to them
about your service.
This might include helpdesk responsiveness, system availability,
tracking of development projects against plans and financial
performance.
Once you have decided what is important, look at how it can be
measured and reported in a way that is both meaningful and not too
complex to collect.
My suggestion would be to have half a dozen measures, and to
report them by a traffic light system of green, amber and red.
Do not try to be too sophisticated, and do not fall into the
trap of reporting "techie" measures, which are of no significance
outside of the IT department.
On a regular basis you should do a reality check with users and
stakeholders to ensure that the metrics are still valid.
Ben Booth is chairman of BCS Elite, a forum for IT directors
and senior managers to discuss how to manage IT to achieve business
objectives.
Look at metrics that demonstrate the effectiveness of
IT
Robin Laidlaw, Computer Weekly 500 Club
There are some metrics you have to provide to ensure compliance,
for example, but there is concern being expressed in the industry
that there is an unnecessary proliferation of such
measurements.
Try looking at metrics that will indicate how successful the IT
directorate is in helping your organisation improve its
profitability and reduce its costs.
Also look at those measurements that indicate your effectiveness
in helping your organisation meet its other business needs and
obligations.
Always remember that IT is integral to the business, and the
business' success or failure may well depend on the effectiveness
of its IT operations.
Reluctantly agreeing to provide some metrics does not sound like
an IT director who considers themself a fully participating member
of the company's senior management team.
Robin Laidlaw is president of the Computer Weekly 500 Club,
a networking forum for CIOs. He was formerly IT director at British
Gas.
Find out what matters in terms of reporting to the
business
Roger Rawlinson, NCC Group
You need to be able to demonstrate that you are delivering to
the requirements of the organisation, so it is important that your
measurements are linked to business outcomes.
The fact that you are not sure what to measure suggests that you
do not know what that your priorities are.
Having plenty of things to measure is fine, but you really
should know what actually matters in terms of reporting to the
business.
I suggest that you consult with the user community, speak to the
senior managers, canvas their staff, and find out what they need in
terms of delivering to the requirements of the business.
This will also assist you in updating and maintaining an IT
strategy.
One way to help this process is to consider what metrics you
would want from a supplier if you were outsourcing your IT to them
- what metrics would you require in order to measure their ability
to meet business outcomes.
Roger Rawlinson is director of IT consultancy at NCC Group,
an independent provider of IT security, assurance and consultancy
services.
Fewer, simple measures are better than complicated
approach
Andrew Whiter, Ernst &
Young
Measuring IT’s contribution to the business is to everyone’s
benefit and is a really positive step towards raising the profile
of IT in the boardroom, as well as a powerful tool for day-to-day
IT management.
It is only through clear goal setting and appropriate
measurement that you can demonstrate and communicate,
unequivocally, the value that IT delivers to the business. The
alternative is misunderstandings and frustration.
Choosing what to measure should be driven first and foremost by
overall business priorities and goals.
IT measures should then be developed and worked on and agreed
between IT and the business, as getting buy-in, common
understanding and commitment is critical to getting IT measures
that are aligned to relevant business measures.
In general, fewer measures are better that many, and simpler,
easy to understand ones are better than complex ones.
Be prepared to approach the business with an outline measurement
framework.
Business drivers of IT generally fall into a few typical
categories: regulatory compliance, risk management, business
process delivery/improvement, and IT cost effectiveness.
Do not fall into the trap of measuring only what you can – ie
what is available instead of what you want – or articulating
measures in IT terms.
Remember, the primary purpose of measurement is to facilitate
communication and understanding.
Focus on how IT is supporting strategic business
objectives
Chris Potts, Dominic Barrow
This is a golden opportunity to demonstrate to yourself and
others the extent to which you see yourself as a core member of the
company’s management team, or simply as a provider of IT services
to everyone else.
Primarily, you should be measuring the company’s performance in
exploiting IT investments through their contribution to the
business strategies and operating plans, and the costs of that
contribution.
For example, to what extent is the company achieving its
strategic business objectives for IT investments? How effective are
business innovations using IT to create new value? And are the
future bottom-line costs of IT being effectively managed and
exploited?
Of secondary importance, and probably only of real interest to
the IT organisation, are “supply-side” measures. These are about
the provision of IT services and are founded on industry standards
and benchmarks such as the IT Infrastructure Library.
If you focus on, and publish, supply-side measures, it will seem
obvious to people that you value yourself primarily as a
quasi-supplier and they will probably treat you accordingly.
Whatever balance you choose to strike between exploitation and
supply-side measures, no business executive I know wants
measurement to be a “cottage industry” in itself.
Therefore it is vital to find the fewest and most economical set
of measures that give an end-to-end picture of performance.
Implement a balanced scorecard for evaluating
performance
Sharm Manwani, Henley Management
College
You say that you “reluctantly agree” that some meaningful
metrics are needed, however, it is not clear where the push is
coming from or why. Hence a good place to start would be to ask why
you want to have measures.
One potential reason is to establish metrics that assess your
internal efficiency and productivity.
Here you might look at how many standardised system tests you
can perform per individual, or how many helpdesk calls you handle
per individual.
By comparing productivity measures over time, and potentially
with other organisations through benchmarking, you can assess
whether your internal performance is improving. If there are cost
pressures, you are likely to get support from the finance director
for this type of measure.
Alternatively, the pressure may be more on metrics for
responsiveness to internal customer demands. For example, how long
does it take to complete customers’ calls to their satisfaction? Or
how many projects are delivered to specification on time within
budget?
One way of responding to multiple demands for measures is to
implement a balanced scorecard which is a business tool for
evaluating both financial and non-financial performance. Here you
can combine financial, customer, process and learning objectives in
one assessment tool.
Whichever measures you select, you should be clear on your
target audience and their goals, as well as your own.
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