IT departments are failing to measure their own performance or service levels to the business, according to new research. Without such basic measure in place, IT departments risk having their major functions outsourced.
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An independent survey, commissioned by IT services provider Dimension Data, found that companies rarely strove to measure the performance of IT.
From around 200 in-depth interviews, independent research firm Coleman-Parke, found 32% of all companies do not have any service level agreements (SLAs) in place to measure IT department activity against a specific target.
Of those with SLAs, only 41% of CIOs report they are regularly monitored and 43% regularly report on the SLAs. Overall, those with SLAs do not appear to be undertaking a robust level of measurement and monitoring, with only one-quarter of companies using SLAs based around end–to-end measurement of service, researchers said.
The most commonly used measurements for SLAs are non-financial business impact measures (67%) followed by technical performance measurements (59%).
The research also found few line of business managers had a direct relationship with the IT departments which their work ultimately funds.
Thirty five per cent of CIOs said they had a comprehensive and integrated set of tools monitor and manage key performance metrics, such as network capacity and application availability. Half of respondents described their operations management tool set as “partial” or “inadequate”.
IT departments that are largely seen as a cost centre and are unable to demonstrate the level of service they provide to the business, become vulnerable to external IT service providers who are well versed in SLAs and delivering value, said Terry Wilson, business development director for operations management solutions with Dimension Data.
John Holden, senior research analyst with the Butler Group, agreed that IT departments that did not measure their performance and service level to users were ripe for outsourcing.
Other pressure for greater transparency of IT performance comes from increasing awareness of the need for effective corporate governance, Holden said. “There is increasing recognition that IT is having to contend with increasing scrutiny from business. Service levels should be part of a cyclical culture between IT and business units.”
Although these ideas had been around for 30 years Holden said he was unsurprised that they were not always taken up. IT directors and CIOs who ignore these warnings risk losing their influence within the organisation or even losing their jobs, he said.