Any business initiative or organisational activity needs to be measured. Employing some form of measurement in your business practices is essential because if it is done correctly, it can provide information that allows you to improve your business activities.
This will give your organisation the flexibility to hone its practices on an ongoing basis. Without it, an organisation can find it is not meeting its objectives without knowing why.
Overall, there are three things you can measure about any process: the efficiency with which it is delivered, the quality of its deliverables against specification, and how satisfied the end-user is with what has been delivered.
Obtaining these measurements is as important as any activity designed to realise the ambitions of a process, and IT is a prime facilitator of successful measurement, while also being something that needs measuring.
Generally, the role IT plays in the measurement process is to facilitate the rapid gathering, collation and processing of the information that is being measured.
At a more specific level, the proprietary and non-proprietary frameworks for measuring business performance make use of IT to apply a certain measurement methodology to the data: a methodology that could not possibly be applied manually.
IT is essential in this process, but you also need to measure the performance over given periods of time of your IT resources, such as availability, transaction costs, response times etc. This should include those IT resources you use in-house to monitor your business activities and provide management with information, and all the IT resources you use in your processes.
The IT function should be judged by the performance of the business processes it exists to support. All too often IT measures focus on the details of IT operations rather than on what really matters: its impact on the business.
The data generated by this process may be complex, involving large amounts of data, but the presentation needs to be understandable to make it useful for business managers.
To make the measurement most effective the data should be continuously updated and provide real-time performance information. Using mobile technology, this information can be made available to managers wherever they are and whenever they want - allowing the business to be truly responsive.
One popular measurement framework is known as the "balanced scorecard". This involves focusing on a group of key measurement themes and the development of performance indicators within them. Usually they focus on four key themes:
● End-user satisfaction (including external and internal users)
● Business processes
● Shareholder value
● Organisational learning
These themes provide a useful framework, but organisations have some flexibility in selecting themes, and themes can be modified or others can be added.
Another popular measurement methodology is known as six sigma. This focuses on measuring and eliminating errors in each stage of a process, with the aim of getting to an error rate of less than one error in 294,000. This gives confidence in the process to a level of six standard deviations, ie six sigma.
The overall aim of these measurement frameworks is then to "cascade" the measurement strategy throughout all areas and departments of the organisation - to generate key performance indicators and measurable objectives, the measurement and achievement of which will support the execution of the strategy.
Ultimately, whichever measurement strategy you opt for, the prime requirement is to build into the strategy a focus on the end-user and your processes, then develop the key performance indicators that will promote the right activities, and cascade them throughout your organisation.
Business software "dashboards" can also be programmed to show charts, gauges, graphs or traffic lights for the main key performance indicators that are relevant to each role, allowing for quick and easy interpretation of the performance information.
Each area of organisational activity or element in the business initiative could have different key performance indicators, objectives or dashboard layout depending on what processes they participate in or manage.
Whichever measurement framework your organisation chooses to employ, you should find that having the process in place will give you the information to improve your business and IT practices.
Measurement is a powerful business tool to help you work towards your objectives - without it you may find your objectives out of reach, without your knowing why.
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