Metrics Management | MANAGE BUSINESS RELATIONSHIP



Metrics are important for an IT organization to manage and control costs while ensuring the quality and value of service increases. Metrics are a key part of a managed process environment enabling cost reduction. Many organizations have great intentions when selecting and implementing metrics, but often fail for the following reasons:
  • The metrics and data are not actionable. For example, many organizations report the number of incidents they solved during the month. If the number of incidents was 100, or 200, what is the meaning of the number, and what are you able to do about it? If you change the metric to report the percent of incidents that were caused by changes, or the percent of changes that caused an incident, now you have a quality and resulting cost measure to impact. For any metric ask yourself if it is good or bad, and if you are able to do anything to affect it. If you cannot answer these questions, it is not a good metric to use.
  • The metrics are not meaningful. Metrics drive behavior. The problem is the wrong metrics drive the wrong behavior. Avoid this by making sure the business drivers are the foundation for your IT guiding principles and that you use the guiding principles to drive the metrics. Do this by asking how you will know when you have that attribute. One company identified a list of possible metrics based on the business drivers as shown in Figure 1. Metrics facilitate the realization and vision of a plan if you ask yourself, "How will we know when we achieve that?" For example, if a guiding principle is flexible systems, how will you know when you have achieved that? A good metric may be to measure the average time to make a modification to the system. Even better than measuring how fast IT completes requests, measure how many requests the business completes themselves. This would be flexible systems at their best.

    Key business drivers
    IT principle
    Resulting key metrics
    Implementation priority
    • Growth
    • Acquisitions, divestures
    • Agressive
    • Global potential
    Scalable
    • Performance (monthly)
    • % of service level agreements met (annual)
    • IT steering committee meetings (annual)
    High
    Low
    Low
    • Customer focused
    • Cross selling
    • Varied stakeholders
    • Desire for paperless
    • Remote offices and dispersed workers
    • Driven by key metrics
    Accessible
    • % of applications Web enabled (annual)
    • # of duplicate data groups (annual)
    • # batch interfaces (annual)
    Low
    Low
    Low
    • Breadth of business
    • Innovative
    • New products
    • Need to be nimble
    Flexible
    • # reusable components (annual)
    • Average time to complete requests (monthly)
    Low
    High
    • Competition
    • Price pressures
    • Business process improvement
    • Changing profitability curve
    • Capital constraint
    • Economic fluctuations
    Efficient and effective
    • % projects on time (qtrly)
    • % projects on budget (qtrly)
    • Internal client satisfaction (annual)
    • Help desk request satisfaction (monthly)
    • Post project review satisfaction (qtrly)
    • % of IT costs for maintenance (annual)
    • % maintenance as a percent of revenue (annual)
    • % of applications custom (annual)
    • # improved/paperless business processes (annual)
    • Average IT satisfaction rating (annual)
    High
    High
    High
    High
    High
    Medium
    Medium
    Low
    Low
    Medium
    • Regulatory
    • Privacy issues
    • Industry forces
    Reliable
    • Overall availability % (qtrly)
    • # audit findings (annual)
    • # disruptions by severity (monthly)
    • % abandon calls (monthly)
    • % calls resolved on first call (monthly)
    High
    Medium
    High
    Medium
    Medium

    Figure 1: Metrics example
  • Make sure the business executives and governance process are involved in selecting metrics that are meaningful to them so that you do not have to report endless amounts of meaningless data. If your goal is cost reduction, make sure that you reflect that in your metrics. However, in addition to efficiency, metrics that measure whether you are doing it well can also include effectiveness metrics that measure if you are doing the right things. This will ensure you do not cut costs or decrease value or service to the organization.
  • Make sure you do not have too many metrics. There is an endless amount of data that you are able to measure in IT. Keep in mind the 80/20 rule and focus on the data that is critical and meaningful. Work with the business to agree on what is meaningful to them. Less is more and fewer metrics drive focus. Too many metrics confuse employees on what is important. As the organization evolves and matures, you can add more metrics, but start small.
  • Publish and communicate the metrics. Some organizations make the mistake of using metrics at the management level but not communicating them to the entire organization. Make sure targets are attainable. Trend metrics to ensure you are heading in the right direction. Communicating the metrics on a regular basis will tell others it is important. Celebrate success.

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