IT Vital Factors, KPIs, and Scorecards

If you’ve ever attended a business meeting focussed on monitoring performance, you’ve heard all about profit, revenue, margins, net, gross, trends, etc. And yet, in the IT world these are rarely talked about in the same way. Yes, when layoffs come, we talk about the profitability of the company, but not the IT department itself. And yet, an IT department can make or break a company. If critical information is not available or if fundamental services experience a lot of down time, the effects can be crippling.

At Nelson, in recent times, we realized the value of having IT sit at the table discussing performance of the company. So there I was, sitting there among the VP’s discussing net margins for each of our business units. Then it came time to report on IT. My predecessor had set up a measure of sucess: Customer Satisfaction with the Help Desk.

First off, that’s not a bad start at all. Hell, just getting us a seat at the table with monthly reportable information was a huge step in the right direction. So lots of kudos go to him right there.

NOTE: If you manage an IT department, come hell or high water, get yourself a place at the table with the business leaders when they talk business numbers.

The next step, then was to report on something more meaningful. Yes, the Support group is deeply important to the company on a varietyof levels and for a number of reasons. And yet, that’s only a small portion of the group. Additionally, I question where “satisfaction” is a deeply motivating buisiness indicator. If a Support group is very friendly and outgoing, but takes a long time to resolve tickets, it may have a high satisfaction rating and yet still suck.

Our first task was to determine the breakdown of IT into services.

For Nelson, we broke it down as follows:
1. Support
2. Network & Infrastructure (Web Servers, DB Servers, Email, VoIP, Power, Cell Phones, …)
3. IT Business (Applications, Training, Analysis)
4. Development & QA
5. Professional Services.

We realized that some of the best measures for one set of services were not necessarily the best for another.

We realized that in order to measure our benefit of each service offering, we’d need to work with business people outside of IT to model what success looked like.

For example, we need to partner with Marketing to determine the value of our marketing sites on the business.
How much do those sites bring to the business?
What is the effect of down time?

Some of Nelson’s businesses are Staffing, we needed to track in very concrete terms:
How many people IT helped get placed?
How much time do we save the business folks?
How how much money from account executives’ sales can be attibuted back to IT?

When looking at IT, we chose two summary measurements to report up and outwards:
Dollar amount impact on the Enterprise
2. Number of minutes a service was down

The first of these will be detailed in another posting: How to Monetize IT.

The down-time, however, is a fairly straight forward thing to measure for IT groups. And thankfully, there are a number of tools that can be used to gather hard statistics for this. Note that we chose minutes of down-time instead of the more usual 99.7% up-time type reading. By using down-time minutes, we can see changes over time much more clearly than our uptime percent. Yes, that makes us more vulnerable and look worse, but it is more helpful in our attempts to acheive excellence.

Closing comments:

MeasuringĀ IT Business Impact is hard and daring, but if you carry it off, it will earn respect for the department and a seat at the table for import business discussion.


~ by naturarerum on February 8, 2009.

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