Putting IT on the Business Scorecard: Key KPIs for CIOs

By Roshan Shetty

In most companies, IT Departments have always been a bit like “the distant cousin” who knows how to fix the washing machine. Their very existence is only remembered when something goes wrong with it, and most times they end up being blamed for the initial problem.

The market self-healing momentum has led to the event of some supportive methodologies and frameworks which aim at promoting both the effectiveness of IT Services (in the case of ITIL) as well as the very place of the IT Department in support of the corporation (in the case of COBIT).

ITIL sets forward a framework that classifies and manages the lifecycle of key IT corporate assets (Configuration Items) whereas COBIT promotes proper workflows between the IT Department and the remaining corporate areas in order to leverage the potential that IT represents towards supporting effective Corporate Core Business processes and pain points.

Both frameworks are perfectly aligned with the LEAN Manufacturing and Operation concept as well as Continuous Improvement and Error Mitigation frameworks/ methodologies such as Six Sigma or Kaizen.

Constraints

The point is that while a Corporate Change Management Process (which implies investing time and money) towards going LEAN (by implementing herein mentioned methodologies such as Six Sigma or Kaizen), will add value and raise efficiencies throughout the entire organizational value chain’s scope; implementing COBIT, is primarily perceived as something that will mainly leverage (over an initial stage) the IT Department’s ability to better support the organization.

ITIL, on the other hand, shows a more direct beneficial line of sight since it can significantly contribute to map, monitor and improve organizational processes that directly impact Corporate Core Business (direct cost savings).

Now from a CIO’s standing point, while a manager in charge of assuring the performance of Internal Corporate IT Services, there is the vital need for having at his/ her disposal and on demand the main operational performance data pertaining corporate IT Landscape. This is achievable through the definition and establishment of mechanisms and processes that enable assertive measurement of Key Performance Indicators (KPIs).

On KPIs

A Key Performance Indicator is a measurable value that bears capital importance in demonstrating how a given system or process is performing towards meeting inherent established objectives.

KPIs are usually clustered in two groups that represent distinct levels of detail:

  • High-level KPIs – focus on overall performance and the added value to the organization.
  • Low-level KPIs – focus on the performance of specific systems or processes.

Now how can KPIs be developed?

Since KPIs serve the purpose of measuring the adherence towards established goals and objectives, one needs to begin by having those defined in an unambiguous and assertive manner.

The following step consists of picking each goal and objective separately and define:

  • What is the target and thresholds – target value and acceptable deviation
  • How to measure – where is the data coming from and how shall it be collected and stored.
  • When to measure – what is the measuring frequency that allows the best and most assertive data collection which assertively enables a view of

As an example, let’s pick an intuitive KPI that Go to the full article.

Source:: Business 2 Community

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