Basics for IT Management Metrics
Defining Metrics First Steps
Most IT metrics efforts lack relevance to the business and are not well linked to business outcomes. They tend to be IT focused, such as WAN availability or server downtime. It is difficult for the business to understand how these measures relate to its objectives, and they provide little insight into the value that IT delivers.
CIOs must create a scorecard and service level agreements that:
- Relate to the enterprise and its management team. Server availability, network throughput, help desk call volumes, capacity utilization, and other IT operational metrics are not relevant to business executives. These types of metrics need to be translated into something enterprise management understands, such as availability of business applications or the cost to support a business area. The IT-operational metrics should be kept within IT unless they can be put in enterprise terms.
- Relate to the enterprise strategic and tactical objectives. Enterprise executives are concerned with introducing new products and services, improving customer loyalty and satisfaction, increasing gross margins, and growing market share. IT metrics must be linked directly to these enterprise objectives, specifically demonstrating how IT initiatives contributed favorably to improving them.
Balancing Key Business Needs
Managing the IT environment is a complex challenge that requires attention to three primary business metrics: cost, service, and risk.
IT Staff salaries account for the major direct cost of the IT Organization. The IT staff performs a specialized role in most enterprises and is generally well compensated as a result.
Enhancing the productivity of the IT organizational team is essential to maximizing cost effectiveness. Tools that automate tasks via an intuitive user interface are often the first step toward improving IT productivity. For IT staff managing critical applications and databases, productivity is widely measured by the number of applications and databases they can manage while maintaining service levels.
IT applications and databases carry a service expectation that is either implicitly understood by the administration teams or formalized into a service level. Service levels are usually defined by the application team and passed on to the administrators of each asset in the application stack. Given the vital role of the applications and databases, the service level the IT team inherits is aligned to application criticality and is typically measured by availability and response time.
The centralized nature of applications and database relative to the other components in the application stack makes it highly sensitive to change - and with change comes risk. Moderate-risk changes are small and incremental (e.g. operating system upgrades, application and database patches and regular maintenance tasks like backup, data archiving, and object reorganization).
When larger changes are required, however, the risk to application and database stability is much higher. Significant upgrades to server hardware often require downtime, but upgrades to the application code or to a new major release of the database carry the added risk that application performance may become slower as a result of the change.
Balancing these factors requires intuition, good judgment, and accurate data. The CIOs biggest challenges is to justify staffing and spending levels as they strive to improve IT efficiency. When assessing comparative benchmarks, it is hard to know which metrics to start with. The Metrics for the Internet, Information Technology and Service Management HandiGuide helps CIOs to understand and pick the appropriate comparative benchmarks to justify staffing and spending, improving IT operations and demonstrating the value of IT to the business.