Why IT Loses the Metrics Game


Not too long ago we published an eye-opening interview with IT benchmarking pioneer Howard Rubin, who talked, basically, about what businesses and IT departments were doing wrong with metrics.

(You can see more from Howard here.)

The interview was also a timely one, as the economy teetered on the edge and report after report predicted gloomy IT budgets. But perhaps even more importantly, Rubin shed more light on the difficult business of metrics and performance measurement, a business that the business (and IT) often does completely wrong.

Forrester recently weighed in on the issue with a report titled "The Five Essential Metrics for Managing IT." In it, analyst Craig Symons and his colleagues make a point that most IT pros know but hesitate to admit: "Most IT metrics efforts lack relevance to the business and are not well linked to business outcomes."

So, what to do? Forrester suggests focusing on these five metrics for IT to create a scorecard that won't put it on business' chopping block (see the report for graphs and in-depth explanations):

1. Alignment of IT investments to business strategy 2. Cumulative business value of IT investment 3. IT spend ratio - new versus maintenance 4. Critical business service availability 5. Operational health

What do you think? Will this scorecard help IT's reputation with the business? Tell us in the comments section below.


4 Comments for "Why IT Loses the Metrics Game"

  • Richie Lam May 07, 2008 11:59 pm

    The list isn't bad but there seems to have a mismatch in the levels. Items 1, 2 & 5 are good and fit into strategic perspective, whereas 3 & 4 are more of the operating metrics. Besides, 4 seems to be a subset of 5. To me, there also require some spending/project efficiency measures.

  • CarlS April 10, 2008 5:30 am

    Items 1, 4 and 5 are a must. Need to have a capex/opex, headcount view. Need to have open/closed/pending projects reporting with fixed deliverables and on time attainment metrics. Bugs/issues/resolutions reporting. I have found this series of reports lets the business know that IT is delivering on business objectives and within fiduciary responsibilities.

  • DaveB April 09, 2008 11:42 pm

    These are good metrics, but the biggest question is always - how do you measure #2? IT initiatives can be so intertwined with business initiatives, that I find many IT departments struggle with what should be included.

  • CEO Pundit April 09, 2008 4:15 pm

    Good list, couple of comments: 1. The 'alignment' metric is a breakout of 'new' vs. 'maintenance.' In other words, what % of 'new' clearly advances the strategy. 2. Point 4 & 5 are measured the same way. I think you boil them down to a single metric.

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