October 28, 2015
by Chris Curran
Speed, innovation and security are more important than ever as digital disrupts the enterprise.
One of the most highly sought after posts on this blog has been “10 Metrics for a New CIO.” Since the post was written five years ago, the CIO role has undergone dramatic change. Speed, innovation and security are more important than ever as digital disrupts the enterprise. Following are 10 metrics that today’s successful CIOs are tracking. What would you add to this list?
- Velocity of idea-to-offer cycle: PwC’s CEO survey highlighted the increasing speed of change in business models. With change, it is important for the CIO to measure overall velocity as a concept goes from business idea to a production system. While not perfect, measuring the number of releases per year per application is an easy way to track this velocity.
- Quality of idea-to-offer cycle: One of my favorite CIOs used to say that “an over-budget project gets a CIO in serious trouble, a poor quality go-live gets a CIO fired”. Seasoned CIOs measure the number of issues per new launch, normalized for size by hours or dollars spent on the project. They also track the quality by teams/project managers to find ways to learn from their best performing assets.
- Business Value: Organizations need to measure Business Value in terms of three key performance areas: Revenue Growth, Cost Reduction, or Cost Avoidance. Creating a common taxonomy of tailored metrics around these three areas will guide and prioritize investments, and improve controls for timely delivery and decision making.
- End User Satisfaction: There are a number of ways to measure satisfaction with IT: surveys, focus groups, etc. Pick what works best for your company culture and use it because radio silence from your users does not always mean happiness. Make the metrics available to business leadership – at a minimum, they will appreciate the fact that you are tracking it and consciously working toward improvements.
- Process Fragmentation: Today’s data intensive, information based business decision making has exponentially increased the demand for real time business intelligence. Mega processes, such as order to cash, supported by disparate systems hinder a CIO’s ability to deliver that information. CIOs should track the number of solutions supporting each mega process to ensure aligned, timely data.
- IT Financial Maturity: Today’s CIOs are asked to run a value driven organization that aligns IT spending to corporate objectives and efficiently manages Capital vs Operational spend. Maintaining year over year productivity measures such as FTE, sourcing mix, and technology spend versus revenue/number of employees is a good starting point to assess IT Financial Maturity. Seasoned CIOs tend to include more mature analysis such as the ones mentioned before.
- Security: Metrics on patching, password strength and compliance are important, but don’t always translate well to business executives. An alternative is to measure metrics that can be understood easily such as total number of network intrusion attempts thwarted per year, number of security breaches (if any) by extent, etc.
- Critical outages impacting business: This is a direct measure of critical outages that could have significant impact on business operation. It is important to define what constitutes a critical outage, based on either % of revenue impacted or % of employees affected.
- Average hours to close tickets by type: Another classic metric that measures average close time. An alternate approach could be to measure response time to an issue. However, response time has to be defined with care and should not be perceived as “first response” ticket logging and assignment by a helpdesk resource.
- Business Alignment: IT leadership’s number one priority is to serve the business, which can only be done effectively when IT leadership spends time with business leadership. Successful CIOs encourage, and track, the time spent by their direct reports “in the field” talking to their respective business owners versus “office time” focused on internal activities.
As CxOs compare internally provided IT services with external alternatives, CIOs should demonstrate value provided by internal IT. Measuring, improving, and showcasing key metrics can help establish the value to business and justify the investment in information technology.
What challenges do you see in tracking these KPIs? What other metrics does your organization track? Share your thoughts with us.
Image shared by Alden Jewell.
This article was originally published by Suheb Siddiqui on CIO Dashboard.