What does a drive from the airport to a hotel in Berlin teach us about effective use of metrics by IT? A lot.
As a passenger in a car last week, I was looking at the dashboard when a verbal warning alerted the driver that he was moving from an unrestricted speed zone into a controlled one. The driver slowed down, which was fortuitous as a police officer was waiting for speeding motorists. As we sat waiting for lights to change, the driver shared with me some of the car’s other features and mentioned that he had downloaded data from the car’s engine management system. Sure enough, when we got to the hotel, he proudly opened his laptop and showed me pages of data from the engine management system which as he explained showed the performance of the engine – more data than I have seen in some time.
IT professionals tend to think of metrics as a means of measuring system performance, often without a relationship to how those metrics are used to run the business. The secret sauce is to understand the business connection to IT metrics, identify the meaningful ones and use a suitable proxy for service management. This includes a review of how other technology industries use proxies for service measurement, capacity planning, and finance.
For instance, think about the power generation industry, which uses a commonly known metric or proxy–the kilowatt hour–to calculate power supply and delivery charges. Many power companies, such as mine, deliver bills that include the average temperature and consumption over the last 12 months. That’s a big help. And with the upcoming installation of a smart meter, I will have information to make decisions on consumption on a real-time basis.
To be relevant, IT organizations need to deliver visual dashboards that provide insight on the performance of the organization. I am often asked how to deliver effective dashboards. My recommendation is to design dashboards that show information that can easily be understood by those who will use it to make actionable decisions and deliver their role effectively. Therefore, the dashboards will be the context of the position and role of the individual(s) using them and the outcome should drive a decision and behavior that will drive business success.
Here are some initial questions to ask when creating dashboards to help drive business outcomes:
- What is the role within the organization of those that will be using the dashboard?
- What will be the decisions that should be made based on the dashboard?
- When and where will the dashboard be used?
- What are the 3 most critical metrics that the role is concerned with?
- What would be a suitable proxy for measurement that the recipient can communicate with their peers\management?
If you need some guidance on where to start, I suggest that you look at the four domains within the generic balanced scorecard – you can see a sample of this within ISACA’s COBIT 5 Framework publication, where you will notice a number of organizational domains where you can drill down to drive value. At minimum, I suggest that you measure the performance of your services in business terms, financials and some people metrics that add relevance to the business. Don’t forget to color code and, of course, keep it simple!
My final piece of guidance is that, after meeting with the business and agreeing to no more than 10 to 15 total metrics, create a mock-up the dashboard and gain agreement from the stakeholders.
So as you begin your metrics journey, don’t forget that it will change over time. If you have any great examples of metrics that you’d like to share, feel free to add a comment to this post or tweet me (@RobertEStroud) a link!
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