Thursday, May 1, 2014

Practical guide to measuring IT services based on business outcomes


Are you part of an IT service organization managing a large portfolio of IT systems to customers? If so the below questions would be of interest to you

  • How do you ensure that IT is delivering all that business needs? 
  • Are you confident that measuring software systems by its IT SLA is good enough to ensure that business effect is delivered?
  • Have you ever tried to measure IT systems based on the business outcomes they are delivering?
The above questions become very important when 
  • IT systems landscape is very complex - especially when there are several legacy systems (upstream & downstream) together fulfilling the business needs. 
  • There are several players in the supplier organization - multiple product vendors , different suppliers for each layer : help desk , application , middle ware , hardware, network etc.
  • No single point of accountability within the customer IT organization
The most probable outcome of the above would be - each supplier delivering services as per their SLA(service level agreement) but end customer complaining that their business effect is not delivered. This is certainly not a desirable situation as the service reports are supposed to throw light on any customer dissatisfaction.

A normal IT service reporting mechanism tends to report something like this 

  • How many incidents were raised for a duration with severity and priority
  • How soon the tickets were resolved 
  • The status of ongoing incidents , problem investigations , changes etc
  • The system availability statistics (planned & unplanned downtimes)
This sort of a report probably helps an IT organization to understand what is going on , but does it say anything about the 'value' of the services?

It is probably appropriate to remind the definition of a 'service' to understand what we are lacking here : 
Service is a means for delivering value to its customers by facilitating outcomes without the ownership of the associated costs and risks

Does the above sort of report reflect the value of IT services to business.. does it even help an IT leader to understand what is the business effect his/her organization is delivering? The answer is "No".  An IT service report which does not talk about the value & outcomes delivered does not offer much to understand the real satisfaction of  the customer.

Next >> How to measure business outcomes?