Performance Artist

Performance Artist

Business performance is the measure of IT value — full stop

The lesson of the exercise machine analogy is this: Do not report to business executives on the technical minutiae of operations; report on how IT operations are affecting business performance gains.

To realign these conversations, identify critical business performance metrics. This step requires participation by business executives, because IT staff can't assume that they know which metrics are most important to executive and business unit management. Critical metrics may be operational, financial, compliance-oriented or fall into some other category. Execute this step at the start of the program or when substantial change occurs in the business.

Next, tie IT metrics to business performance metrics. Identify specific IT operational measures, such as unplanned network or server downtime and correlate them to comparable business metrics. Or combine multiple IT metrics to produce a single business metric. For example, combine network availability with desktop availability and other measures to measure call centre agent availability. Or use ratios to correlate IT metrics to business performance metrics by, say, calculating the cost of IT operations per business user, new customer account or sale.

Credibly communicate the benefits of IT investments. When communicating the benefits of IT investments, take care to avoid the baseless, outright sales pitch syndrome that tries to gloss over obvious defects. Even in companies where executive management understands that IT is essential to the business, CIOs must continually show that IT delivers value for money right where it counts - in improvements to business performance.

Beware, though, of this potential value trap: "IT Doesn't Deliver." Nothing destroys credibility and influence faster than unreliable delivery of services and initiatives and poor management of the business initiative pipeline. As one CIO who contributed to our research said: "Reliability liberates you to talk about the business. It's not the end game." Equally egregious is confusing IT risks with business risks. They aren't the same thing.

Also, key to credibly communicating the benefits of IT investments is benchmarking and setting guidelines for performance. The business can't appreciate IT value-for-money until it knows how the IT organization is performing relative to its peers.

Several companies that contributed to our research benchmark annually or biannually to establish a baseline for IT performance. Other companies included in our research also report against benchmarks to demonstrate progress in a turnaround situation. All the companies expect to report IT organizational performance forever to demonstrate that IT's value is high and rising.

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