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Journal2011Sum-4.How to Implement Metrics for IT Service Management

ITFMA Journal

How to Implement Metrics for IT Service Management

David Smith, President, Micromation Canada


We are often too busy to ask for directions. Implementing a measurement framework should help align IT with the business objectives and create value through continual improvements. This helps us create a roadmap and keeps us from getting lost. In this article, David A. Smith presents such a framework.


Introduction

It’s often been said that "you can’t manage what you don’t measure", which is still true to this day. Without purpose and a course to follow, the destination is uncertain and almost always unpredictable. Many management books have been written on this subject, ranging from personal development to organizational leadership. They all agree in principle that a purpose, goal or destination must be determined in order to chart a course and path to achieve them. Once the path or roadmap has been defined, the journey must be carefully planned to guide the traveller safely to the desired destination in the prescribed time within planned costs.

Measurements are like navigational aids. They help identify the destination, the roadmap to follow, hazards to avoid, milestones to reach, fuel consumption, constraints or limitations, expected time of arrival, and so on. Without navigational aids, one could get lost, end up anywhere, get stranded, fall off a cliff, run out of fuel, get in an accident, or fall asleep at the wheel.

Goal of this article

The goal of this article is to provide the reader with a flexible and scaleable measurement framework which is easy to learn, implement, manage and improve. The goal of this framework is to provide process metrics and techniques to help align IT with the business objectives in order to create value. The framework is based on a continual improvement lifecycle and helps align IT with the business objectives and create value, making processes and services more "efficient and effective". It helps the reader determine ways to:

  • • align IT with business objectives and verify the results
  • • maintain compliance requirements for business operations
  • • drive operational efficiencies, effectiveness and quality

The measurement framework can be implemented as a comprehensive measurement program for all processes and services, or selectively for individual process or services. It is aligned with the IT Infrastructure Library (ITIL®), also a set of best practices. The framework is compatible with the Control Objectives for IT (COBIT®) framework and supports the ISO/IEC 20000 standard for IT service management.

More details can be found in the book "Implementing Metrics for IT Service Management" (Smith, 2008) ISBN: 9789087531140. The book provides methods, concepts, examples, techniques, checklists and software templates to accelerate adoption through a "how to" based approach.

What metrics are all about

Based on the book "Metrics for IT Service Management", a "metric" is just another term for a measure. Metrics define what is to be measured. For IT, this includes technology, processes and services. Metrics provide the feedback mechanism allowing management to steer, control and guide IT toward strategic objectives. The book further explains that metrics help to:

  • • align business and IT objectives
  • • achieve compliance(ITIL®, ISO/IEC 20000, COBIT®)
  • • establish operational excellence

Implementing metrics

Metrics for IT service management need to measure process and service effectiveness in addition to the functions and technologies that provide them. Metrics in IT have traditionally been measured in functionally-oriented silos like the help desk, server technical services or the operations department. Information technology departments are shifting to process- and service-centric organizational models requiring metrics which report beyond the functional boundaries to determine success. For example, both the application development and IT operations departments are functionally very mature and when independently measured, appear successful. However, they don’t work well with each other and together frequently fail to deliver deployments.

Basic concepts

There are four critical success factors for an effective measurement framework:

  • • enable validation of the strategy and vision
    • - aligned with the IT goals and objectives
    • - validation that alignment is working
    • - confirm goals and objectives are met
  • • provide direction with targets and metrics
    • - set targets through metrics
    • - control and manage the processes
    • - verify targets are being met
  • • justify with a means to gauge value realized
    • - justify performance improvements with a solid fact base
    • - quantify benefits realized
    • - communicate value realized with factual evidence
  • • intervene and provide corrective actions
    • - identify deviations when they occur
    • - understand the root causes
    • - intervene with corrective actions to minimize consequences

The measurement process

The measurement framework is broken down into a series of processes. The measurement process comprises four main sub-processes which repeat to form a continual improvement feedback loop based on W. Edward Deming’s Plan-Do-Check-Act cycle. The sub-processes of the measurement process are:

  1. Tuning (Plan) - The tuning sub-process is responsible for identifying improvement opportunities and recommendations for the subject process or service which is being measured. Note that the tuning sub-process can also act as the entry point for planning the measurement program and framework.
  2. Implementation (Do) - The implementation sub-process is responsible for implementing the recommended changes through normal change management processes. Note that the implementation sub-process can also act as the entry point for implementing the measurement program and framework.
  3. Monitoring (Check) - The monitoring sub-process is responsible for the data gathering, calculations and validation of the required measurements.
  4. Analysis (Act) - The analysis sub-process is responsible for comparative, causal and predictive analysis of the measurements to determine what corrective actions may be required.

There are two additional supporting sub-processes which provide administration and reporting:

  1. Administration - This sub-process is responsible for the administration of the activities associated with the maintenance of the metrics and measurement database (MDB).
  2. Reporting - This sub-process is responsible for reporting the findings and recommendations to management and various stakeholder groups, keeping them informed and aware.

Benefits

Measurements help improve performance, align goals and realize value. The positive benefits can be weighed against the negative consequences of not having a measurements program.

Benefits of a measurement program:

  • • provides the instrumentation necessary to control an organization
  • • direct focus on specific performance and control objectives
  • • easier to spot danger in time to correct it
  • • improves morale in an organization
  • • stimulates healthy competition between process owners
  • • helps align IT with the business goals and verify results
  • • drives efficiency, effectiveness and quality
  • • inspires continual improvements
  • • helps reduce Total Cost of Ownership (TCO)

Negative consequences of not having a measurements program:

  • • reduced visibility resulting in loss of control
  • • focus on "noise" instead of "what's important"
  • • reactive fire-fighting mode
  • • low morale in organization
  • • unhealthy political competition
  • • benefits not apparent or realized
  • • cost effectiveness not understood
  • • customer complaints drive improvements
  • • TCO not optimized
  • • increasing risk

Summary

Implementing a measurement framework should help align IT with the business objectives and create value through continual improvements. It helps us to create a roadmap and keeps us from getting lost.

The measurement framework acts as the map; meeting the business goals and objectives are the destination, the critical success factors provide the directions and the metrics provide the sign posts to keep you on course.

The measurement framework can be implemented as a comprehensive measurement program for all processes and services, or selectively for individual process or services.

Each organization may use this approach and the techniques discussed to create its own tailor-made measurement framework to improve its performance.


David A. Smith (Canada) is the President of Micromation Canada (www.micromationinc.com +1 705.792.5690) and specializes in TCO, IT Benchmarking, ITSM metrics and ISO 20000. He has thirty years of experience in management, measurement and improvement of IT systems, people and processes.

Literature

  • • Brooks, P. (2006). Metrics for IT Service Management. Zaltbommel: Van Haren Publishing.
  • • Deming, W. E. (1986). Out of the Crisis. Cambridge (MA, USA): MIT Center for Advanced Engineering Study.
  • • Kaplan, R., & D. Norton (1992). The Balanced Scorecard—measures that drive performance. Harvard Business Review, Vol. 70, No. 1, 71-79.
  • • Shewhart, Walter Andrew (1980). Economic Control of Quality of Manufactured Product/50th Anniversary Commemorative Issue. Milwaukee (USA): American Society for Quality.
  • • Smith, D. (2008). Implementing Metrics for IT Service Management. Zaltbommel: Van Haren Publishing. ISBN: 9789087531140

 

Copyright © 2011 by the IT Financial Management Association.

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