MEASURING INFORMATION
TECHNOLOGY’S SUCCESS
• Key
performance indicator – measures that are tied to
business drivers
• Metrics are detailed measures that feed KPIs
• Performance metrics fall into the nebulous area of
business intelligence that
is neither technology, nor
business centered, but requires input from both IT
and business professionals
EFFICIENCY AND EFFECTIVENESS
• Efficiency
IT metric – measures the performance of
the IT system itself
including throughput, speed, and availability
• Effectiveness
IT metric – measures the impact IT has on
business
• processes and activities including customer
satisfaction, conversion
rates, and sell-through increases
BENCHMARKING – BASELINE METRICS
• -
Regardless of what is measured,
how it is measured, and whether it is for the sake of efficiency or
effectiveness, there must be benchmarks – baseline values the system seeks to
attain
• -
Benchmarking – a process of
continuously measuring system results, comparing those results to optimal
system performance (benchmark values), and identifying steps and producers to
improve system performance
- Comparing efficiency IT and effectiveness IT metrics
for the government initiatives
THE INTERRELATIONSHIPS OF
EFFICIENCY AND EFFECTIVESS IT METRICS
- Common types of efficiency IT metrics
Efficiency IT Metrics
|
|
Throughput
|
The amount of information that
can travel through a system at any point.
|
Transaction speed
|
The amount of time a system
takes to perform a transaction.
|
System availability
|
The number of hours at system
is available for users.
|
Information accuracy
|
The extent to which a system
generates the correct results when executing the same transaction numerous
times.
|
Web traffic
|
Includes a host of benchmarks
such as the number of page views, the number of unique visitors, and the
average time spent viewing a web page.
|
Response time
|
The time it takes to respond to
user interactions such as a mouse click.
|
- Effectiveness IT metrics focus on an organization’s
goals, strategies, and objectives and include…
Effectiveness IT Metrics
|
|
Usability
|
The ease with which people
perform transactions and/or find information. A popular usability metric on
the Internet is degrees of freedom, which measures the number of clicks
required to find desired information.
|
Customers satisfaction
|
Measured by such benchmarks as
satisfaction surveys, percentage of existing customers retained, and
increases in revenue dollars per customer.
|
Conversion rates
|
The number of customers an
organization “touches” for the first time and persuades to purchase its
products or services. This is a popular metric for evaluating the
effectiveness of banner, pop-up, and pop-under ads on the Internet.
|
Financial
|
Such as return on investment
(the earning power of an organization’s assets), cost-benefit analysis (the
comparison of projected revenues and costs including development,
maintenance, fixed and variable), and break-even analysis (the point at which
content revenues equal ongoing costs).
|
- Security is an issue for any organization offering
products or services over the Internet.
- It is inefficient for an organization to implement
Internet security, since it slows down processing.
·
However, to be effective it must
implement Internet security.
·
Secure Internet connections must
offer encryption and Secure Sockets Layers (SSL denoted by the lock symbol in
the lower right corner of browser)
- Interrelationships between efficiency and
effectiveness.
METRICS FOR STRATEGIC INITIATIVES
- Metrics for measuring and managing strategic
initiatives include;
·
Website metrics.
·
Supply chain management (SCM)
metrics
·
Customer relationship management
(CRM) metrics
·
Business process reengineering
(BPR) metrics
·
Enterprise resource planning
(ERP) metrics
WEBSITE METRICS
SUPPLY CHAIN MANAGEMENT
METRICS
CUSTOMER RELATIONSHIP MANAGEMENT
METRICS
BPR and ERP Metrics
- The balanced scorecard enables organizations to
measure and manage strategic initiatives.
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