KPIs

Using KPIs and Metrics to Demonstrate IT’s Business Contributions

KPIs and Metrics IDC Blog

For CIOs, metrics are a key means of measuring the performance and effectiveness of their IT organizations in support of organizational improvement. During the recent IDC web conference ” New Metrics & KPIs for the Digitally Transformed IT Organization,” my colleague Bill Keyworth and I shared the results from our latest IDC MeasureScape survey and discussed new metrics and KPI’s for digitally transforming IT organizations working on infrastructure modernization and cloud adoption.

As organizations are going through business transformation, there are tremendous changes to the rules for IT measurement. CIOs need to rethink how they measure the performance of IT, moving from “counting” metrics that measure IT efficiency and output to measures of business impact and value. It is essential to measure the speed, agility, quality, predictability, and experimentation of integrating innovations to the enterprise’s at-scale, mission-critical IT operations. We see most organizations starting to capture, measure, analyze, and report metrics for their IT “business” or technology functions. However, our research finds that less than one-fifth of organizations have integrated their IT metrics and benchmarks with other corporate measurements to demonstrate the contribution of IT.

As digital transformation continues to intensify the demands placed on IT organizations, IT organizations must change their approach to IT measurement to focus on what really matters to the business — not just to IT.  IT organizations need to have differentiated measurement to:

  • Create digital innovations: Business innovation is not a one-size-fits-all phenomenon. IT leadership must integrate technologies and architecture that map to the kind of innovation — disruptive, adaptive, or incremental — that business leaders adopt.
  • Enable cultural changes: Measurement of technology adoption must accommodate the cultural changes driven by the speed, agility, and predictability inherent in delivering new DX products and services.
  • Align with business goals: Existing reactive implementation processes and metrics focused on efficiency of infrastructure, applications, and components continue to be inherently disconnected from critical business goals.

IDC predicts that by 2019, 80% of surviving IT organizations will adopt new IT metrics that ensure IT spending is driving digital transformation, business value, and line of business performance. Business leaders don’t directly care about closed help desk tickets or system uptime. They care about how IT ultimately helps grow the business and compete on the digital battlefield.

For more guidance on KPIs and metrics in the IT organization, click here for the latest on-demand web conference.  

Suya Xiong is Research Manager for IDC’s IT Executive Programs.

Visit idc.com/itexecutive for more resources geared towards the IT and LOB leadership teams and information on research from IDC’s IT Executive Program.

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