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.
that is neither technology, nor business centered, but requires input
from both IT and business professionals.
Benchmarking - Baselining Metrics
Benchmarking
- a process of continuously measuring system results
- a process of continuously measuring system results
- Comparing those results to optimal system performance
(benchmark values)
- Identifying steps and procedures to improve system performance.
(benchmark values)
- Identifying steps and procedures to improve system performance.
The Interrelationships of Efficiency and Effectiveness IT Metrics
o Throughput
o Transaction speed
o System availability
o Information accuracy
o Web traffic
o Response time
Efficiency IT metrics
§ Throughput
- the amount of information that can travel through
a system at any point.
a system at any point.
§ Transaction speed
- the amount of time a system takes to perform a transaction.
- the amount of time a system takes to perform a transaction.
§ System availability
- the number of hours a system is available for users.
- the number of hours a system is available for users.
§ Information accuracy
- the extent to which a system generates the correct
results when executing the same transaction
numerous times.
- 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.
- 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
- time it takes to respond to user interactions such
as a mouse click
- time it takes to respond to user interactions such
as a mouse click
The Interrelationships of Efficiency and Effectiveness IT Metrics
Effectiveness IT metrics focus on an organization’s goals, strategies, and objectives and include:
- Usability
- Customer satisfaction
- Conversion rates
- Financial
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.
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 a browser)
Secure Sockets Layers (SSL denoted by the lock symbol in the
lower right corner of a browser)
Metrics for Strategic Initiatives
ü Web site metrics
ü Supply chain management (SCM) metrics
ü Customer relationship management (CRM) metrics
ü Business process reengineering (BPR) metrics
ü Enterprise resource planning (ERP) metrics
Ø Abandoned registrations
Ø Abandoned shopping cards
Ø Click-through
Ø Conversion rate
Ø Cost-per-thousand
Ø Page exposures
Ø Total hits
Ø Unique visitors
Supply Chain Management Metrics
ü Back order:
an unfilled customer order. A back order is
demand against an item whose current stock
level is insufficient to satisfy demand.
an unfilled customer order. A back order is
demand against an item whose current stock
level is insufficient to satisfy demand.
ü Customer order promised cycle time:
the anticipated or agreed upon cycle time of
a purchase order. It is a gap between the
purchase order creation date and the requested
delivery date.
the anticipated or agreed upon cycle time of
a purchase order. It is a gap between the
purchase order creation date and the requested
delivery date.
ü Actual cycle time:
the average time it takes to actually fill a
customer’s purchase order. This measure can be
viewed on an order or an order line level.
the average time it takes to actually fill a
customer’s purchase order. This measure can be
viewed on an order or an order line level.
ü Inventory replenishment cycle time:
measure of the manufacturing cycle time plus
the time included to deploy the product to the
appropriate distribution centre.
measure of the manufacturing cycle time plus
the time included to deploy the product to the
appropriate distribution centre.
ü Inventory turns (inventory turnover):
the number of times that a company’s inventory
cycles or turns over per year. It is one of the most
commonly used supply chain metrics.
the number of times that a company’s inventory
cycles or turns over per year. It is one of the most
commonly used supply chain metrics.
Customer Relationship management metrics
Customer relationship management metrics measure user
satisfaction and interaction and include:
satisfaction and interaction and include:
- Sales metrics
- Service metrics
- Marketing metrics
BPR and ERP Metrics
- The balanced scorecard enables organizations to
measure and manage strategic initiatives.
measure and manage strategic initiatives.
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