Measuring IT's Business Value
By Philippe Julio on May 24, 2008
IT Value Benefits are beyond Costs reduction, contributing to increase company's profitability
It's not easy to prove that an infrastructure gives business value to a company. I will try to answer at this difficult question.
To measure the IT infrastructure performance it is necessary to understand the performance indicator concept..
What is Key Business Value ?
- Focus on Industry : Bank/Finance, Government, Retail, Telco, Manufacturing...
- Business Value is Large : Stakeholder Value, Customer Value, Employee Value, Partner Value, Supplier Value, Managerial Value, Societal Value
- Key Business Indicators : Profitability, Revenue Growth, Customer Satifaction, Market Share, Cross-Sell Ratio, Marketing Campaign Response Rates, Relationship Duration...
- Common Language Management
- IT Portfolio
- IT Maturity
- Business/IT Alignment
- Intellectual Properties
- IT Process Automation
- IT Performance
- Service Level Agreement
- Key Metrics = Key Performance Indicators (KPIs)
- Technical performance indicators : CPU, I/O, SAPS, SpecInt, TPC-H, Availability Ratio, Time To Repair, Data Loss Ratio...
- Financial performance indicators : TCO, ROI, Depreciation...
- Ecological performance indicators: Space, Watt, CO2, RoHS Ratio, WEEE Recycling Ratio...
The Performance Lever is specific key performance indicator, it increases the system performance and it interacts with key indicators
It is a functional indicator, not technical !
- #Concurrent Users Indicator is a Performance Lever (Business Indicator)
- #CPU and #I/O are Key Performance Indicators
- Calculate #CPU = f(#Concurrent users)
- Calculate #I/O = f(#Concurrent users)
- Start a Provisioning Process automatically
- with #CPU and #I/O Values
- Activate #CPU and #I/O Cards with Capacity on Demand Process
- Integrate a new Web server with xVM Ops Center and N1 Service Provisioning System process
- Put technical captors in different points of the infrastructure via scripts, software…
- Gather technical, financial and ecological indicators values
- Integrate the native indicators values into the CMDB (My SQL for example because it's free software)
- Calculate the complex indicators with native indicators
- Analyse the results with reporting tool (StarOffice Calc for example because it's not a expensive solution)
- Compare the results obtained to the awaited results.
- Build a dashboard for CIO, IT Managers
- Infrastructure update with analysis results