How does IT measure up in your organization?

Are you content with the way IT is viewed in your organization? If not, you need to study the work of Dr. George Westerman, a Research Scientist in MIT Sloan's Center for Digital Business (CDB), who suggests you rethink the metrics you measure and how you communicate IT's value. 

Also read: Revitalizing IT's worth

Westerman recently teamed with Saby Mitra, an associate professor in Georgia Tech's College of Management, and Vallabh Sambamurthy, professor of Information Technology in Michigan State's Eli Broad College of Business, to publish a study with the Society for Information Management's (SIM) Advanced Practices Council titled "How do CIOs measure and communicate IT performance?" 

Are you content with the way IT is viewed in your organization? If not, you need to study the work of Dr. George Westerman, a Research Scientist in MIT Sloan's Center for Digital Business (CDB), who suggests you rethink the metrics you measure and how you communicate IT's value. 

Also read: Revitalizing IT's worth

Westerman recently teamed with Saby Mitra, an associate professor in Georgia Tech's College of Management, and Vallabh Sambamurthy, professor of Information Technology in Michigan State's Eli Broad College of Business, to publish a study with the Society for Information Management's (SIM) Advanced Practices Council titled "How do CIOs measure and communicate IT performance?" 

Network World Editor in Chief John Dix caught up with Westerman at his MIT office to hear what the team learned from the 23 CIOs they examined for this SIM study.

In your research with Mitra and Sambamurthy you explore how IT executives can achieve more success by focusing their efforts on driving business value. Give us the elevator pitch.

GW: One of the biggest failings in IT's ability to deliver value is not being able to talk about value, not being able to get beyond classic IT metrics that nobody else cares about. So what we've done in this research is show the right way to talk about value and how you move up the value hierarchy.

We asked the question, how do effective CIOs talk about value and what's the process they use to become more effective? We find that, first, there's a translation to take the IT metrics and make them meaningful for people. But that's just the start. Once you've done that and you've got some credibility on delivering the IT work, then you want to move to business metrics for your operations and project benefits delivery. Then CIOs are able to move into the innovation and strategic IT value space from there.

What metrics do successful organizations collect?

GW: Many people publish the metrics that are easy to get: availability statistics, project on-time measures, these kinds of things. But in our case studies we find that, as you get beyond a basic level of goodness in IT, nobody cares about those measures. They really care about what we are doing to improve the business. And most IT people aren't providing those numbers. They're critical, but harder to get.

In our study with SIM APC and 23 CIOs, we found there are three categories of metrics to measure. One is operations metrics, how well is the company running. No. 2 is project metrics, how well are we changing the company. And three is innovation metrics, how ready are we for the future [picture a matrix with these being three categories along the X axis].

Within each of these categories there are three levels of metrics [the Y axis], with the bottom one being IT. So typically the value conversation, if it's happening at all, involves very technology-specific numbers - how many nines, how high is user satisfaction with the help desk. But CIOs succeed better when they're able to move up to the two higher level business metrics in each category.