Business Metrics

The Five-Step Framework for Business-Oriented Metrics

Some people like to build piece by piece, and others like to have the full blueprint in mind from the beginning. Phyllis Drucker might lean toward the latter, providing a five-step framework for devising the best metrics in an article for the ITSM Review. Following these steps just might demystify the whole measuring process.

Five Frames

  1. Create a focus group.
  2. Understand the vision and goals of the organization.
  3. Identify your audiences and their contribution.
  4. Make the goals measurable.
  5. Build the dashboards and scorecards.

Alignment of goals is always critical, which is why you start with a focus group. The group should include IT managers and key stakeholders from several areas of the business, and you want to use the group in order to paint the best possible picture of the organization’s strategic plan. When this plan is understood from every angle, IT initiatives can be built to support organizational initiatives, acting like pillars. Use a matrix to map goals and success factors for each of the business areas to whom you will be reporting.

Of course, all goals should be measurable, and Drucker says the best ones are “SMART”: specific, measurable, attainable, realistic, and timely. Develop KPIs at the same time you are building your support initiatives so that the business and IT agree on what is valuable. Dashboards and scorecards can then be used to visualize the tracking of those KPIs.

Here are the benefits of using the above program as Drucker sees them:

Direct: Live dashboards also provide the ability to determine the activities needed to drive success of an initiative and whether these activities are providing the expected result,
Validate: You and your stakeholders are able to use the metrics you provide to validate whether IT’s performance is contributing to the business’ ability to meet their goals and objectives,
Justify: IT is able to produce metrics that support a business case for infrastructure or development projects related to the delivery of a service,
Intervene: Live dashboards provide IT and the Business to know when there is a performance issue and they can intervene immediately to turn the problem around.

To learn about this framework in further depth, you can read the full article here:

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