IT Performance Measurement using IT Governance Metric
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Using IT Governance as a tool for measuring IT performance. COBIT 5 has provided generic metrics at strategic levels [Enterprise metrics], Tactical level [IT Goals metrics] and Operation Level [Process metrics]. We will highlight the benefits and objectives of the measurements, and then provide an approach along with suggestions on the time/frequency of measurement. This webinar covers the following: • An Overview of IT Governance • Why and What to measure – Benefits and Objectives • How and When to measure – Approach and Schedule Presenter: Oladapo Ogundeji's professional career extends over 18 years of experience focused on enhancing the strategic value of ICT in organizations through process re-engineering, strategic planning and project management for corporate objective & strategy that address business opportunities and issues. Link of the recorded session published on YouTube: https://youtu.be/TOG3RPp1g0c
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IT Performance Measurement using IT Governance Metric
- 1. 1
- 2. Oladapo Ogundeji CTO/CISO - Digital Jewels Limited Professional career extends over 18 years of experience focused on enhancing the strategic value of ICT in organisations through process re-engineering, strategic planning and project management for corporate objective & strategy that address business opportunities and issues. A highly trained ICT Management Specialist & Consultant. Masters In Information Technology ( M.I.T ). B. Sc. Electronics & Electrical Engineering. Contact Information +234099930209 dapoo@digitaljewels.net www.digitaljewels.net https://ng.linkedin.com/in/dapoo
- 3. QUALIFICATIONS... COBIT 4.1/5.0 Foundation & Certified Trainer; Implementer and Assessor. Business Continuity Management : ISO22301/ BS25999 Certified MASTER & Accredited Trainer ISO 27001 Certified Lead Implementer Certified & Trainer Certified IT Business Manager (ITBMC) PRINCE2 Foundation Certificate (Project Management Methodology). ISACA : C I S A // C I S M // C G E I T IT Service Management Foundation (I T I L) RAD Datacommunication Specialist & Engineer. HP (COMPAQ) : Accredited Compaq Technician (A C T) // Accredited Platform Specialist (A P S) Microsoft Certified Professional: ( M C P) // Microsoft Certified Professional + Internet: ( M C P + I) // Microsoft Certified Professional + Internet: ( M C P + I) // Microsoft Certified System Engineer : ( M C S E) // Microsoft Sales Specialist : ( M S S) Cisco Certified Network Associate ( C C N A ) // Cisco Certified Network Professional ( C C N P ) // Cisco Certified Design Associate ( C C D A ) // Cisco Certified Design Professional ( C C D P ) // Cisco Sales Expert (CSE ) BICC Brand-Rex (Structured Cabling) Certified Installer. TOGAF 9.1 Certified [+ Foundation] MoR (Management of Risk) Certified & Accredited Trainer
- 4. An Overview of IT Governance •Why we measure – The Benefits •What to measure – The Objectives •How to measure- The Approach or methodology •When to measure – The Schedule or Timing OUTLINE
- 6. What is IT Governance www.digitaljewels.net6
- 7. What is IT Governance www.digitaljewels.net7
- 9. 5 Focus Areas of IT Governance www.digitaljewels.net9
- 10. Purpose of IT GOVERNANCE www.digitaljewels.net10
- 11. Measuring the Performance of IT www.digitaljewels.net11 Performance measurement frameworks need to be balanced, multidimensional, comprehensive and integrated into the organizational performance measurement framework. The selection process of a performance measure is crucial. It requires explicit communication about performance priorities and the relationships between the priorities to reveal hidden differences in the state of mind of stakeholders Measures also need to be agile and developed while being clear who is responsible for the measure and what actions are taken on the results of the measure.
- 12. The Need for Effective Metrics www.digitaljewels.net12
- 13. Performance Measurement Framework • COBIT is one of many IT governance frameworks that is widely used to control if information available in the organization is being used to achieve business objectives. • The COBIT 5 enterprise and IT-related goals are used as the basis for setting IT objectives and for establishing a performance measurement framework. • IT objectives are expressed as goals and need to be aligned with enterprise goals. www.digitaljewels.net13
- 14. WHY WE MEASURE – THE BENEFITS 14
- 15. Benefits of Measuring IT Performance • Performance measurement is a key component of IT governance - You cannot effectively manage what you cannot measure ! www.digitaljewels.net15
- 16. Benefits Contd…. www.digitaljewels.net16 It is required to ensure that the outcomes of IT activities are aligned to the enterprise and customer’s goals It verifies the achievement of strategic IT objectives and provides for a review of IT performance and the contribution of IT to the business Provides inputs for resource allocation and planning It is a vital tool when assessing mergers and acquisitions to allow earlier insight into IT strengths and gaps
- 17. WHAT TO MEASURE – THE OBJECTIVES 17
- 20. COBIT 5 Recommended Areas to Measure www.digitaljewels.net20
- 21. HOW TO MEASURE- THE APPROACH OR METHODOLOGY 21
- 22. Measurement Methodology • COBIT 5 uses the balance scorecard approach to IT performance measurement. • COBIT 5 balance scorecard approach translate organisation strategy into specific measurable objectives. • The approach attempts to create a measurement balance across the overall performance management framework. • A balance approach to measuring the contribution of IT to mission outcomes and performance improvements recognises the broad impacts of IT’s supporting roles. www.digitaljewels.net22
- 23. COBIT 5 Balance Scorecard www.digitaljewels.net23
- 24. COBIT 5 scorecard evaluates performance in four areas www.digitaljewels.net24
- 26. IT-Related Goal Sample Metric www.digitaljewels.net26
- 27. WHEN TO MEASURE – THE SCHEDULE OR TIMING 27
- 28. Measurement Timing www.digitaljewels.net28 IT performance should be measured on a regular basics and whenever resources are critical to strategic IT decisions There are different factors that may indicate a need for improved governance and management of enterprise IT
- 29. IT Performance – Measurement Phases Establish the performance goals. Perform an assessment of the processes and metrics to determine a current state. Adapt COBIT metrics as key performance indicators (KPIs). Agree the criteria for acceptable performance. Align the metrics to the current state of the business. Report performance status on an agreed schedule to the concerned stakeholders www.digitaljewels.net29
- 30. CONSTRAINTS 30 • Senior management not engaging IT – Unwillingness to involve IT in decision making • Poor Risk Management – Not assessing likely potential threats • Poor Strategic Alignment – Little or no business value derived from major IT investments • Ineffective Resource & Resource Mgt – Ensure timely availability of people, technology and financial resources.
Editor's Notes
- IT governance consists of the leadership, structures, and processes that enable an organisation to make decisions to ensure that its IT sustains and extends it strategies and objectives. IT governance is an integral part of enterprise governance and as with enterprise governance, requires a clear understanding of the enterprise strategic goals and objectives and a structure with repeatable process to support decisions ensuring alignment of IT investments with those goals and objectives.
- Strategic Alignment Link business and IT plan (value preposition) Align IT operations with Business operations Value Delivery Ensure IT delivers to promised benefits/value Optimise cost and value of IT Resource Management Optimal investment Manage IT resources (Application, Infrastructure, information and people) Risk Management Risk awareness and appetite by senior corporate officers Understanding of compliance requirements Assign risk management responsibilities into the organisation Performance Measurement Track/monitor strategy implementation – BSC (resources, process, projects and services
- The purpose of IT governance is to direct IT endeavours, to ensure that IT’s performance meets the following objectives: Alignment of IT with the enterprise and realisation of the promised benefits Use of IT to enable the enterprise by exploiting opportunities and maximising benefits Responsible use of IT resources Appropriate management of IT-related risks
- COBIT 5 provides structures for defining goals at three levels: for the enterprise, IT overall and IT processes. These goals are supported by metrics known as outcome measures because they measure the outcome of a desired goal. The metrics at a specific level also act as performance drivers for achieving higher-level goals. These goals and metrics can be used to set objectives and monitor performance by establishing scorecards and performance reports as well as for driving improvements. Successful enterprises use the benefits of IT to achieve value from IT investments when they measure and align the IT strategy to the corporate strategy. Cobit identifies which resources need to be leveraged and defines the management control objectives that have to be considered.
- The following are the benefits why we measure the performance of IT using COBIT 5 framework: 1. It verifies the achievement of strategic IT objectives and provides for a review of IT performance and the contribution of IT to the business (i.e. delivery of promised business value). 2. Performance measurement supports the other key elements of IT Governance by: Alignment – monitoring the strategic direction of IT and the alignment of IT and the business. Value Delivery – assessing whether the IT/Business organisation is providing business value from IT and assessing ROI, Risk Management – monitoring whether risks are being identified and managed and measuring the cost and benefit of risk management investments, Resource Management – measuring the effectiveness of sourcing and use of IT resources, the aggregate funding of IT at enterprise level, and measuring IT capability and infrastructure compared to current and expected future business requirements. 3. Performance measures are required to ensure that the outcomes of IT activities are aligned to the customer’s goals. Internal IT process measures are required to ensure that the processes are capable of delivering the intended outcomes cost-effectively. Advanced performance measurement enables the measurement of key aspects of IT capability such as creativity and agility (new ideas, speed of delivery and success of a change programme), development of new solutions, ability to operate reliable and secure services in an increasingly demanding IT technical environment, and the development of human resources and skills. 4, Provides inputs for resource allocation and planning. It will help organisation prepare for future conditions that will likely affects the impact of program and support function operations, such as decreasing personnel or financial resources or changes in workload. Use of measures can give organisations lead times for needed resource adjustments if these conditions are known in advance. 5. Performance measurement may also be a vital tool when assessing mergers and acquisitions to allow earlier insight into IT strengths and gaps. The introduction of a performance measurement system focused on a few key measures can be an excellent way to kick-start an IT Governance initiative, providing, perhaps for the first time, transparency of critical activities and a way to bridge the communication gap between IT and its customers.
- Getting your performance measurement right involves identifying the areas of your business it makes most sense to focus on and then deciding how best to measure your performance in those areas. Your performance measurement will be a more powerful management tool if you focus on those areas that determine your overall business success. This will vary from sector to sector and from business to business. So put some time into developing a strategic awareness of what it is that drives success for businesses like yours. It's crucial that you tailor your measurement to your specific circumstances and objectives
- To support IT Governance, Cobit 5 goals cascade is the mechanism to translate stakeholders needs into specific, actionable and customised enterprise goals, IT-related goals and enabler goals.
- COBIT 5 defines seventeen (17) IT-related goals and these are recommended areas to measure.
- COBIT 5 scorecard evaluates performance in four areas: 1. Financial – how does the organisation look to customers? 2. Customer – how do customers see performance? 3. Internal – at what must the organisation excel? 4. Learning and Growth – can the organisation continue to improve and create value? By measuring IT performance across four goal areas that are critical to the overall IT’s success, the scorecard forces management to consider measurement within the context of the whole organisation