Business-IT Alignment

Implement a Business Services Model (BSM)

IT organizations are driven and evaluated by metrics — percentage of uptime, etc. But business owners — non-IT personnel whose business units rely upon a certain application — often feel that IT is measuring the wrong things, and metrics often contradict the actual performance of the organization.

To illustrate this point, let's examine the case of a hypothetical claims processing application. The metrics indicate 99 percent uptime, but business owners are not happy. The cause of their angst is that fact that the application is often down during the early morning and late afternoon hours, the critical times when new claims are submitted and reconciled, respectively. To the business owner, 99 percent uptime is useless if it's not available when they need it. The problem arises from a lack of communication of specific business priorities and the poor translation into vague measures.

The solution may be to implement a Business Services Model (BSM). To accomplish this, both business and IT need to come together and negotiate internally to develop metrics that are linked to business priorities. Business must understand IT's capabilities and limitations, while IT must develop an understanding of the business needs.

Another important step is to discourage "cooking" the metrics, or structuring them so that they will appear more positive. One way to achieve this is to link the IT organization's reward and incentive systems to overall business performance, rather just IT service levels. While this will be an unpopular move, it is an important cultural change that can accelerate the process.

To ensure that metrics will properly measure alignment with business goals and user satisfaction, consider:

• Be objectively measurable. Include a clear statement of the end result expected.
• Support customer requirements, including compliance issues.
• Focus on the effectiveness or efficiency of the process being measured.
• Allow for meaningful trend or statistical analysis.
• Apply appropriate industry standards or other external standards.
• Specify assumptions and definitions for satisfactory performance.
• Involve those responsible for the performance being measured in the development of the metric.
• Be accepted by the provider and the customer.