I hate to say it, but IT gets a bad rap. Technology has hugely significant business value, but CIOs and IT leaders are still struggling to show the value IT delivers to the entire organization – and it’s a problem. While many CIOs have successfully managed to move from back office support functions and are now taking on strategic roles, others are still having trouble getting their CEO and the Board to escape the mindset that IT’s core mission is simply to “keep the lights on”. IT, indeed, is still viewed by many businesses as a cost center and not a value generator. The problem is that oftentimes IT fails itself with inadequate IT reporting – i.e. it fails to focus on the things that actually quantify the value that IT delivers to the organization.
A recent survey of 199 IT leaders by Korn Ferry reveals the gap. While the good news is that 52% said that their role is viewed as more strategic today compared to three years ago, the bad news is that 32% said that their CEO doesn’t fully understand their role, and 38% that the CEO and Board still see IT as more of a cost center than a revenue generator. In fact, only 7% agreed that their CEO and Board view the technology function as a revenue generator.
(Image source: engage.kornferry.com)
What, then, should IT leaders do differently to prove their worth to the CEO and Board? It may very well be true that in today’s digital landscape, every company is now a technology company to some degree. Every organization – from tech giants to fast-food chains – needs to have an IT strategy in place to ensure its continued existence. But, changing leadership mindsets is not an easy task, and when it comes to securing IT budgets for the future, overcoming this challenge requires IT leaders to prove the value of their department as a business enabler and revenue generator – not just a money pit.
Accomplishing this feat will involve building a strong and compelling business case – and effective IT reporting is paramount. Good IT reporting is about showing the value of IT investments within the greater context of business impact. So – what are the IT reporting must-haves? Let’s take a look…
- Outages Last Period
Outages impact a business’s ability to operate – i.e. make money. If your phones stop ringing, your website goes down, your CRM system goes on strike, your cybersecurity defenses fail, or any other enterprise application your business relies upon flatlines even for a minute, it’s the business that’s affected – and it’s IT’s job to put out the fire and get things back up and running.
Good IT reporting should detail the number and duration of outages over the last period to illustrate precisely what IT has had to deal with, and should be framed in a way that shows the potential loss of business if the issues were left unfixed (for example, how many customer enquiries may have been lost forever if IT didn’t resolve the customer contact issue as quickly as it did). IT reporting at this level makes it abundantly clear that IT is a value generator, not just a cost center.
- Percentage of Incidents Resolved Within 5 Minutes of Being Reported
How quickly does IT respond to incidents? As already illustrated, the longer it takes to fix an issue, the greater the potential of its business impact. The quicker IT is able to resolve incidents, the higher the department’s business value – and 5 minutes is a good benchmark.
IT reporting should include clear data that shows the percentage of incidents that were resolved within 5 minutes of being reported – again, highlighting the potential costs these incidents would have incurred for the business if they weren’t dealt with in such good time.
- Percentage of Transactions within Performance Service Level
The integrity of the business relies heavily on the integrity of IT transactions within the organization’s information system. If any one transaction fails to do its job correctly, the repercussions can ripple out far and wide. Large organizations today have dozens if not hundreds of applications running on a variety of platforms – from mail applications to order-entry systems, HR systems, CRM systems, ERP systems, and enterprise SaaS applications. These applications may be on physical servers, virtual machines (VMs), in private, public or hybrid clouds – and they must be supported on a range of devices including desktops, laptops, smartphones and tablets.
Businesses rely on the success of all IT transactions working harmoniously across all applications, platforms and devices – and so transaction performance must be monitored. Naturally, the transaction management tools used to track performance send out error messages and warnings every single day, and IT must respond to keep the business running and operational (i.e. profitable). Good IT reporting will highlight the percentage of transactions that the department keeps within acceptable performance parameters, demonstrating that IT is indeed the very lifeblood of the business and its ongoing operational success.
- Number of Problems Permanently Resolved Last Period
The goal of problem management is ultimately to minimize the number and severity of incidents and potential problems that could impact the organization. But problems, of course, don’t necessarily occur in isolation – the same incident could be occurring many times, and it could be impacting many different users and the availability of IT services. These types of issues are by no means infrequent – and it’s down to IT resolve as many as possible permanently. Permanent resolutions to problems naturally reduce incident volume, increasing productivity right across the board – from those who are directly affected, to the IT department itself.
Problem management is indeed a high-value IT operation, and it should be demonstrated as such in IT reporting.
- Problem Management Backlog Aging Summary
Problem management should aim to reduce the adverse impact of all known problems caused by errors in IT infrastructure, and prevent the recurrence of incidents related to these errors. Naturally, however, such problems are addressed in priority order, with the highest priority given to the resolution of problems that cause the most severe disruption to critical IT services. But what this means is that there will be a backlog of lower priority problems that aren’t getting fixed, which is a marker of technical debt that must be addressed. Effective IT reporting should include a problem management backlog aging summary – including details of the backlog’s business impact – with a clear plan to work through and eradicate the backlog within a given timeframe.
- Number of Successful Changes
Change is the addition, modification or removal of anything that has an effect on IT services. But change has consequences. For starters, change comes at a cost, and a successful change is one where the benefits outweigh the costs. As such, all change management initiatives must be monitored, and for good IT reporting, it’s important to report on the business value that each change is delivering. By tracking the number of successful changes, IT leaders can demonstrate the value each change is bringing to both service management and the organization at large.
- Change Management Summary
Following on from the previous point, a change management summary must also be produced to illustrate which services are actively being changed – including both planned and unplanned changes. The report should include a proper impact analysis and detailed rollout plan for all changes that are being implemented, the number of changes in the backlog, as well as resources used and funds spent on changes. The goal here is to achieve a higher percentage of successful change implementations – good IT reporting should demonstrate this.
- Service Level Achievements for Incidents and Requests
IT reporting should also be thorough on achievements of service levels. Regular status reports on IT help desk performance should be produced to illustrate achievements with regard to the number of incidents and requests that are handled.
Importantly, to demonstrate value, evidence must be provided that service level achievements are continuously improving, and that IT costs are decreasing for services with stable service level achievements.
- Service Availability
Service availability IT reporting is also essential for demonstrating the value of IT in terms of business objectives and continuity. Reporting on service availability shows that IT is managing systems and applications effectively, and that it’s proactively scheduling checks and updates to ensure that the number of costly incidents and downtime occurrences is kept to a minimum.
- Knowledge Usage
Knowledge and information management between IT and the wider organization is crucial for successful service delivery. By being able to view, search and share knowledge easily, IT can streamline processes, including incident, change, and problem management. All departments rely on the IT knowledge base frequently to address the issues they encounter. IT reporting should highlight how often this knowledge is accessed, and how many tickets are resolved through successful knowledge transfer.
- Cost of Service Operation or Support Cost Per Contact
Cost per Contact (CPC) measures the level of financial efficiency that the IT service desk delivers as it provides support to the organization. This is a crucial key performance indicator (KPI), and, as such, should be included in all IT reporting. Importantly, your report should not only reveal current CPC metrics, but demonstrate what you are doing to drive them down – for example, improving first call resolution and average speed to answer metrics.
- Service Utilization
Who’s using IT services and how much are they consuming? This is particularly critical for digitally transformed business processes. As businesses go through digital transformation – as they must in order to remain competitive – employees throughout the organization must adapt to new technology and processes. IT, once again, is the glue that holds the whole organization together through digital transformation, and this value must be demonstrated through IT reporting. Could marketing function without IT? Could sales close deals? Could customer service provide round-the-clock support? Your service utilization report will demonstrate where IT’s value is most keenly felt and realized.
- Service Costs
IT is not a cost center – it is a value generator. But it’s still not free. It’s important, therefore, to report on the total cost of ownership (TCO) for providing each service. Managing the cost of services is essential to running a financially-efficient IT service. Reporting is crucial in this regard, for only by identifying the expenditure on various IT services will organizations be able to reduce IT spend, as it then becomes possible to establish why certain services are being requested, predict future request levels, and thereby budget more accurately. As such, by focusing on service costs in IT reporting, IT leaders effectively demonstrate their strategic value to the larger business.
- End-to-End SLA Assessments
Reporting on IT SLAs (Service Level Agreements) is critical for IT department success. However, today’s IT environments and infrastructure – which includes multiple platforms and applications, disparate services, cloud, virtualization, and more – create many co-dependent complexities in delivering any one service effectively. The fact of the matter is that a service or business process is only as good as its weakest component – so IT reporting on end-to-end SLA assessments is vital. The report should define services by grouping infrastructure and applications logically, and should demonstrate that if an SLA is trending to miss target, there is time (and an action plan in place) to fix it.
IT Reporting Tools
IT reporting is indeed critical to prove the value of IT to the CEO and Board, and the reports listed above will enable you to do that. But in order to create them you need access to the relevant data. You need the right tools to gather IT service information, and then visualize and customize your reports.
One such tool is provided by Ivanti – named Ivanti Xtraction. Xtraction is a powerful IT reporting, dashboard, and analytics tool that makes critical IT-related data accessible and visible, with all information updated constantly for real-time accuracy. Ivanti Xtraction allows IT departments to build fully-customizable dashboards, enabling IT teams to collect, view, and analyze the key data they need to make informed business decisions. With comprehensive insights, IT can view current IT status, track performance, and assess risks in order to take action now and plan future resources. What’s more, with C-Suite Views, high-level, business-aligned reports can be created simply and easily – with red, amber, and green IT metrics, as well as financial impact metrics – to present to the CEO and Board clearly and concisely.
(Video source: youtube.com)
For many organizations, the value of IT is only measured by its ability to “keep the lights on and engines running”. In order to change and expand current perceptions and truly show just how much value IT brings to the organization, effective IT reporting is critical. IT mustn’t sell itself short, and instead focus on the things that actually quantify the value of the services delivered. Tracking the right metrics is paramount – as is using the right tools to visualize and make sense of the data in a manner that the CEO and Board can’t afford to ignore. CIOs and IT leaders need to improve their data mining and interpretation skills, and produce the reports that prove in no uncertain terms that IT is not a cost center, but an essential value generator, business enabler, and profit driver.