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Balancing Your Metrics with ITIL®

Date:
March 26, 2019
Author:
Barry Corless

What to measure can be a tricky conundrum to solve for any product or service, due to conflicting advice sometimes given by best practice frameworks. For example, DevOps tells us to measure everything and make those measurements available to everybody. OK, this makes metrics available but to avoid being swamped you really need to know what question your metrics are required to answer.

The Global Knowledge view is that we learn about all our options before choosing the path that works for our organization. Here we look at three of the common metrics questions and how ITIL® offers a balanced view for solving them.

 

How can my metrics predict the future?

Too often metrics just tell us about the past without giving much insight into the future. This can be overcome by using a balance of leading and trailing metrics. Trailing metrics are typically output-oriented, easy to measure but harder to improve or influence. Leading indicators are typically input-oriented, harder to measure but easier to influence. For example, our trailing metric might be the “number of incidents or service requests related to a new product or service” — easy to measure but difficult to influence if you don’t know the cause(s). Leading metrics that could indicate we have an issue in waiting might be “uptake and understanding by users of product/service training” — poor understanding could lead to lots of “how to” questions for your service desk. This is certainly more challenging to measure but easier to influence.

 

How do I link the service provider view to a business view?

Linking critical success factors (CSFs) and key performance indicators (KPIs) is one way to join the two key perspectives. CSFs effectively ask, “What must we do to be successful?” Related KPIs answer the question, “What indicates that we are succeeding?”

The use of KPIs can be literal or loose. For example, using them literally means that you set a baseline (e.g. closure of 90% of priority 1 incidents within SLA targets). Using them loosely means that you monitor data trends to determine whether performance is improving (e.g. we will be watching the customer experience scores over this month as they are a clear indicator of our performance).

Both ways of using KPIs have their uses; the more certain you are of the relationship between your CSFs and business goals, the more literal you can define KPIs. Each CSF should have three KPIs. Below is a typical example for incident management.

CSF: Prioritization of incidents in line with business goals

  • KPI1 - Number of incident priority changes (how often was a priority raised or lowered by category)
  • KPI2 - Customer satisfaction index (lower satisfaction might indicate poor prioritization)
  • KPI3 - Number of escalations requested (how often users or customers request escalation by category)

 

I have multiple stakeholders. How do I satisfy them all?

One issue we see on many occasions at Global Knowledge is when metrics fail to satisfy all the relevant stakeholders, such as sponsors, customers, users, service providers, regulators, etc. There are two remedies to this problem.

First, the use of metrics balanced between progress, compliance, effectiveness and efficiency. This is an effective set to use in a product or project environment.

Progress measures milestones and deliverables in the developing capability of a product or service. A progress metric is typically expressed in terms of actions completed or percentage project completion. For example, the new service has undergone operational acceptance testing or measurement of tasks against a burn down chart.

Compliance measures the product or service to governance and regulatory requirements. A compliance metric is often expressed in terms of a Boolean pass/fail or yes/no result. For example, “Compliance to GDPR regulations.”

Effectiveness measures the accuracy and correctness of the product or service and its ability to deliver the right result. For example, “Number of correctly assessed mortgage applications.”

Efficiency measures the productivity of the product or service, its speed, throughput and resource utilization. For example, “Average cost per incident resolution.”

Secondly, we can use the Kaplan and Norton balanced scorecard. It is called “balanced” because it considers the balance between four perspectives, all of which contribute to achieving the vision and mission of the organization.

Customer perspective recognizes the importance of customer experience, perhaps through a Net Promoter Score (NPS) or Customer Effort Score (CES). This could be widened to a view of customer value of the product or service.

Financial perspective focuses on traditional management of cost.

Business process perspective looks at the well-being of the organization’s processes and value streams. This can be a good leading indicator of future performance. Learning and growth focuses on continual improvement. It is holistic in its view, including training and development of people and management of knowledge.

What we have presented here are top quality ingredients. Your job is to mix them into something that satisfies your organization’s palette. More information is available through the current ITIL Practitioner course or the upcoming ITIL 4 Direct, Plan and Improve offering.

 

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