“The new normal has become the now normal.” The historical review of yearlong metrics and benchmarks is dying. The new metrics are about “What do we need to do about that blinking red light right now.” (Michel Janssen, CRO, the Hackett Group) “The idea of the new is really important. Things are happening so fast that relying on year old numbers is not doing it.
The more you can get these things in real time, even if not a perfect real time, the better you are, and “whether or not you have the perfect bench mark if you have a metric that works, you can trend that over time and looking at the trends can be very valuable. If it is a metric that works for you and you are measuring yourself against yourself that is a believable trend.” (George Westerman, Research Scientist at the CISR, MIT, SLOAN School)
CIO’s are always looking for the right levers and dials to put in place to impress, justify, or manage, however a new concept is emerging. According to Dr. Westerman (CISR MIT, Sloan), the “idea of exploiting metrics is huge.” Metrics can be “exploited,” and used to drive behavioral chances. “Metrics are a tremendous way to change behaviors and to change decision processes if you have the right metrics.” (George Westerman)
IT leaders need to focus on why they are using the metrics and then “You can use metrics to reshape the conversation you are having with people to convince people that you have no authority over, to change.” “The really essential thing here is that you have to know what behaviors you want to drive and then you have to choose metrics and make them really relevant to the people you are talking to.” And “When (executives) stop being interested in a measure, that is the time to move to the next kind of behavior to change.” (George Westerman)
How does an IT leader use metrics to change business leaders’ behavior?
To “exploit” metrics and change behavior, Dr. Westerman (CISR at MIT, Sloan) lays out a strategic map called, “The Path to Value.” It starts with demonstrating “value for money” (IT is doing what it’s supposed to be doing, and doing it well). The next level is to talk about “project benefit realization” and help business use IT well, thus demonstrating that IT works with them to get the value from their investment and allow them to take responsibility.
At that point partnership happens and there is a new focus on innovation. So first you have Value for money, project benefits realization, and then innovation. Strategic contribution emerges beyond that. Once value is demonstrated, it establishes “some discipline around what is often a very ugly project prioritization process and makes it very clear who is delivering the value.” Allowing IT leadership the opportunity to change the conversation and drive change. “You can use metrics to reshape the conversation you are having with people to convince people that you have no authority over, to change.” (George Westerman)
As real time metrics and benchmarks are becoming available, perhaps some caveats should be pointed out. Though the overwhelming availability of data and metrics in real time on a plethora of gadgets riding on the clouds has given organizations a new ability to respond to competitive and economic events NOW, it needs to be recognized that immediacy also has its risks.
Time for deep deliberation is short. All we can do is optimistically assume that the collaboration of multiple participants up and down and across the organization will ensure that ‘haste no longer makes waste.’ As for the use of metrics to change behavior, that is likely a slow process. Given that IT leaders’ tenures are often short, the window for such changes can close quickly, but it is certainly an important new tool for IT leaders.