A Four-Step Plan for Measuring Enterprise IT Agility
You can’t know if your enterprise IT is truly agile unless you measure it.
Corporate agility—the ability to quickly respond to changing market conditions and competitors—has become the new battle cry in today’s fast-paced business environment. Everywhere you look, companies are focused on becoming more agile. The companies that can out-quick their competitors are going to be the big winners in the future.
The pressure for companies to become more agile means enterprise IT has to become more agile too. Companies must quickly redirect IT resources and efforts to compete effectively in an increasingly competitive global marketplace.
Of the factors involved in making enterprise IT more agile, perhaps the most important is measuring and tracking enterprise IT agility. It’s a simple premise—measure what you want to improve. If you can’t measure enterprise IT agility, it will be difficult to determine if you are doing the right things to improve enterprise IT agility.
Research devoted to measuring corporate and enterprise IT agility has not found any easy answers. Building on my ongoing research of high-performance enterprise IT functions, I’ve developed a four-step approach for measuring and tracking enterprise IT agility.
Step 1: Determine What Must be Measured
The most obvious example of enterprise IT agility is how quickly new systems can be implemented, critical systems changed, or the IT infrastructure restructured to provide new strategic and tactical capabilities or to respond to changing market and competitive conditions. That means how long does it take to provide new IT-based capabilities from the time the enterprise recognizes the need for new capabilities.
For instance, enterprise IT might be able to complete a critical initiative in three months, but it might take six months to go through the request, review, prioritization, approval, and budgeting processes. It might take another three months to acquire software, order equipment, and arrange for specialized support or services. Completing the initiative in three months sounds pretty good—until you realize it took 12 months from need recognition to response.
This example isn’t far-fetched. It can take months—or even years—to get an enterprise IT initiative to the top of the project priority list and kicked off. That isn’t agile!
Looking at how long it takes to make required changes or enhancement from start to finish—even when some of the time lapse is outside the direct control of enterprise IT—gives the best picture of enterprise IT agility. As in our example, in most companies the actual “doing” time will be less than the time spent on all the “administrative” activities—which means the big improvements in agility are likely to come from streamlining enterprise IT administrative processes.
Step 2: Establish Agility Factors
After determining what should be measured, determine how to actually measure agility. You obviously want to track time or elapsed time, but there are three additional factors that should be measured:
Elapsed Time: The basic measure of agility is how long it takes to do something.
A measure of enterprise IT agility should track how long each step in the process takes—request, review, prioritization, approval, budgeting, acquisition (software, hardware, specialized support), development, testing, training, and implementation. Tracking the elapsed time for each step in the process will make it easier to identify opportunities for reducing time and improving agility.
Cost : Obviously, time should be tracked as part of a measure of enterprise IT agility, but why track cost?
The answer is simple. Committing extra resources or dollars to reduce elapsed time isn’t a good solution to the agility challenge. Paying a premium to reduce elapsed time might be practical under certain circumstances, but spending extra money to “buy” agility on a regular basis may not be a good investment.
You need not track costs for each step in the process because most of the cost is typically incurred in the acquisition and “doing” phases of the process.
Quality: Providing a poor-quality solution in a hurry doesn’t work. Don’t worry about the quality of each step in the process. The quality of the solution is determined by the customer or group requesting the new or enhanced capability and is based on feedback after implementation. Quality can be measured using a 0 to 100 scale or a point structure (5 for “Outstanding” to 1 for “Poor”).
My definition of enterprise IT agility is being able to provide critical capabilities in the least possible time, at the lowest possible cost, with the highest possible quality. Time, cost, and quality all must be considered in the enterprise IT agility equation.
Step 3: Establish Agility Baselines
Establish agility baselines as a starting point to track enterprise IT agility. Establish elapsed time, cost, and quality baselines for the system enhancement/upgrade process. Since very few companies have been tracking elapsed time, cost, and quality for the process, there are two approaches for establishing agility baselines.
One approach is to establish the baselines by going back and analyzing previous performance. For example, you can review how long it took to complete each step in the process for critical capabilities that have been provided in the past. This approach might not be 100 percent accurate, but it will give you a good starting place.
If you aren’t able to go back and analyze previous performance, the other approach is to establish baselines based on estimates of previous performance. Using estimates is less accurate, of course, but you are more interested in tracking enterprise IT agility improvements. The baselines just provide a starting place.
Step 4: Track Agility
Now the fun begins—actually measuring enterprise IT agility.
Don’t worry about small blips in agility—good or bad—on individual enterprise IT initiatives. You want to track overall agility to make sure you are doing everything you can to become more agile. As agility improves, tracking against the original baselines may not be meaningful. You may want to start tracking against actual agility results from a previous year or other time period.
Effectively measuring enterprise IT agility is new territory for most companies, but it has been used to ensure enterprise IT is becoming more agile. In the not-too-distant future, measuring enterprise IT agility will be as commonplace as tracking network availability or enterprise IT performance against budget.