Running an IT department is like running a business. CIOs need key performance indicators and a process for measuring them. Here are five key metrics every CIO should possess.
Five CIO metrics
1. Business capability heat map
CIOs long for their IT organization to be viewed as a business partner. That is to say, a strategic counterpart capable of exchanging business ideas with various business unit leaders.
In order to achieve such status, IT must thoroughly understand the business itself. Understanding the business is a long journey, yet a step which expedites this process is mapping out key business capabilities. This can be done with a simple business model canvas or a more complex hierarchical tree map. In either scenario, key business capabilities such as building products, selling and marketing those products, and running the business itself must be outlined and scored in heatmap-like fashion. This go-to view of the enterprise is the anchor for many other informational views such as the application portfolio, the portfolio of projects, and so on.
2. The business application portfolio.
Modern enterprises own literally hundreds of applications; most of which are hosted in the cloud. CIOs need to understand:
- Which applications power specific segments of the business
- How much these applications cost, and whether these fees are economical
- Software insights such as application area gaps and overlaps
The sheer volume of software requires a scaled up / macro approach to managing the complexity. This means managing the enterprise software assets as a portfolio versus one-by-one. While this can be done manually, it typically requires automation through the use of software asset management discovery tooling feeding this strategic view.
3. The enterprise roadmap
The enterprise roadmap is a strategic, multi-year view of which key business systems are going to be replaced, enhanced, or simply maintained. While this view may be clear in the CIO’s mind, it’s like a very convoluted picture for CIO counterparts. The CMO may understand the martech landscape, but have no clue about the fintech app stacks. Likewise, HRIS may see the world through the lens of Workday and its adjunct ecosystem without understanding surrounding systems.
The takeaway here is – there has to be an overarching view of your perpetual digital transformation. Such a view helps orchestrate all these moving parts to prevent painful collisions.
4. The IT project portfolio
If the enterprise roadmap is a strategic multi-year view of transformation, the enterprise project portfolio is the tactical / single-year view of work being done. The portfolio itself will have numerous measurements such as:
- KTLO vs project work
- IT projects vs business projects
- Individual project health
- Resource allocations
CIOs need to see what percentage of IT is being allocated to the business versus IT itself. Many CIOs fall into the trap of bending over backwards for the business at the expense of neglecting the business of IT itself. This creates technical debt and ultimately weakens the IT department over time.
Managing projects by the numbers also makes it easier to demonstrate where IT is moving the needle, and where additional resources are needed.
5. Summary insights
Tying everything together is often where the real magic happens. Seeing the big picture of business capabilities, processes, applications, people, software, infrastructure and so on can be incredibly powerful. By aggregating these dimensions into one view, new insights such as risks and opportunities can be gleaned. Life without this view is akin to bumping around in the dark.
Achieving the Vision
Maturing an IT practice takes time, but like any other digital transformation, it requires a plan and expertise. See how Center Mast can assist you in this journey.