**From the August 2020 issue of AOTMP® Insights**
Key Performance Indicators (KPIs) present technology management teams the opportunity to use facts and business metrics to elevate technology into highly valued strategic asset status. KPIs need to be aligned to strategic business objectives, consistently measured, and tracked to identify trends and manage results. If not, the organization cannot take corrective action or identify the underlying business requirements for investment in technology.
KPIs are used to demonstrate the value technology brings to an organization. Selecting the right KPIs to measure and monitor, over time, is a critically important step. Equally important is understanding the cause and effect of any KPI movement, especially over time. In our experience, there are five KPIs organizations use to elevate technology to a recognized strategic business asset.
Technology Spend Per Employee
This KPI establishes a service‐to‐cost baseline for evaluating workforce technology enablement. Alignment of role profiles to spend should be established to provide technology‐to-role cost ratios. These metrics allow an organization to understand how costs are applied to individuals by their role, by their geographic region, or country. It also enables technology management teams to compare results across roles by function or geography.
Technology Spend Per Location
This KPI establishes a service‐to‐cost baseline for evaluating technology investment by location type. Organizational location profiles are created to reflect the primary organizational functions. Location type measured against spend enables a comparative analysis to provide the most efficient technology services by location to compliment the role profile service provision from the previous KPI discussed.
Technology Spend as a Percentage of Corporate Revenue
This KPI establishes a capability to evaluate technology cost as an element of the organization’s financial performance. Senior executives use this KPI to correlate the cost of technology investment to financial performance. If technology is elevated to a strategic business asset, then consistent alignment of cost to revenue must be established.
Ratio of Mobile Devices to Employees
This KPI provides a measure of the growth of mobility within the company’s workforce over time. It is essential knowledge to support mobility initiatives and new or emerging technology strategies. This metric is one of the most dynamic KPIs today; thus, it is critical to track as mobility investment continues to increase across most organizations. In many cases, this increase is uncontrolled, spread across multiple areas of an organization, and often does not take advantage of economies of scale or benefit from a smooth transition to new innovations.
Technology Spend Per Technology Management Employee
This KPI identifies and tracks service delivery efficiency and effectiveness. For example, in conjunction with other KPIs increasing in costs or usage, this KPI reducing can indicate a high degree of efficiency through training, expertise, systems, or processes. However, it must be considered with other measures such as user satisfaction, time to resolve problems for users, or other usability trends because it could also indicate a lack of needed investment. This KPI can be used for resourcing and planning purposes – whether the goal is headcount reduction or to obtain additional resources. This cost ratio also can be useful when considering a managed services or outsourcing option for technology environment management.
KPIs illustrating technology environment management results are essential to developing a strategic business dialogue in an organization. Identifying predictive or leading indicators of potential issues, understanding key organizational objectives, and using analytics to quantify the relationship between the technology environment and business objectives will turn defending the cost of technology into reporting on how technology assets contribute to the organization’s results. This ’transformation through information’ establishes technology as a valued, strategic investment integral to achieving the organization’s objectives.
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