This presentation looks at the different sources of data that will help to inform Senior Executives about the current quality of IT services overall and help make the right decisions about future IT investment priorities?
Measuring Quality of IT Services
Sources of data that will help to inform Senior Executives about
the current quality of IT services overall and help make the right
decisions about future IT investment priorities?
Sources of data to
measure IT Service Quality
Service Management Reporting
Business Risks and
Key Performance Indicators
Key Performance Indicators
Service Level Agreements
Key Performance Indicators
The definition of business strategy is a long term plan of action designed to achieve a particular goal or set of goals or
Strategy is the game plan for strengthening the performance of the enterprise, it states how business should be conducted to
achieve the desired goals. Without a strategy, management has no roadmap to guide them. Two main categories of strategies
can be identified:
Generic (general) strategies
1 Growth i.e. the expansion of the company to develop new products, and to purchase new assets, including new businesses. For example, the Inland Revenue has
expanded from being just a tax collector, to other functions such as collecting student loan repayments and paying tax credits.
2 Internationalisation/globalisation i.e. expanding business operations into multiple countries. For example, companies like Gillette, Coca-Cola, Kellogg's, and Cadbury
Schweppes are all major multinationals with operations across the globe.
3 Retrenchment i.e. cutting back to focus on your best lines and concentrating on what you do best. For example, Sony are focusing its business away from
Televisions and onto three areas - digital imaging, games consoles and mobile devices.
Competitive strategies, doing things better than rivals.
To be competitive a firm shouldn't just copy the ideas of rivals. They should seek to out compete rivals. There are two main ways of being competitive.
1 By selling goods at lower prices than rivals. This is possible when a firm is the market leader and benefits from economies of scale. For example, the selling point of
TK Maxx was designer fashion brands at a sizeable discount to high-street prices, and it soon attracted a cult following among bargain-hunting shoppers.
2 By differentiating your product from those of rivals - which enables you to charge a higher price if desired. For example, LUSH value social and corporate
responsibility over a luxurious and out-of-reach image. Understand their customer and are selling their viewpoint on how they define beauty.
Business Risks and Key Performance Indicators
The management of enterprise risk effectively and efficiently is critical to the success of business strategy. Business key
performance indicators assess business performance against strategy, examples include:
Profit: Analyse both gross and net profit margin to better understand how
successful the organisation is at generating a high return.
Cost: Measure cost effectiveness and find the best ways to reduce and manage
Revenue Vs. Target: This is a comparison between actual revenue and projected
revenue, helping identify organisational performance.
Cost Of Goods Sold: Understanding all production costs provides a better idea of
what the product mark-up should be and what the actual profit margin is.
Expenses Vs. Budget: Understanding where you deviated from your plan can help
you create a more effective departmental budget in the future.
Customer Lifetime Value: Helps you look at the value the organisation is getting from
a long-term customer relationship.
Customer Acquisition Cost: Can help evaluate how cost effective marketing
campaigns have been.
Customer Satisfaction & Retention: Make the customer happy and they will continue
to be your customer.
Net Promoter Score: Finding out your NPS is one of the best ways to indicate long-
term company growth.
Number Of Customers: By determining the number of customers gained and lost,
and whether or not meeting customers’ needs.
Employee Turnover Rate (ETR): If there is a high ETR, spend some time examining
workplace culture, employment packages, and work environment.
Percentage Of Response To Open Positions: A high percentage of qualified applicants
applying for open job positions, maximises exposure to the right job seekers.
Employee Satisfaction: Happy employees work harder. Measuring employee
satisfaction through surveys and other metrics is vital for organisational health.
Customer Support Tickets: Analysis of the number of new tickets, the number of
resolved tickets, and resolution time.
Percentage Of Product Defects: Take the number of defective units and divide it
by the total number of units produced in the time frame you’re examining.
Efficiency Measure: Analysing how many units have been produced every hour,
and what percentage of time the plant was up and running.
Technology Service Level Agreements
A Service Level Agreement is an agreement between two or more parties, where one is the customer and the other is a provider
of service, either internal or external. A well defined and typical SLA will contain the following components:
Type of service to be provided It specifies the type of service and any additional details of type of service to be provided. In case of an IP network
connectivity, type of service will describe functions such as operation and maintenance of networking equipment,
connection bandwidth to be provided, etc.
The service’s desired performance
A reliable service will be the one which suffers minimum disruptions in a specific amount of time and is available at
almost all times. A service with good responsiveness will perform the desired action promptly after the customer
The steps for reporting issues with the
This component will specify the contact details to report the problem to and the order in which details about the issue
have to be reported. The contract will also include a time range in which the problem will be reviewed and when the
issue is expected to be resolved
Response and issue resolution time-
Response time-frame is the time period by which the service provider will start the investigation into the issue. Issue
resolution time-frame is the time period by which the current service issue will be resolved and fixed.
Monitoring process and service level
This component describes how the performance levels are supervised and monitored. This process involves gathering of
different type of statistics, how frequently this statistics will be collected and how this statistics will be accessed by the
Repercussions for service provider not
If the provider is not able to meet the requirements as stated in the SLA then the service provider will have to face
consequences for the same.
Technology Key Performance Indicators
Technology Key Performance Indicators (KPIs) are used to assess if the systems and processes of an IT organisation are
running according to expectations. Usually these metrics are used to measure;
• Efficiency and effectiveness of a service;
• Service operation status.
The selection of suitable KPIs will, depend on the possibilities to actually measure the indicators.
Reports need to include commentary, analysis, critique and recommendations of the KPI data
ITIL Process Sample KPI ITIL Process Sample KPI
Service Level Management Services covered by SLAs Service Validation Incidents caused by New Releases
Capacity Management Incidents due to Capacity Shortages Configuration Management Number of unauthorised Changes
Availability Management Service Availability Incident Management Number of repeated Incidents
Business Processes with Continuity
Problem Management Number of unresolved Problem
Number of major Security Incidents Service Review Number of Service Reviews
Supplier Management Number of Contract Reviews Process Evaluation Number of Process Evaluations
Change Management Number of Emergency Changes Improvement Initiatives Number of CSI Initiatives
Transition Planning Number of Project Changes Financial Management Post Implementation Review
Release Management Number of Release Backouts Business Relationship
Customer Satisfaction per Service
Infrastructure Work metrics - A work metric measures how much useful information a system or application is producing. For instance, the
number of queries that a database is responding to or the number of pages that a web server is serving per second.
Resource metrics – A resource metric measures how much of something is consumed to produce work. Asking the question, “how
much CPU am I consuming in the database?”, doesn’t really say much about whether it is useful or not. It just says, “Well, I have more
CPU available, or not”
System Performance metrics - The performance experienced by end users of the application. One example of performance is average
response times under peak load. The components of the set include load and response times.
Availability metrics - The computational resources used by the application for the load, indicating whether there is adequate
capacity to support the load, as well as possible locations of a performance bottleneck. Measurement of these quantities establishes
an empirical performance baseline for the application.
User Experience End User metrics – The overall quality of all the interactions a consumer has with products and services. Passively monitor how
customers, employees and partners experience the delivery of services every time they interact with them. Allows the benchmarking
of what a good experience should be, and how far away the current experience is.
Monitoring tools enable identification and resolution of IT problems before they can adversely affect critical business processes.
• Provide insight into the status of the infrastructure, systems and user experience.
• Help ensure availability and performance.
• Help with planning for upgrades before outdated systems begin to cause failures.
• Respond to issues as soon as problems become evident.
• Ensure that any necessary outages have minimal impact on users.
Service Management Reporting
Data Description Measurement
Input data Incidents logged or Changes requested Incidents logged week-by-week; Incidents logged month-by-month; Incidents logged by
department; Incidents logged by priority.
Output data Incidents resolved, or Changes completed,. Incidents logged and resolved week-by-week; Incidents resolved by priority or company (within a
given reporting period)
Call Statistics Interactions with the Service Desk Average time taken to answer the telephone; Call abandonment rate; Calls answered by Agent;
Calls made, (all by time of day )
Status data A ‘snapshot’ of the dynamic data being
handled by the Service Desk at a point in time.
Number of Active Incidents, Problems and Changes; Status of Active Incidents; Number of Incidents
assigned to external suppliers; How active Incidents, Problems and Changes are assigned
Compares agreed response and resolution
with those actually achieved.
Percentages of responses on time against target; Percentages of resolutions on time (broken down
by priority) against target; Spread of resolution times broken down by priority or impact
Cause data Reports than link Incidents category to cause
to help identify trends
Causes of resolved Incidents; Cause broken down by resolver group;
Number of Major Incidents; Parts of the business affected, and the cause, remedy and future
actions arising from each Incident.
The downtime and availability for Critical
Downtime - the amount of hours that each system was unavailable.
Availability - hours each system was available as a percentage.
The objective of service measurement is to identify and collect information that identifies and quantifies service value-add, as well
as indicators of service risks, issues, and improvement opportunities enabling informed governance and planned action.
IT Customer’s Past
Ideal Level of IT Services for Customer Service Requirements
Acceptable Level of IT Services
Perceived Actual Level of IT Service for Operations and Support
Level of IT Service Actually Being Provided
IT Managers’ Perception of Customer Service Requirements
Translation of IT Service Perceptions into Service Quality
Requirements Given Personnel, Technology and Organisational
1: the difference between the perceptions of the Ideal level
of IT service
2: the difference between the perceptions of the Acceptable
level of IT service
3: the difference between the perceptions of the Actual level
of IT service
4: the difference between the IT service level that customers
would like to receive, and what they would accept
5: the difference between the IT service level acceptable to
customers, and the actual level of IT service perceived by
6: the difference between the IT suppliers’ perception of
what customers require, and the level of the IT service they
7: the difference between the IT service level the IT
suppliers can provide, and the actual level of the IT service
The relationship between IT and the business, and the perception of IT, improves when the business organisations feel that they
can count on IT to deliver what the business wants, when they have been told to expect it. IT processes need to remain
consistent and predictable, and that IT is able to clearly communicate how it meets its commitments to the business.
Technology Departmental KPI’s
It is important to ensure that the Technology Department KPIs are clearly aligned with the Business Strategy, Business KPIs and
the Business Risks, as it is an enabler of current and future capability for the organisation.
An imperfect selection of performance metrics can contribute to a poor perception of IT. Often the chosen operational
measurements don’t reflect how well IT is driving business value.
Only through a well-defined set of KPIs, can IT both qualitatively and quantitatively measure the delivery of value to the business
and achieve a high-performance result.
Standard formats should be agreed (e.g. dashboards, scorecards, reports, logs, etc.)
All agreed goals, critical success factors, and key performance indicators (KPI) for each service, at a level of granularity appropriate for the
target audience, should be reported on.
The data presented in the reports must be meaningful and must include commentary and analysis, with any recommendations, actions or
required decision clearly detailed.
Reports shall be transparent and available across management layers and departments.
Those authorised to act on report contents should be well enough informed by the report to make strategic, tactical, and/or operational
The reported metrics should be reviewed regularly and be relevant to business expectations and translated into business terms.