Best practices of Performance Management in IT industry
AKHIL MAHAJAN ABHAY DUGGAL VIJAYENDRA BAWA SHALU CHANDNI CHADHA
Issue :
IT organizations are being challenged to assure that their projects / activities (1) Are aligned with overall strategic goals and business objectives. (2) Deliver promised results on time and within budget.
What is the performance management issue for IT organizations?
Many senior managers believe that IT organizations are: wasteful and inefficient (as evidenced by chronic project cost overruns, late deliverables, etc.) not aligned with strategic goals and business objectives.
Senior management is often handicapped in its decisionmaking for IT because it has difficulty determining if the most important strategic and business needs are being met if they have been presented with the best IT options for decision-making the appropriate funding levels for IT projects / activities (how much to budget) whether the IT organization is likely to deliver the promised benefits and results on time and within budget
Performance information that most IT organizations lack relates to the non-technical aspects of the job; the information that can tell IT and senior management whether: IT projects / activities are progressing as planned there are telltale signs of future performance problems there are troubled projects / activities that require higher managements intervention, or actions already taken to correct problems actually worked.
Three of the concepts underlying performance management
organizations "management system
performance measures performance metrics
How does non-technical IT performance management work?
Preparatory steps for performance management initiatives include: Definition of the overall analytic framework Formulation of implementation plans Assignment of analytic responsibility, staff and management training conceptual design of the necessary supporting systems applications.
Once the foundation is established, performance management involves a number of recurring steps:
Gather performance data on those variables of interest to IT and senior management.
Analyze the data to determine normal (baseline) levels. Determine appropriate performance thresholds for each important variable; exceeding a threshold indicates a problem worthy of attention (e.g., achievement of a major project milestone is 30 days, or more, behind schedule) and possibly action.
Periodically (often monthly) monitor performance variables for deviations from established thresholds (a.k.a., variances). When a performance threshold is exceeded (e.g., vacant PC support staff positions increases to 10% when the acceptable vacancy threshold is 3%), analysts identify a variance and determine its significance
How does non-technical IT performance management work?
Simulations
Trend analysis
In-depth performance reviews
To help assure the success of a performance management initiative:
understand managements information needs have a clear picture of what you are trying to achieve and how you will do it involve people who have actually established and managed performance management systems study what other organizations are doing - learn what works and what doesnt
manage expectations - make sure all key participants understand and agree on what will be accomplished and when
use a limited pilot to gain experience (in other words, confine your mistakes to a small area that you can fix quickly), and demonstrate early results
IT Performance Management - How to get started
Measuring performance isn't easy; too often, performance measurement initiatives falter because: those charged with planning and implementing the initiative had little or no prior experience with performance management and measurement (often, with the best of intentions, they repeat common, predictable, and sometimes fatal mistakes) managements information needs were not identified in advance, and a well-thought-out conceptual framework and implementation plan was not developed (in one case, after a years work, the first performance report was submitted to senior management two months late; the designers were told "this is not the information we need to see") too much performance information materialized too soon (the organizations capacity to assimilate, interpret, and react to it was overwhelmed)
Five Things You Should Know Before Undertaking An IT Performance Management Initiative
1. Performance management improvements are often implemented in concert with other management improvements
2. Improvements take time and sustained management commitment
3. Adequate resources must be made available
design and maintenance of the process development of management and staff knowledge and skills dedication (eventually) of staff to perform the necessary analyses acquisition, or development, of the technology to capture and store large amounts of current and historical data changing budgeting practices and procedures, along with budgeting systems capabilities
4. The IT organization will need to learn new management techniques
Performance management can yield knowledge and information about the organisation. The ability to pinpoint potential, and actual, performance problems It will also require a more businesslike approach to IT project and activity planning, control, and reporting.
5. Some of the approaches recommended in current literature can be risky.
performance management and measurement are sophisticated management tools that can yield significant benefits to the organization some current publications reveals that quite a few are based more upon academic theory than solid implementation experience. The moral: Evaluate the source before you act upon the advice.
