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Best practices of Performance

Management in IT industry

AKHIL MAHAJAN

ABHAY DUGGAL

VIJAYENDRA BAWASHALU

CHANDNI CHADHA


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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.


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What is the performance management

issue for IT organizations?

Many senior managers believe that IT organizations are:

wasteful and inefficient (as evidenced by chronicproject cost overruns, late deliverables, etc.)

not aligned with strategic goals and businessobjectives.

Senior management is often handicapped in its decision-making 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 withinbudget


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Performance information that most ITorganizations lack relates to the non-technicalaspects 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 performanceproblems

there are troubled projects / activities thatrequire higher managements intervention, or

actions already taken to correct problems actuallyworked.


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Three of the concepts underlying

performance management

organizations "management system

performance measures

performance metrics


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How does non-technical IT

performance management work?

Preparatory steps forperformance managementinitiatives include:

Definition of the overallanalytic framework

Formulation ofimplementation plans

Assignment of analyticresponsibility, staff andmanagement training

conceptual design of thenecessary supportingsystems applications.


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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 thresholdsfor each important variable; exceeding athreshold indicates a problem worthy ofattention (e.g., achievement of a major projectmilestone is 30 days, or more, behind schedule)and possibly action.

Periodically (often monthly) monitorperformance variables for deviations fromestablished thresholds (a.k.a., variances). Whena performance threshold is exceeded (e.g.,vacant PC support staff positions increases to10% when the acceptable vacancy threshold is

3%), analysts identify a variance and determineits significance


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How does non-technical IT

performance management work?

Simulations

Trend analysis

In-depth performance reviews


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To help assure the success of a

performance management initiative:

understand managements information needs

have a clear picture of what you are trying to achieveand how you will do it

involve people who have actually established andmanaged performance management systems

study what other organizations are doing - learn whatworks and what doesnt

manage expectations - make sure all key participantsunderstand and agree on what will be accomplishedand when

use a limited pilot to gain experience (in other words,

confine your mistakes to a small area that you can fixquickly), and demonstrate early results


10/17

IT Performance Management - How

to get startedMeasuring performance isn't easy; too often,performance measurement initiatives falter because:

those charged with planning and implementing theinitiative had little or no prior experience withperformance management and measurement (often,

with the best of intentions, they repeat common,predictable, and sometimes fatal mistakes)

managements information needs were not identifiedin advance, and a well-thought-out conceptualframework and implementation plan was notdeveloped (in one case, after a years work, the first

performance report was submitted to seniormanagement two months late; the designers were told"this is not the information we need to see")

too much performance information materialized toosoon (the organizations capacity to assimilate,interpret, and react to it was overwhelmed)


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Five Things You Should Know Before

Undertaking An IT Performance

Management Initiative


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1. Performance management

improvements are often implemented

in concert with other managementimprovements


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2. Improvements take time and

sustained management commitment

3 Ad b d


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3. Adequate resources must be made

available

design and maintenance of the process

development of management and staffknowledge and skills

dedication (eventually) of staff to perform thenecessary analyses

acquisition, or development, of the technology tocapture and store large amounts of current andhistorical data

changing budgeting practices and procedures,along with budgeting systems capabilities


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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 businesslikeapproach to IT project and activity planning,

control, and reporting.


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5. Some of the approaches

recommended in current literature

can be risky. performance management and measurement

are sophisticated management tools that canyield significant benefits to the organization

some current publications reveals that quite afew are based more upon academic theory thansolid implementation experience.

The moral: Evaluate the source before youact upon the advice.


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