How to Justify Your IT Analytics Investment to Company Execs
Many companies tell us analytics would be nice to have, but they simply do not have the resources for another IT solution. New technology investments come with many obstacles in almost any IT organization due to several reasons. With your teams already facing increased complexity from balancing multiple service providers and a declining perception of IT, it is critical for any investment to demonstrate exceptional value.
Also noteworthy is that many organizations are shifting from a technology focus to a business focus. In our recent survey of IT professionals, almost half of the respondents indicated a desire to better gauge the health of their systems and tie it to business impacts. Team leaders seeking to justify IT investments must be able to prove how they will bring a strong return to an organization’s mission and goals. You can start by asking the right questions, such as how do you measure success and what IT processes and systems are (or are not) helping you achieve your IT goals?
Numerify recently attended the Knowledge17 Conference in Orlando, Florida, where thousands of service management leaders gathered to discover tools and systems that are transforming IT processes. We spent our days at Knowledge intently listening to and analyzing the needs and challenges of IT leaders. And we heard many similar remarks among enterprise IT teams from various industries. Here are some of IT’s most pressing challenges:
- 57 percent do not have a single view of IT performance across our people, processes, and projects
- 45 percent don’t have a complete picture of our key applications and business services health
- 38 percent can’t analyze IT data on the fly and have to rely on static reports
How Do These Prominent Challenges Impact Your Business?
As IT refocuses its initiatives to align with the business mindset, every investment must help relieve critical challenges and empower your organization’s overarching goals. Whether it’s improved service delivery, greater business continuity, or increased innovation speed, IT leaders are adamant that any technology investment you consider must align with your business priorities.
The challenges we heard at Knowledge have significant long-term costs. For example, some IT teams are leveraging insights in silos such as KPI reporting and system monitoring, but the data is incomplete and not actionable. Without a single source of IT performance, leaders resort to managing by intuition — as the 57 percent of IT professionals we surveyed can attest to. This form of management leads to incorrect and costly decisions such as:
In some cases, an incomplete picture of key applications results in major incidents that can turn into outages with extended downtime. Every minute of downtime is significantly costly — up to $540,000 per hour for enterprises — which amounts to average revenue losses of $26 billion annually. Additionally, revenue is directly impacted by poor management of project costs that turn into budget deficits. With lost revenue at stake, it is essential for IT to begin to proactively identify “hot spots” that predict possible production instability and answer what’s driving monthly project costs up/down.
Slow Innovation Speed
In 2013, 71 percent of corporations saw IT departments as the main driver of innovation. Just two years later that number has dropped to an astounding 34 percent. A comprehensive view of IT people, processes, and projects is critical for generating actionable insights that ensure higher uptime and increased revenue-generating applications. An analytics solution also frees up scarce IT resources to focus on driving innovation velocity higher.
Poor Resource Allocation
Service managers must be able to know when staffing issues are adding to service volume. We often see resources wasted on problems such as inadequate staffing, unbalanced workloads, and mismatched skillsets. Many service desk professionals we speak to admitted that they don’t track asset allocation and measure critical value metrics such as lost IT service hours, risk of missing service level agreement (SLA) targets, and costs saved through decreased fix times. These key metrics ensure that your resources are optimally allocated.
How Will IT Analytics Help Us Achieve Our Goals?
Analytics provide a 360-degree view of IT people, operational processes, vendors, and business impact. You will quickly be able to understand the broader effects of reassignments on your most critical tickets, correlate your changes with incidents, or evaluate whether the services of your vendors are the most cost-effective.
About 58 percent of IT professionals surveyed at Knowledge17 indicated that an important IT goal for the next 12 months is to increase business satisfaction/customer experience. Analytics dashboards like the one at left allow you to drill further into customer-impacting events (CIEs). Your team can track key metrics to understand and minimize the impact of incidents on customers, and focus efforts on performing root cause analysis for major incidents.
We also heard that controlling costs is a major initiative (~35 percent of K17 IT professionals). With analytics, teams can refine their IT cost allocation strategy and answer key questions such as, “What spend is driving project costs and trends up?” Our customers use visualizations to understand monthly project costs as well as cumulative costs and changes by service and configuration type. By reviewing detailed changes by month, project, service, and configuration items, IT leaders are able to make data-driven decisions to control spending and avoid budget overruns.
What Are Some of the Results?
The IT team at Cardinal Health, a leading healthcare provider, was able to reduce incidents by 60 percent and decrease their average problem age by 71 percent (from 120 days to 35 days). To do this, the team needed to increase visibility into service performance and customer-related events. With Numerify, IT leaders were able to quickly understand key metrics, compare CIE trends, and understand CIs and incidents in relation to events. Not only did Cardinal reduce incident volume and develop a faster resolution process for simple requests, the team was able to better allocate resources and no longer needed to backfill multiple Call Analyst positions.
Why IT Analytics Are Vital to Business Success
IT leaders in various industries have turned to analytics to meet demanding initiatives and excel at service delivery. IT organizations must advance to proactive processes that empower teams to build a reputable customer experience. IT is not just a gear that keeps the business turning but rather a core determinant of business success.
“Never feel like you are an order-taker/pure service provider. IT is the only function that has the visibility of the entire business lifecycle end to end.” — Zhanna Golodryga, senior vice president and CIO, Hess Corporation
Though new technology investments can be difficult to justify, IT leaders must ask if they can afford the alternative — unresolved challenges and consequences in terms of revenue, innovation speed, and resource allocation.
[Photo credit: Pexels.]
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