Foreword | p. xiii |
Preface | p. xv |
Acknowledgments | p. xvii |
Introduction | p. xix |
About the Authors | p. xxiii |
List of Commonly Used Acronyms | p. xxv |
What Does IT Contribute to the Business? | |
What Should the Business Expect from IT? | p. 3 |
Information for Decisions | p. 5 |
Value for Money | p. 6 |
Risk Management | p. 7 |
Innovation | p. 8 |
Process | p. 9 |
Responsiveness | p. 11 |
Summary | p. 12 |
References | p. 12 |
How Do I Measure the Value of IT? | p. 13 |
What Is Value? | p. 13 |
Why Is It Important to Measure IT Value? | p. 15 |
Financial Value Measures | p. 16 |
Total Cost of Ownership (TCO) | p. 16 |
Return on Investment (ROI) | p. 16 |
Economic Value Added (EVA) | p. 17 |
Real Options Valuation (ROV) | p. 17 |
Return on Assets (ROA) | p. 18 |
Return on Infrastructure Employed (ROIE) | p. 18 |
Non-Financial Value Measures | p. 19 |
Multi-Dimensional Value | p. 19 |
Strategic Value | p. 21 |
Using IT Value Measurements for Decisions | p. 25 |
Dashboards | p. 26 |
The Business Case | p. 27 |
Value Visualization | p. 29 |
Summary | p. 31 |
References | p. 31 |
How Much IT Is Enough? | p. 33 |
ROI or Return on Investment for IT Spending | p. 34 |
IT Spending as a Percentage of Gross Company Revenue | p. 36 |
IT Distribution Analysis | p. 36 |
Organizational Evaluation | p. 39 |
Containing Cost Versus Innovation | p. 40 |
Summary | p. 42 |
References | p. 42 |
Am I Paying Too Much for IT? | p. 43 |
What Is a Budget? | p. 44 |
Defining a Budget for IT | p. 44 |
IT as a Percent of Revenue | p. 46 |
IT as a Percent of Total Operating Expenses (Opex) | p. 46 |
IT as a Strategic Business Partner | p. 47 |
IT Poised to Enable the Business Strategy | p. 51 |
Capitalizing IT Expenses | p. 52 |
Monthly Budget Review | p. 54 |
Monthly Project Review | p. 55 |
Summary | p. 56 |
References | p. 56 |
Why Should We Care About it Governance? | |
Who Governs IT? | p. 59 |
What Is IT Governance? | p. 59 |
Key Elements of IT Governance | p. 60 |
IT Principles Decisions | p. 60 |
IT Architecture Decisions | p. 61 |
IT Infrastructure Decisions | p. 62 |
Business Needs Decisions | p. 63 |
IT Investment and Prioritization Decisions | p. 63 |
Decision Input and Decision Making Models | p. 64 |
Summary | p. 69 |
Reference | p. 70 |
What Models Should IT Use? | p. 71 |
Capability Maturity Model Integration (CMMI) | p. 72 |
Control Objectives for Information and Related Technology (COBIT) | p. 77 |
IT Infrastructure Library (ITIL) | p. 79 |
Service Strategy Processes | p. 84 |
Service Design Processes | p. 86 |
Service Transition Processes | p. 87 |
Service Operation Processes | p. 89 |
Continual Service Improvement Processes | p. 89 |
International Organization for Standardization (ISO) | p. 90 |
Project Management | p. 92 |
Six Sigma | p. 93 |
Summary | p. 98 |
References | p. 98 |
Are We Outsourcing Effectively? | p. 99 |
Why Should We Outsource or Why Are We Outsourcing? | p. 100 |
What Are Our Competitors Outsourcing Today? | p. 101 |
What Should We Be Outsourcing? | p. 105 |
Is Our Governance of Outsourcing Appropriate? | p. 107 |
Are We Engaging With Our Outsourcing Vendors Appropriately? | p. 111 |
Are Our Service Level Agreements (SLAs) Driving the Behavior We Need? | p. 115 |
The SLA Framework | p. 117 |
Identifying Service Level Measures | p. 117 |
Measuring Levels of Service | p. 118 |
Monitoring Performance | p. 119 |
Summary | p. 120 |
References | p. 120 |
What Tools Should IT Use? | p. 121 |
What Are the Business Benefits of Using IT Tools? | p. 122 |
What Are the Business Risks of Using IT Tools? | p. 124 |
How Will IT React to Business Questions About Tools? | p. 125 |
An IT Software Tools Taxonomy | p. 127 |
Service Management Tools | p. 127 |
Service Support Tools | p. 128 |
Service Delivery Tools | p. 132 |
What Criteria Should We Use for Evaluating Software Tools? | p. 133 |
What Are the Best Options for Delivering IT Tools to End Users? | p. 134 |
Summary | p. 135 |
References | p. 135 |
Why Should We Measure It Performance? | |
How Do I Measure IT Performance? | p. 139 |
IT Value Contribution | p. 140 |
Four Key Performance Measures (+ One) | p. 142 |
Cost | p. 143 |
Quality | p. 143 |
Duration | p. 143 |
Customer Satisfaction | p. 144 |
The Missing Measure: Size | p. 144 |
Function Point Analysis | p. 146 |
Combing the Key Performance Measures | p. 147 |
Cost and Size | p. 147 |
Duration and Size | p. 148 |
Quality and Size | p. 148 |
Effort and Size Productivity | p. 149 |
A Successful Measurement Program | p. 150 |
Determining the Source of the Data | p. 150 |
Ensuring the Integrity of the Data | p. 151 |
Reporting the Data | p. 151 |
Summary | p. 152 |
References | p. 153 |
Is IT Operating Effectively? | p. 155 |
Introducing the Measurement Model | p. 155 |
Quantitative Data | p. 156 |
Qualitative Data | p. 158 |
Collecting the Data | p. 160 |
Quantitative Data Collection | p. 161 |
Qualitative Data Collection | p. 161 |
Analyzing the Data and Reporting the Results | p. 163 |
Measuring Effectiveness | p. 172 |
Improved Estimating Practices | p. 173 |
Summary | p. 175 |
References | p. 175 |
Where Are We in Relation to Industry Peers? | p. 177 |
Comparing to Industry Data | p. 178 |
Where Does the Data Come From? | p. 178 |
Comparative Data Points | p. 180 |
Developing a Baseline | p. 180 |
Initialization | p. 181 |
Establishing Baseline Objectives | p. 181 |
Defining Baseline Deliverables | p. 181 |
Identifying Key Data Elements | p. 182 |
Data Collection | p. 182 |
Defining the Data Collection Process | p. 182 |
Collecting Quantitative Data | p. 182 |
Collecting Qualitative Data | p. 182 |
Analysis | p. 183 |
Establishing Performance Profiles | p. 183 |
Establishing Internal Benchmarks | p. 183 |
Comparing Findings to Industry Data | p. 183 |
Project Performance Baseline | p. 183 |
The Baseline Process | p. 184 |
The Collection Process | p. 184 |
Quantitative Data | p. 184 |
Qualitative Data | p. 185 |
Baseline Deliverables | p. 185 |
Analysis of Process Strengths and Weaknesses | p. 187 |
Not-for-Profit Industry Data Sources | p. 189 |
ISBSG | p. 189 |
Software Engineering Institute Data | p. 190 |
The Importance of Auditing | p. 191 |
Objectives of an Audit | p. 192 |
Scope of the Audit | p. 192 |
The Auditing Process | p. 193 |
Problem Resolution | p. 194 |
Summary | p. 194 |
References | p. 195 |
How Can We Do IT Better? | p. 197 |
The IT Industry Context | p. 197 |
Case Studies | p. 199 |
Large Financial Institution | p. 200 |
Mid-Size Insurance Company | p. 202 |
Large Service Organization | p. 203 |
Performance Modeling | p. 204 |
Summary | p. 205 |
How Should We Change? | |
How Can We Manage IT Changes? | p. 209 |
The Need for Change Management | p. 209 |
Types of Change | p. 210 |
Seven Principles of Managing Change | p. 211 |
Two Levels of Management Support | p. 211 |
Proper Funding | p. 212 |
The Business Case | p. 213 |
Setting and Managing Expectations | p. 213 |
It's About the People | p. 214 |
Communicate, Communicate, Communicate | p. 214 |
Measurement Is Key | p. 214 |
Managing Resistance | p. 215 |
Using a Change Agent or a Coach | p. 217 |
Summary | p. 218 |
Further Readings | p. 218 |
How Should IT Manage Risk? | p. 219 |
Why Perform Risk Planning? | p. 220 |
How to Begin Risk Planning | p. 221 |
How Does Security Relate to Risk Planning? | p. 225 |
What Legislation Has Affected Risk Planning, and Why? | p. 226 |
Sarbanes-Oxley Act of 2002 | p. 226 |
Health Insurance Portability and Accountability Act of 1996 (HIPAA) | p. 227 |
Gramm-Leach-Bliley Act of 1999 (GLB Act) | p. 228 |
Summary | p. 229 |
Reference | p. 229 |
How Should IT Manage Its People? | p. 231 |
What Should You Expect From Your CIO? | p. 232 |
Leadership | p. 232 |
Management Skills | p. 233 |
Communication Skills | p. 234 |
Technical Expertise | p. 235 |
Business Expertise | p. 235 |
Vision - Ability to Create and Manage Change | p. 236 |
Ability to Hire, Develop, and Retain High-Quality IT Professionals Who Can Work Together | p. 237 |
International or Global Experience | p. 239 |
Industry-Specific Experience | p. 240 |
Relationship Skills | p. 240 |
IT Staff as Assets | p. 240 |
IT Staff and Change | p. 243 |
IT Staff as Stakeholders | p. 245 |
Summary | p. 248 |
References | p. 248 |
What Should IT Expect From the Business? | p. 249 |
It's the Relationship That Matters | p. 249 |
Develop an Operating Model | p. 250 |
Statement of Commitment | p. 253 |
Summary | p. 254 |
References | p. 254 |
Index | p. 255 |
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