chapter 4:Measuring the success of Strategic Initiatives

salam guys. today I will share to u a little bit about chapter 4. this topic will basically thought us about:

Efficiency and effectiveness IT metrics are two ways to measure the success of IT strategic initiatives–Efficiency IT metrics – measure the performance of the IT system itself including throughput, speed, availability, etc.–Effectiveness IT metrics – measure the impact IT has on business processes and activities including customer satisfaction, conversion rates, sell-through increases, etc.

BENCHMARKING – BASELINING METRICS

Benchmarks – baseline values the system seeks to attain

Benchmarking – a process of continuously measuring system results, comparing those results to optimal system performance (benchmark values), and identifying steps and procedures to improve system performance

what i know about this,it is about:
" making comparisons of past performance to current performance. A baseline may also be forward-looking, such as when you establish a goal and are seeking to determine whether the trends show you're likely to meet that goal—an essential piece of a Key Performance Indicator (KPI). Baselines have been around for as long as there have been analytic approaches to measuring execution and its results—in business, athletics, and medicine, to name a few."

THE INTERRELATIONSHIPS OF EFFICIENCY AND EFFECTIVENESS IT METRICS 

• Efficiency: IT metrics focus on technology and include:
  –Throughput – amount of information that can travel through a system at any point in time
  –Speed – amount of time to perform a transaction
  –Availability – number of hours a system is available
  –Accuracy – extent to which a system generates correct results
  –Web traffic – includes number of pageviews, number of unique visitors, and time spent on a Web page
  –Response time – time to respond to user interactions


• Effectiveness: IT metrics focus on an organization’s goals, strategies, and objectives and include:
  –Usability – the ease with which people perform transactions and/or find information
  –Customer satisfaction – such as the percentage of existing customers retained
  –Conversion rates – number of customers an organization “touches” for the first time and convinces to purchase products or services
  –Financial – such as return on investment, cost-benefit analysis, etc.


• Security is an issue for any organization offering products or services over the Internet


• It is inefficient for an organization to implement Internet security, since it slows down processing time. However, to be effective it must implement Internet security
  –Secure Internet connections must offer encryption and Secure Sockets Layers (SSL denoted by the lock symbol in the lower right corner of a browser)

DETERMINING IT EFFICIENCY AND EFFECTIVENESS

• Customer metrics – assess the management of customer relationships by the organization and include:
  –Market share
  –Customer acquisition
  –Customer satisfaction
  –Customer profitability

Web Traffic Analysis

• Most companies measure the traffic on a Web site as the primary determinant of the Web site’s success


• However, a large amount of Web site traffic does not necessarily equate to large sales


• Many organizations with high Web site traffic have low sales volumes


• Web site traffic analysis can include:
  –Cookie – a small file deposited on a hard drive by a Web site containing information about customers and their Web activities
  –Click-through – a count of the number of people who visit one site and click on an advertisement that takes them to the site of the advertiser
  –Banner ad – a small ad on one Web site that advertises the products and services of another business, usually another dot-com business
  –Interactivity – visitor interactions with the target ad