Metrics, A Top-Down Balanced Scorecard Approach

METRICSA TOP DOWN, BALANCED

SCORECARD APPROACH FOR THE SUPPORT CENTER

How important are metrics to the support industry?

• Strategic Advisory Board-whitepaper• Most frequent questions received by HDI member

services center• First chapter in the book “Implementing Service and

Support Management Processes: A Practical Guide”• Popular topic for the HDI Executive Forum• SPIN content delivered by Ron Muns—largest

attendance so far• Newest member deliverable—Metrics Series

So, what is a “metric”???

A metric is a measure of anything.

KPI (Key Performance Indicator):

A Key Performance Indicator is a metric—however, a metric is not always a KPI.

A KPI is a measurement that matters and is ideally actionable.

Dashboard:

A tool used by managers and executives to monitor business performance

A dashboard is the critical delivery vehicle for performance metrics.

Balanced Scorecard (BSC):

Provides a clear view as to what organizations should measure in order to “balance” the financial perspective with the service perspective.

The BSC is a management system.

A company may have many metrics but few KPI’s.

How do we get to our short list of agreed upon key measures?

First you must ask,

“What do we value?”

• Customers or Employees?

• Cost Control or Organizational Development?

• Service reputation or profitability?

I’ve learned that you can’t have everything and do everything at the same time.

Oprah Winfrey

BSC model recognizes business complexities

• Multiple priorities often conflict

• Avoid single metric focus (i.e. cost/call)

The Process

• First, all participants need a clear and consistent understanding of the organization’s overall high level strategies and culture.

Assembling a qualified team is a necessary requisite. The team should consist of not only IT management but also their business counterparts.

If the CEO/COO is not directly involved, they should at least sign off on the finished scorecard.

• Second, everyone on the team should know, “What is this business trying to accomplish?” What are the company’s goals and objectives for the short and long term?

• Third, determine the key business drivers

• Fourth, determine what measures will tell you how well the organization is doing. What are the key performance indicators?

• Finally, look at existing systems that will enable you to calculate and report your KPI’s.

KPI’s should offer a good mix of financial as well as operational measures.

A BSC looks beyond financial measures.

Financial measures generally look at the past (how the organization performed historically). Non financial measures frequently offer a good indicator of the future.

The goal of the Balanced Scorecard Service Model for the Support

Center is to balance service goals and financial goals.

Customer Satisfaction Goals• Supporting KPI’s • •

Employee Satisfaction Goals• Supporting KPI’s• •

Costs/Productivity Goals• Supporting KPI’s• •

Organizational Maturity Goals• Supporting KPI’s• •

The key to a successful Support Center Balanced Scorecard Service Model is to maintain continued balanced improvement in all four quadrants over time.

Customer Satisfaction Goals• Generally measured via customer

surveys• Primary survey is transaction based• Secondary survey is a loyalty survey• Overall customer satisfaction is one of

the primary drivers in contract renewal rates for externally facing Support Centers.

Examples of Customer Satisfaction KPI’s:

• Accuracy/Timeliness/Courtesy/Skills

• Overall satisfaction

• Average speed to answer

• Abandon call %

• Self-service tool utilization %

• SLA performance

Employee Satisfaction Goals• In any service business, the people who deliver that

service are the essential product• Average time to fully train a new employee in

customer support ranges from a few months to a year or more

• Some turnover can be healthy... excessive turnover can have a significant negative impact on operations

• Employee surveys should be conducted once or twice a year.

• Companies that effectively manage employee satisfaction do not always have the highest pay scales for their industry or area.

Examples of Employee Satisfaction KPI’s

• Turnover

• Sick days

• Employee satisfaction scores

• Training days per year

• Time to proficiency

Costs/Productivity Goals• Our industry must agree on definitions and

methods for developing cost metrics• Valuable comparisons depend upon common

definitions, common volumes, common costs and common methodologies

• Financial KPI’s are dependent on calculating costs in terms of cost per unit of work and per service delivered

• Must be analyzed in conjunction with service goals

Examples of Costs/Productivity KPI’s:

• Costs per incident (by channel)

• Customers per Support FTE (full time employee)

• Incidents handled per Support FTE

• Utilization rate

Organizational Maturity Goals• Most strategic and subjective of the four quadrants• Focused on the structure, ability to change,

quickness, responsiveness, and strategic positioning of support within the larger organization

• Enables customer and employee satisfaction with optimal cost structure

• All world class organizations are constantly challenging themselves to find ways to continuously improve their operational efficiency

Examples of Organizational Maturity KPI’s:

• Executive support

• Time to product proficiency

• Workforce diversity

• Problem elimination value

• Process formalization

• Certifications and standards efforts

Implementation of a BSC Service Model• Review the listing of KPI’s for each of the

quadrants—Keep goals and strategies in mind• Remember that success will depend on

maintaining a documented model and tracking progress over time

• Keep it simple• Analysis is the valuable part• Intent should be to take action if action is

warranted

SUMMARY• Goals need to be agreed to by not only the Support

Center but also the COO, CEO and/or CFO• Objective is to have continuous, balanced

improvement in all quadrants• KPI’s are tools and not objectives• Reporting should go both up and down the chain of

command • The process can be applied to operations ranging from

a simple internal IT Support Center to a larger multi-customer Support Center organization

HDI Update

MEMBERSHIP• Expanded SupportWorld circulation• Vertical market emphasis

– Surveys– Forums– Web presence

• Practices survey is available• SAB – new format for deliverables• LC Officer Summit was last week

EVENTS• ITIM 2005

– October in Orlando– Produced solely by HDI – Refocused content

• Emerging Technologies• IT Leadership• Network Optimization and Performance• Infrastructure Management Technology Innovation• Security, Governance and Compliance• IT Service Management

• HDI 2006– March 19 – 22 in Nashville

TRAINING• New and improved curriculum for HDA

Bootcamp (to include CSS)• New “Team Lead” course• Standards committee are set – over 40

volunteers• Exploring potential new courses including

some ITIL based courses• New LMS for online course management

New Initiatives• Customer Satisfaction Survey Project

• Web Enhancements– Navigation– Presentation of Content– Call for volunteers