Chapter 4:
Measuring the Success of Strategic
Initiatives
CIS 429—BUSINESS INFORMATION SYSTEMS
Measuring IT Success
 “You can’t manage what you don’t _________”
 http://management.about.com/od/metrics/a/Measure2Manage.
htm
 ___ invested $1.5 billion on a real-time operations
monitoring system (est. 33% return over 5 years)
 Metrics are required to measure business success
 Metrics feed key performance indicators (KPIs)

“Key Performance Indicators are quantifiable measurements,
agreed to beforehand, that reflect the ________ success factors
of an organization.”
http://management.about.com/cs/generalmanagement/a/keyper
findic.htm
Efficiency and Effectiveness
 Firms spend up to ____% of total capital expenditures
on IT—is the investment worth it?
 Efficiency: doing things _______

Optimally, least amount of resources
 Effectiveness: doing the right things
 Achieving goals
 Efficiency IT metrics
 Measure the performance of the IT system
 Effectiveness IT metrics
 Measure the impact of IT on the business
Benchmarking—Baseline Metrics
 Benchmark
 A __________ measure used to assess the performance of a
company
 Benchmarking
 Measuring progress toward a goal at intervals prior to the
anticipated attainment of the goal
 “Benchmarking is the process of determining who is the very best,
who sets the standard, and what that standard is.”
http://management.about.com/cs/benchmarking/a/Benchmarki
ng.htm
The Interrelationships of Efficiency and
Effectiveness IT Metrics
 Efficiency IT metrics
 Throughput, ___________ speed, system availability, …
 Effectiveness IT metrics
 Usability, customer ____________, conversion rates, …
 eBay uses efficiency metrics to improve its effectiveness
metrics
 High efficiency often leads to ____ effectiveness
Determining IT Efficiency and Effectiveness
 Financial metrics are commonly used by business
 Customer metrics may be just as important
 Market share, customer acquisition, customer ____________,
…
 Web traffic analysis
 ________: a small file deposited on a hard drive by a web site




Additionally, it is information for future use that is stored by the
server on the client side of a client/server communication
Click-through: a count of users who click on an ad
Banner ad: a small ad on a web site
Interactivity: measuring interaction with an ad