The KPI Conundrum: Are You Really Moving the Needle?

In an evolving digital landscape, are we measuring the right things? Key performance indicators (KPIs) can seem staid and old-school, but credible measurement of results is a common struggle for any organization managing change.

Recently, our SFG team participated in an informal panel discussion with product and service companies to talk about the best metrics to understand digital transformation progress, challenges and failures. The consensus of the group’s discussion is that leaders today advocate action-oriented and defined approaches to measurement centered around revenue or the customer. It’s no longer the era of implementing a new system and simply hoping for long-term ROI to show up in a non-specific indicator six months later.  So how do you do it?

If you aren’t measuring the right things during a digital transformation, is the needle really moving? 

 Successful transformation simply must be driven by tangible goals with outcomes in mind from the start. But a big challenge centers around what to measure in order to quantify success.  Are transformational initiatives streamlining the business, delivering on product or services, and monetizing efforts?  The argument for using traditional KPIs is to tap metrics already in place so data will be consistent with stated corporate goals. On the other end of the spectrum, many standard KPIs may be too traditional for the changing digital landscape and won’t correctly analyze the information that transformational advancements create. In addition, it often takes too long to harvest and analyze the data. Many in the group complained that their metrics are outdated, oriented to infrastructure or basic service and simply no longer relevant, or altogether nonexistent.

Can We Solve the KPI Conundrum?

A few of the more experienced members of the panel said that data collection, feedback and monitoring work best when it is intrinsic to the DT effort itself, with two to four data collection points at critical release junctures, feature activations and phases for client/customer response about satisfaction and service.

These are all big questions for today’s IT leaders.  In fact, the Wall Street Journal recently looked at how IT executives are finding value in real-time metrics.  According to the WSJ, as CIOs need to prove the value of IT as a revenue generator, metrics are key.  New tools are allowing CIOs daily visibility into their organizations.

Across the board, both panelists and audience members agreed that alignment on quantification is instrumental to success and progress, as is early course correction, in digital projects. The bottom line is that every business, and every transformation, is unique.

Defining your expected outcomes from the start is key to how you can measure more effectively to actually see the needle move on your transformation progress.

Maureen Vavra

Benchmarking that Propels Transformation Forward

Digital transformations are even more impactful, and often more disruptive, to corporations and their cultures than traditional IT transformations, which focus primarily on systems. The business value impact can be substantial, as is the risk of failure.

Benchmarking can help crystalize targeted outcomes by identifying what measurements are most important and showing progress against both internal and external guideposts. Whether they are used to compare to a competitor, track current performance, or understand the impacts of an industry trend, benchmarking can serve as a catalyst for achieving transformation goals.

How can IT leaders can drive successful digital transformation through benchmarking?

• Engage Your People
  Ensure that your transformation benchmarking is heavily informed by the people who will actually lead and work on transformation initiatives. While external benchmarks are valuable guideposts, your people and teams know best what your organization can handle.
• Be Clear on Timing
  Benchmark early in transformation scope planning. Delaying benchmarking until you are at the doorstep of implementation risks missing key signals that can come from benchmarking at the outset of business process redesign and the insight that comes from systematically testing and monitoring early stage transformation efforts.
• Support the Leadership Conversation
  Use measures to facilitate a regular executive conversation on your company’s strategic digital health. The right high-level measures give feedback on the pace of transformation that elevates the dialog above the quarterly tug of war. The ability to continue collaborative conversations beyond your last strategic off-site can improve your partnering dynamic and keep the focus where it belongs – digital competition.

When these benchmarking steps are addressed appropriately, several enablers of transformation success are bolstered:

• Clear, shared and measurable expectations and progress milestones are set
• Feedback loops focused on tangible, actionable points are established
• Course correction earlier in the process appropriately adjusts future targets
• Effective communication that demonstrates progress and motivates people and teams

We have more to cover in our ongoing benchmarking series. For now, we would love to hear from you about what role benchmarking plays in your organizations, where you run into challenges and how you are solving for success.

Maureen Vavra

This is the second installment in StrataFusion’s benchmarking series.

StrataFusion Expands Expertise in Digital Transformation and NextGen IT Readiness with Edward Wustenhoff

New Partners, Diverse Experience

StrataFusion understands the spectrum of needs clients face and is expanding its partnership with experts who are solving today’s business challenges.  Earlier this year, StrataFusion welcomed new partner Edward Wustenhoff, whose background brings exceptional expertise in digital transformation, design, management and continuous improvement.

Since joining StrataFusion earlier this year in February, Edward has been helping clients to move their IT infrastructure teams and technology toward the next generation of IT readiness for cloud, containers and distributed micro services.

Edward guides IT organizations to stay aligned with the latest organizational principles, processes and technologies. He brings a strategic mindset of how to transition IT organizations and enable new technologies for business success. Leveraging his deep understanding of all aspects of cloud services, Edward is uniquely qualified to help organizations adapt to the ever-changing landscape of IT technologies and the associated management challenges that come with transformation. With an impressive record of success gained from several decades driving design and adoption of world-class technology infrastructures, global operations management and deep technology provider understanding, Edward adds an exciting dimension of executive-level insight to advise StrataFusion clients.

Before joining StrataFusion, he was responsible for internal IT infrastructure at industry leaders like Netflix and Applied Materials. Serving as a Chief IT Consultant at Sun Microsystems, he developed and published the Operations Management Capability Framework and Model, and the associated assessment service for the Professional Services division. He also was part of the Advanced Internet Practice helping ISPs and ASPs design, deploy and manage large-scale infrastructures.

“The depth of experience that Edward brings to our partnership at StrataFusion adds another dimension of capability to serve our clients,” says Ken Crafford, StrataFusion’s founding partner. “Our clients face many challenges as the business landscape evolves, and our aim is to always have the right expertise to help navigate change and continuously improve.”

Need guidance from a trusted advisor? Learn more about StrataFusion here.

Will Digital Transformation Ever End?

Three focus areas to help business navigate never-ending change

Technology is changing the world faster than ever before. As consumers and as business leaders, we now navigate each day with an expectation of change.  The digital transformation that is sweeping the economic landscape certainly makes for exciting experiences but also requires businesses to be more agile than ever before and quickly adapt to market needs.

So what should technology leaders do to help the business adapt?

1. Be part of strategic decision-making: Today’s technology leaders aren’t just focused on the network and systems. Modern technology strategy is crucial to innovation and should be focused on holistic business adaptability and helping their organization rapidly develop high-quality products and services to drive customer experience. Internal business partners must also leverage technology to accomplish their goals and seize opportunities.
2. Know the customer and provide an incredible experience: You don’t have to look far to see major consumer disruption examples, from the way people want to shop, bank and travel. The same is true for business customers. But too often, technology leaders become bogged down in the actual technology and lose track of their customers and what they need. Leaders should be talking to customer regularly to understand the problems they are solving. In fact, 62 percent say delivering an excellent customer experience defines success as a digital-first business. Check out IDG’s 2018 State of Business Transformation.
3. Be agile and be fast: Fast-moving change is one thing business leaders can all count on. With blockchain, IoT, big data, and mobile computing becoming mainstream topics, the never-ending “need for speed” will continue fueling transformation. Technology leaders are key players who must strategically guide organizations through disruption and provide the insights and expertise for decisive decision-making to move fast.

So will digital transformation at some point end? Yes and no. With the expectation of never-ending disruption ahead, what will come after the “digital” transformation — the AI transformation or the VR transformation? Whatever it is, change-ready technology leaders who are focused on strategy and embrace a customer-centric mindset will be well prepared to define business outcomes and set the pace to ensure business relevancy and success. And while the “digital” part will inevitably shift at some point, continuing transformation is a safe bet for the future.

Mark Egan