performance measures 3
- Performance Measures
The purpose of this section is to let the decision-makers know how they can determine whether they are receiving the expected benefits from the system, beyond whether they are receiving the return on investment, as calculated in Section VIII.If the system proposed in the business case is approved and implemented, the organization will, at some point, need to assess whether it is receiving the expected benefits.To assist in determining this, performance measures are used.These measures refer to the impact the system is having on the business, not IT system performance measures used to determine how well the system itself is performing.The performance measures are derived from the business problems and/or opportunities and the expected benefits documented in the business case.The team should identify four performance measures and complete the table below:
|
Problem or Expected Improvement |
Metric – used to measure |
Source of Data |
Baseline |
Target |
Time-frame |
In addition to the table, an appropriate introduction to the table is to be provided to put it into context in the business case.A brief explanation should be provided for how the proposed system will enable or support the improvements listed.
Approach to Developing this Section
Review Sections II and IV, in particular, of the business case.In Section II, the business problem(s) and/or opportunities were identified, and in Section IV the improvements/benefits to be realized from the proposed solution were identified.Now select and quantify four improvements or benefits and determine how success can be demonstrated, once the solution is implemented.
For example, if one business problem is to increase profits, and that the proposed solution would contribute to increasing profits, then the entries in this table would identify:
- The problem – increasing profits
- The metric – what “item” can be measured to determine if profits are increasing (e.g., total monthly sales amount minus expenses/costs)
- The source of the data – information to be used to determine if the target has been met (e.g., monthly sales total and expense/cost total from the financial report)
- The baseline – what the source of the data reports for the current way of doing business, prior to system implementation (e.g., what the monthly profits are before the system is implemented)
- The target – that shows how much improvement over the baseline is expected (e.g., how much monthly profits should increase), and
- The timeframe – timeframe (“immediately,” “six months after implementation,” etc.) by which the target should be attained (e.g., how long after system implementation the monthly profits should reach the targeted improvement).
The table must have an appropriate introduction to put it into context in the business case.Each of the performance improvements listed should also be briefly explained to show how the system being proposed in the business case will actually impact in those areas.So, for the example above, if the proposed system were a Supply Chain Management (SCM) system, then it should be explained how implementing an SCM and having a more complete inventory of goods would contribute to increased profits.
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