Business Driven

Technology
Unit 1
Achieving Business Success

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 Unit One
O Chapter 1– Business Driven Technology

O Chapter 2 – Identifying Competitive Advantages

O Chapter 3 – Strategic Initiatives for Implementing

Competitive Advantages

O Chapter 4 – Measuring the Success of Strategic

Initiatives

O Chapter 5– Organizational Structures that Support

Strategic Initiatives

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 Chapter 4
Measuring the Success of
Strategic Initiatives

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 LEARNING OUTCOMES
1. Define metrics and describe the
relationship between efficiency IT
metrics and effectiveness IT metrics
2. Explain why a business would use
metrics to measure the success of
strategic initiatives

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METRICS: MEASURING SUCCESS
O Project – A temporary activity a company
undertakes to create a unique product,
service, or result
O Metrics – Measurements that evaluate
results to determine whether a project is
meeting its goals

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METRICS: MEASURING SUCCESS
O Critical success factors (CSFs) – The crucial
steps companies make to perform to achieve
their goals and objectives and implement
strategies
O Create high-quality products

O Retain competitive advantages

O Reduce product costs

O Increase customer satisfaction

O Hire and retain the best professionals

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METRICS: MEASURING SUCCESS

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METRICS: MEASURING SUCCESS

O Key performance indicators (KPIs) – The

quantifiable metrics a company uses to
evaluate progress toward critical success
factors
O Turnover rates of employees

O Number of product returns

O Number of new customers

O Average customer spending

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 Efficiency and Effectiveness
O Efficiency MIS metric – measures the
performance of the MIS system itself including
throughput, speed, and availability

O Effectiveness MIS metric – measures the

impact MIS has on business processes and
activities including customer satisfaction,
conversion rates, and sell-through increases

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 Benchmarking – Baselining
Metrics
O Benchmarks – baseline values
the system seeks to attain

O 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

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 The Interrelationships of Efficiency
and Effectiveness MIS Metrics
O Efficiency MIS metrics focus on technology
and include:
O Throughput
O Transaction speed
O System availability
O Information accuracy
O Web traffic
O Response time

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 The Interrelationships of Efficiency
and Effectiveness MIS Metrics
O Effectiveness MIS metrics focus on an
organization’s goals, strategies, and
objectives and include:
O Usability
O Customer satisfaction
O Conversion rates
O Financial

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 The Interrelationships of Efficiency
and Effectiveness MIS Metrics
O Security is an issue for any organization offering
products or services over the Internet

O It is inefficient for an organization to implement

Internet security, since it slows down processing
O However, to be effective it must implement Internet
security
O Secure Internet connections must offer encryption
and Secure Sockets Layers (SSL denoted by the lock
symbol in the lower right corner of a browser)

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 The Interrelationships of Efficiency
and Effectiveness MIS Metrics
O Interrelationships between efficiency and effectiveness

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 Metrics for Strategic Initiatives
O Metrics for measuring and
managing strategic initiatives
include:
O Website metrics
O Supply chain management (SCM)
metrics
O Customer relationship
management (CRM) metrics
O Business process reengineering
(BPR) metrics
O Enterprise resource planning (ERP)
metrics

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 WEBSITE METRICS
O Website metrics include:
O Abandoned registrations
O Abandoned shopping cards
O Click-through
O Conversion rate
O Cost-per-thousand
O Page exposures
O Total hits
O Unique visitors

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 SUPPLY CHAIN MANAGEMENT
METRICS
O Back order
O Customer order promised cycle time
O Customer order actual cycle time
O Inventory replenishment cycle time
O Inventory turns (inventory turnover)

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 CUSTOMER RELATIONSHIP
MANAGEMENT METRICS
O Customer relationship management
metrics measure user satisfaction and
interaction and include
O Sales metrics
O Service metrics
O Marketing metrics

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 BPR AND ERP METRICS
O The balanced
scorecard
enables
organizations
to measure
and manage
strategic
initiatives

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LEARNING OUTCOME REVIEW

O Now that you have finished the

chapter please review the learning
outcomes in your text

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