IT metrics Essay Example | Topics and Well Written Essays - 750 words

IT metrics - Essay Example The economic value of IT to a company tends to depend on the particular business needs of the company under focus. Broadly speaking, IT tends to contribute to four major areas in nearly all businesses. These areas include the corporate market position and revenue generation; customer support for business operations; direct and indirect fiscal benefits such as cost savings; and investments in IT that enhance the business operations through value addition. Depending on the nature of the business in focus, it would be pertinent to measure the value of IT contribution accordingly. It has been suggested that IT’s contribution to economic value can be measured most effectively considering the absence of the relevant IT services to a business (Sliger & Broderick, 2008). The economic value of IT to a business can be measured best when considering what would happen if IT services and goods were removed. Although this may seem an extreme method of quantification, it provides the most re alistic scenario. In a similar manner, businesses should focus on areas that matter most - such as the delivery of goods to customers after booking. This allows businesses to see how IT adds to the baseline operations and lets the business realize in what way IT system would augment revenues best. The implementation of IS in a business operation is to ensure that security breaches are not able to affect the entire business operation negatively. Quantifying the returns provided by IS to a business operations environment may not be simple at all.... This allows businesses to see how IT adds to the baseline operations and lets the business realize in what way IT system would augment revenues best. IS Value Assessment Models The implementation of IS in a business operation is to ensure that security breaches are not able to affect the entire business operation negatively. Quantifying the returns provided by IS to a business operations environment may not be simple at all. On the one hand, there are businesses that are transacting secure information such as credit card numbers using IT; on the other hand, there are businesses that are doing little more than providing customer support online. Using similar methods to measure IS value addition for various businesses is highly unrealistic so various models are in place that depend in large part on the nature of the business in question. It is recommended that businesses define in detail what areas are to be valued most in terms of security. The reasons behind such value addition class ification should also be expounded based on value addition to business operations. Once such value addition areas have been specified, the next step should be to classify IS value addition (Tsiakis & Pekos, 2008). Applicability of Traditional Financial Ratios and Measurements Traditional financial ratios and measurements cannot be applied to IT and IS directly, but instead, they require some manipulation before they can be applied. It is pertinent to note that fiscal ratios and measurements are not fully applicable to a number of different IT and IS areas such as the provision of bandwidth, virus detection rates, etc. However, this does not indicate that fiscal ratios and