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CHIPS Articles: Guide for Developing and Using Information Technology Performance Management

Guide for Developing and Using Information Technology Performance Management
By Joeneicy Lewis - January-March 2002
Background

One of the underlying tenets in pursuit of information superiority in the Department of the Navy (DON) is the ability to focus resources on Information Technology (IT) investments that are the most effective in achieving that superiority. This is manifested directly by investing in IT programs and projects that support the warfighting mission by providing secure information when and where they are needed. It is also manifested by focusing on IT investments that improve the mission and strategic objectives of all DON organizations, afloat and ashore, that directly or indirectly support the warfighting mission.

The Government Performance and Results Act of 1993 (GPRA) directs that agencies report performance through measures that relate to their strategic goals. The Clinger-Cohen Act of 1996 (CCA) further directs that agencies manage IT using performance measures that measure how well the IT supports their missions.

The DON Chief Information Officer (DON CIO) has developed the IT Capital Planning and Portfolio Management processes to assist DON organizations with their responsibilities and initiatives related to selecting, managing, and evaluating IT investments to be compliant with GPRA and CCA. The DON IT Performance Measures Guide supplements the IT Capital Planning and Portfolio Management processes by providing an outcome-oriented method for measuring the impact of IT investments on the organization's mission, goals, and objectives. To achieve this end, this guide recommends the use of Kaplan and Norton's Balanced Scorecard, modified for the federal government.

Execution

The process for developing and managing IT performance measures is an iterative one that begins with the definition of the investment and involves constant refinement and management throughout the life cycle of the asset. Figure 1 illustrates the process.

Step 1 – Define IT Investment. Review the Mission Need Statement, Operational Requirements Document, or other requirements documentation to understand the nature and intent of the investment and how the investment supports the mission of the organization.

Step 2 – Develop IT Performance Measures. Develop objectives, associated measures, and actions to achieve the objectives, within each of the five Balanced Scorecard Perspectives.

Step 3 – Identify Baseline Data. Identify data that already exists and the requirements for the collection of new data that will be used to support the baseline of information required by the measures developed in Step 2.

Step 4 – Develop Data Collection Methods. Develop methods and procedures for collecting, storing, and updating the data identified in Step 3 to satisfy required reporting frequencies.

Step 5 – Develop a Performance Plan. Develop a plan that describes how the organization will review objectives and measures developed for the IT asset, and how corrective actions will be taken to achieve intended targets. Corrective actions can involve such things as modifying internal processes to more effectively use the investment or taking action to modify or cancel the IT investment based on its ability to achieve some or all of its intended objectives.

Step 6 – Collect Data and Report Performance. Begin collecting and updating the data as determined in Step 4. The data should be displayed in a manner, and with the required frequency, to effectively evaluate actual performance of the investment in comparison to the target performance for each measure.

Step 7 – Assess Performance, Refine and Adjust. Take the corrective actions identified in the Performance Plan from Step 5 based on periodic reviews of the reports from Step 6.

Conclusion

The Balanced Scorecard, using the process described in the DON IT Performance Measures Guide, substantially increases the likelihood that:

- Investments will be linked to overall mission support and improvement.
- Realistic objectives will be considered for IT investments.
- Actual performance of the investment will meet or exceed its intended purpose.
- Corrective actions will be taken in a timely fashion if performance requirements aren’t met.

The scorecard provides a model for ensuring that the investment will be continually evaluated from the perspective of the customer and the stakeholder, and will also be continually evaluated from a financial perspective. The model helps ensure that objectives and measures are evaluated related to the perspectives of learning and growth, and internal processes within the organization.

From this standpoint, it is a far better method of measuring performance as compared to traditional cost and performance measures. The real value to the DON is its strength in increasing the probability that IT investments lead to improved mission performance and information superiority.

The DON Guide for Developing and Using IT Performance Measurements was issued on Oct. 17, 2001, signed by Mr. Dan Porter, the DON CIO. This article presents a summary of the guide.

Go to the DON CIO website for more information about performance measurement: http://www.doncio.navy.mil/

The IM/IT Performance Measurement IPT includes: Joeneicy Lewis, DON CIO sponsor; Stan Beall, SPAWAR team lead and SPAWAR team members: Myra Rice, Ginny Szabad; Kathryn Burns, GDSS; Sherry Brown, NAVAIR; Melody Potter, BUPERS; Claude Speed and Carol Stephens, NAVSEA; and Tom Tomcich, OPNAV N4.

Figure 1 illustrates the process overview. Define IT investment, then develop IT performance measures, identify data and baseline, develop data collection methods, develop performance plan, collect data and report performance and assess performance, refine and adjust.
Figure 1.
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