01.18.09
What is most Important, the Dairy or the Milk?
When considering the importance of the milk, the buyer will look at the cost, the quality, and the expiration date. The farmer will consider the cost, the quality, and delivery time of the milk as key performance indicators of the dairy. The farmer knows that there must be continuous work to keep the dairy clean and up to the best operating standards or else there may be times when he may have to pour out contaminated or poor quality milk. If the farmer does not provide the quantities needed in the timeframes needed, another dairy may take his customer away.
If we use the dairy and the milk as an analogy to IT, the milk is the information value provided and the dairy is the processing engine needed to deliver the value. Now let’s consider the important measures coming from the client.
The cost should be competitive. When the IT group is internal, there is no comparison on cost. The issue almost becomes “how much is the customer willing to pay?” There is no comparison shopping. This is why major IT improvements require special boards of approval because these efforts are usually significant budget items.
The information value should be of the highest quality. This is a tough one to measure. On the value side, the business may be able to estimate a bottom-line value. Quality may be stated in some form of service-level agreement. Here again, with an internal IT shop the SLA becomes more of a negotiation process rather than a competitive distinction.
Quantity is the easiest of the measures for IT. If IT can do one right, it should be able to do a million right. This actually becomes a scaling issue. Unless there is proof through simulated production loads, this is a buyer beware issue.
The last item, delivery time, is clearly measurable. When will IT be able to provide this value? The actual delivery may have many steps, but at some specific point in time there is supposed to be a completion.
The farmer knows that the dairy will determine all aspects of the milk produced. In the analogy to IT, the same is true. The processing engine will determine the value of the information provided. But there is an exception for an internal IT shop; only one KPI will emerge for a particular product. Only the delivery schedule is important. Due to the lack of competition, the other measures are lost.
With the primary measure being the delivery of the product, anything goes that can make sure that the target date is reached. Quality and cost take a backseat and duct tape solutions become more the rule than the exception. Those that apply the duct tape are looked to as heroes even though there will be debt to pay in the future. The bottom line then is that for an internal IT function, the milk is more important than the dairy. Try and explain that to a dairy farmer.
