How do I measure the success of IT Projects?

Too often I see the wrong metrics used to measure the success of IT Projects or worse no metrics at all being used to measure impact. Typically the implementation of the IT components and how they are functioning is being measured instead of the impact of IT on a system. This makes no sense. You want to measure the impact of IT not its implantation.

How do you measure the impact of IT on the system?

To measure the impact of IT on a system you need to:

  1. take a baseline measure of the system before the IT system was implemented
  2. take a measurement after implementation

There are 2 key performance measures that we use, these are effectiveness and efficiency:

  • Effectiveness: To measure effectiveness we are looking at how many errors we are making during the execution of a process.
  • Efficiency: To measure efficiency we are looking at how long it takes to complete a process.

To do this we take a measurement before the implementation of a solution and then after. A positive change in either of the metrics means we were successful. For effectiveness we want to see less mistakes being made during the execution of the process and for efficiency we want to see less time being taken to complete the process. No change or negative change means we were unsuccessful with the initiative.

three men sitting on chair beside tables


One way to measure the effectiveness of a process is to use a confusion matrix. A confusion matrix is measurement method used to visualize how many errors were made in a system. The beauty of the confusion matrix is that it actually allows us to see where the process fails and where it succeeds.

Error Rate = Type 1 error + Type 2 error


One way to measure the efficiency of a process is to measure the Lead time. The lead time is made up of the reaction time + the cycle time. Lead time measures the total time it takes for work to move through the workflow, from the moment the work is requested to the moment it’s delivered, including time it stays in queues (i.e. the Reaction time). Cycle time measures how long the team actually works on the task.

How to measure efficiency – Lead Time = Reaction Time + Cycle time

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