While most organisations have adopted formal service-level agreements (SLAs), they only meet these agreements 74 per cent of the time on average, according to new research by Forrester Consulting. The research, commissioned by Compuware, found that the primary reason for missing SLAs is that the business unit has expectations out of the reach of IT.
The Forrester study found that 41 per cent of respondents agreed that their insight into service levels is basic, and that they don't regularly provide SLA information to executives. Forty per cent of those surveyed agreed that their service level reporting lacks information that their executives have requested.
According to Jean-Pierre Garbani, vice president and principal analyst with Forrester Research: "The ultimate judge of IT and business alignment is the end-user: If alignment is viewed as conformity to user expectations in terms of availability, performance, usability, and accuracy, then monitoring end-user performance is the only way IT knows that it is meeting these expectations."
When asked about the cost of poor application performance, 57 per cent of respondents stated increased costs to the business as a result; 48 per cent reported that poor performance resulted in lost revenue. The report stated this demonstrates a clear understanding of the potentially dramatic financial impact resulting from poorly managed IT service.
Other reasons given for financial impact to the business include negative impacts to external customer satisfaction (48 per cent) disruptions in production (42 per cent) and a negative impact on sales performance.
Join the CIO New Zealand group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.