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Understanding Business Value Assessment Criteria Key Elements

January 9, 2008

Criterion Explanation
IT customer pull Extent to which IT’s customers are asking for this deliverable-describe volume and strength and influence of the request or demand.
Firm strategic fit/impact Level of alignment with strategic objectives (SO)-describe which SOs and how impacted.
Firm end-user performance improvement User productivity, system performance, quality; not limited to only IT users.
New or enhanced capability Completely new solution to solve a business problem or an enhancement or incremental improvement?
Impact on firm’s business risk Improvement in firm’s business continuity, security, stability, and disaster recovery. (Total risk = severity of occurrence × frequency of occurrence.)
Level of innovation and learning for IT customers New technology approach/tool for customers.
Impact on key business variables Deliverable addresses one of the value dials from the list that is not covered by any criteria here -identify the specific value dials that are impacted.
Impact on firm’s revenue Directly related to protecting or enhancing the revenue generation environment, but not the magnitude of the impact.
End customer satisfaction and VOC Impact on IT customer satisfaction, i.e. the firm’s business units.
Size and level of customer impact (i.e., visibility) Magnitude of firm’s population affected.
Use of firm’s own products Extent to which project showcases use of the firm’s own products.
Confidence of success Degree of confidence, from a business standpoint, that the benefit will be delivered.
Other intangible benefits Please list additional benefits not captured above.

The list above provides a list of sample business value criteria. These criteria are all factors that influence the potential business value of an IT investment. If there is already significant demand or pull from senior executives in the business for an investment, it is likely that there will be both significant commitment and executive sponsorship for the investment (a very important success modulator for IT investments), and it is also likely that they have seen good alignment between the solution the investment could deliver and the business. Many businesses operate using strategic objectives that are reviewed on a periodic basis and provide the basis for making business decisions. If a potential IT investment is strongly aligned with the business’s strategic objectives, the investment is likely to generate business value

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