eBay Changes IT with a Metric
IT managers facing the task of explaining the business value of IT to the C-suite don't necessarily have an easy time of it. But eBay believes it has fixed this problem with a metric that translates IT resources into key business metrics.
Tue, December 10, 2013
Computerworld — LAS VEGAS -- IT managers facing the task of explaining the business value of IT to the C-suite don't necessarily have an easy time of it.
But eBay believes it has fixed this problem with a metric that translates IT resources into key business measurements: Cost, performance, environmental impact and revenue.
It does this by measuring URL transactions per kilowatt hour (kWh). A transaction is a URL request, and eBay did more than 4.3 trillion transactions in 2012. It assembles the information in a dashboard.
The metric, according to Dean Nelson, vice president of Global Foundation Services at eBay, allows its top executives to see how productive the "engine," or data center is in delivering services. The e-commerce and online auction company has some 55,500 servers.
But will this metric work for everyone?
Nelson was on the stage here at the Gartner Data Center Conference, answering questions about eBay's approach and explaining the logic and benefits of the measure.
"I don't think it's a perfect fit for anybody else," said Joe Walsh, an attendee and an IT manager at medical component distributor. He said eBay's metric only really works for eBay and similar companies.
"EBay itself only sells transaction capabilities, so seeing how they measure it that way seems pretty logical," Walsh said. Amazon might be a close model, "but Amazon sells physical products; eBay just sells capacity," he said.
But Robert Logbeck, the infrastructure operations manager at Dickinson Financial Corp., in Kansas City, Mo., said his company has also been looking for ways to show IT efficiencies to directors, "and I think that might be something we might apply."
Similar to eBay, "we're in the transactional business," Logbeck said. In banking, it's all about customer transactions, whether online or in front of a teller, he said.
EBay's metric gave its executives insights, but also changed how IT works, Nelson said.
Nelson explained that the metric help to turn a discussion in IT to the business value, and projects were assessed by how much they would help improve the transactions per kWh metric. It also helped the vendors understand what eBay was trying to achieve: Fewer servers running at greater efficiency or more transactions per server.
"The staff started thinking a little differently about their projects," said Nelson, as a result of the metric.
Patrick Thibodeau covers cloud computing and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at @DCgov or subscribe to Patrick's RSS feed. His e-mail address is email@example.com.
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