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Measurement 1

“Before we measure something we must ask whether we understand what it is we are trying

to measure.” (Gray et al, 2015)

In their book, Gray and her friends have argued that “before we measure something

we must ask whether we understand what it is we are trying to measure.” The authors use the

argument to stress on the importance to vividly understand the particulars of the specific

item, object or subject being measured. When evaluated on a lesser scale, the statement could

be used to mean that individuals are at times unsure of what they are measuring. In principle,

measurement is critical component when it comes to verifying, evaluating or reviewing the

outcome and performance of a given system, process or activity. In information technology,

measurement can for instance be used as a tool for evaluating feedback, hence an essential

ingredient for sustenance and growth (Wheatley & Kellner-Rogers, 1999).

Today, measurement forms an essential component in organizational management

(Wheatley & Kellner-Rogers, 1999), with successful managers using measurable tools in

maintaining competitive edge (Turner & Minonne, 2010). An IT company, say, Microsoft

can employ various measurements to evaluate progress, sales level as well as the level of

financial success. These are few, but common items that organizations might endeavor

measuring. In this paper, the focus is given to the application of measuring techniques in

information technology firms as part of their managerial tools.

Knowledge management/Environment

Information has for decades been argued as a key driver of both institutional and

individuals, and so defines how each party conduct themselves. Contextualized institutional

knowledge gaps should thereby be determined and their expected outcome defines forehand

in order to facilitate closure of any knowledge gaps (Lewis, 2017). In an IT firm, this may

take the form of institutionalized information systems and various procedures of practice put
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in place to establish an environment in which knowledge sharing and transfer can effectively

take place. It is common for IT firms to undertake research projects, whose outcomes have a

considerable bearing on the overall performance of other internal departments, and whose

divulgence to third-parties potentially increases the chances of the venture competing

unfavorably. In other instances, such institutionalizes knowledge includes business secrets

such as operational strategies that keep the business afloat (Sauro, 2014). These pieces of

information should be handled in highly secure environments as they relate to the firm’s core

operations, and can potentially derail the opportunities available to the venture.

Knowledge management is often considered a crucial element in the composition of

organizations. It is in this respect that Lewis (2015) views it as the “application of

information, collected and used to demonstrate effectiveness against a set of criteria” (p. 1).

Contextually, this wholistic view of knowledge management in an institutional setting gives

rise to the need for institutions to employ various techniques in collecting the information and

setting measures to ensure effective safeguarding of information and other forms of internal

data from unauthorized access and use. At a larger breadth, the scope of knowledge

management is often viewed to include techniques used in managing the flow and use of

information such as holders of specific institutional information to how sensitive information

is handled, stored and used within an institutional setting.

Communities of practice/interest

Among the recent developments in various groups and communities of interest is the

development of professional bodies to which various IT professionals belong. Such bodies

include professional coders, software developers, IT technical personnel bodies or groups of

common interest. In hardware and networking for instance, Microsoft’s professional courses

and those affiliated to Cisco and other professional groups are essential in ensuring integrity
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of their members. As a consequence, it is important for an IT firm to keep and maintain

contact with such professional bodies as it helps the firm in leveraging on the available

professional expertise.

At particular times, IT firms might be involved in managing special interest groups

and communities whose operations are mutually beneficial. The primary purpose of

maintaining such relations is to ensure that the firm and the group members benefit from the

activities undertaken by either of them. In a classical example, an IT firm might have

interests in researching about a given product or process, whose outcomes can be best

achieved through a group setting. In effect, the firm should consider building such groups

through which institutional goals including dissemination of ideas and information sharing as

well as fostering knowledge transfer through practice and teaching can be effectively

achieved. The management of these groups is often complex, and involving, and so the firm

should always remain committed to its course.

To distinguish the communities of practice from other communities of interest, Von

Wartburg, Rost and Teichert (2015) note that communities of practice are special purpose

groups with relevant and predetermined activities, especially, those relating to a given field of

practice. This can for training purposes, coaching or supervision, and are often formed to

undertake formal tasks. Common measurements in such groups take the form of

examinations, general evaluations and other forms of professional evaluation. Non-practice

community groups of interest on the other hand include those groups formed with no formal

mandate in mind. Measuring performance in such groups is often less restrictive, more

relaxed and often, less involving. Common items of evaluation include such aspects as

attendance, personal commitment and other informal factors that the members may mutually

agree on.
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The challenge of performance measurement

The evolution of technology, changes in institutional performance metrics and the

non-satiation nature of human needs have over time led to the change in how institutions

measure performance. In perhaps what Bititci, Garengo and Nudurupati (2011) projected

over eight years ago, recent developments in technology have expanded the scope, gaps and

the views on how we measure and manage performance today. In the expanded view, Bititci

and her colleagues proposed the use of a holistic approach that recognizes the level of

integration required in managing the arising challenges concurrently.

In the view of the performance measurement issue at institutional level, Phusavat,

Anussornnitisarn, Helo and Dwight (2009) seem to agree with Bititci et al (2011) that modern

performance measurement techniques ought to match the challenge of institutional

inefficiencies. On one front, this should encompass deploying performance measurement as

an integral part of management tools accessible to firms (Phusavat et al., 2009). On the other

front, there is need to instill responsibility on the management as part of ensuring effective

performance management at various levels. In practice, matching these factors is likely to

result to serious managerial challenges, especially when not properly managed (Goshu &

Kitaw, 2017).

A key consideration in designing corporate procedures of practice for IT firms is that

the information required in effective performance measurement is both scarce in a usable

state or too costly to obtain. In a divergent view of the informational dimension in

performance measurement, Coste, A-I and Tudor (2013) elude that and such institutions have

to decide how much, the nature and type of information worth gathering for their internal

consumes. In the digital error, the scope of the information available to such firms is diverse,

massive and at times contradicting (Phusavat et al., 2009). All these compounded make
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acquiring the much needed information complex and unimaginably expensive for firms,

especially, those at the formative stages of growth.

A superficial look into institutional performance measurement may seem

straightforward. In principle, measuring performance at an institutional level is rather

complex and often, resource involving. In an IT firm dealing with software, it is for example

easy to quantify the sales in terms of the number of new purchases, number of lost sales,

profits made per sale and the like. All these aspects are however, superficial, as they do not

necessarily reflect how well the organization is performing. In reality, such measurements

can only be effective if used in conjunction with other informational considerations such as

labor charges per unit of time, the amount of time taken in developing a given software

application, the level of government taxation and the expected level of profitability

anticipated per unit sale.

Institutional performance analysis in the corporate sector is an essential component of

real importance in defining how decisions are made and executed as well as facilitating long-

term planning. As a practice for firms seeking to expand, diversify or undertake new projects,

it is common for these firms to seek financing from third parties or finance the projects

internally (Nakamura & Warburton, 2008). As a principle of operation, ought financing to be

driven by both necessity and ability of the firm to meet its present and future financial

obligations. This requirement means that the firms should focus on mot just their

performance levels, but also on their speculative outcome. As a rule, the firm should consider

all the available information in defining the expected performance levels, with any deviations

from the projected levels of performance being treated with uttermost objectivity. Confronted

with the challenge of financing its operational activities, Wagner (2008) advises that the firms

should focus on ensuring sustainable levels of performance. When achieved, sustainable

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performance ensures that the firm’s output is optimized while its operational costs are at their

least possible levels.

While performance management is a critical component of effective institutional

management, Demirbag, Tatoglu, Tekinus and Zaim (2006) in Al Matari et al (2014) observe

that the underlying process improvement is impossible without measuring the outcomes. As a

consequence, performance measurement should never be viewed as a stand-alone metric, but

rather a set of ideals of evaluation. In the expanded view, performance measurement should

instead be seen as part of an integral process of evaluating an action’s efficiency and ability

to meet the desired outcomes effectively.

Intellectual capital and social networks

The management of intellectual property rights is an important aspect of today’s

business, especially where original inventors wish to retain originality of their inventions for

economic benefit. In the technology era today, there is need for inventors to protect their

intellectual capital from infringement and possible unauthorized use and abuse by third

parties (Dumitriu & Leovaridis, no date). In a information technology firm, such intellectual

capital includes things such as inventions, new software releases, new products and

distinguished research outcomes. Similarly, firms should commit to investing in safeguarding

their intellectual rights as much as they invest in research and development of their products.

By so doing, the firms are able to benefit from their inventions for longer (Dumitriu &

Leovaridis, no date) as a way of complementing their performance metrics (Turner &

Minonne, 2010).

The phenomenon correlation between social networks and institution’s intellectual

capital’s is firmly tied to how the institution treats its intellectual property rights. As

Falkowski (2014) notes in his work, Social Media’s Role in Intellectual Capital’s Growth,
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managing intellectual capital in the present era where people are highly networked socially is

both complex and capital intensive. The ubiquitous use of social media is for instance a key

threat to the very intellectual threat that much be holistically guarded with all might. Instead,

the social media is now for example a global threat to intellectual capital and anyone can use

it to either violate the intellectual rights of another party.

To vilify the unhealthy relationship between intellectual capital and social networks,

Stewart (1991) in Falkowski (2014) argues that despite the present information age and

knowledge economy being highly advanced, advances in the very technology becomes a

threat to the existence of the very inventions that should be otherwise protected. In principle,

modern societies build their wealth from the fundamental existence of unique formulations,

innovations and research outcomes that legally and economically give them a competitive

edge over their peers. This in essence means anything that threatens the intellectual rights of

original innovators, say large firms, threaten their very existence. Facebook, a recent

technology company to rise above the tech companies of the 1990s for instance has over the

years sailed on the intellectual rights of the original founders. As more and more firms find

ways of competing the firm, its existence, profitability and possibly, the very initial

deliverable is competed away. To retain the lead position, the firms in this era of high social

networks should always remain at the top in their innovation without showing any form of

leniency to things that threaten their intellectual capital, otherwise, such firms risk getting out

of business (Dumitriu & Leovaridis, no date).


In the light of the observations made in the preceding sections of the paper, it is worth

noting that the outcomes of a given process should always be weighed against the initially set

of anticipated outcomes. In principle, this entails measuring at different levels and stages, and
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should at times entail weighing the outcomes against the input levels. As a result, it can be

argued that the process, the stages, and the resources determine the possible outcome of a

given measuring activity. When completed, this process should yield outcomes that can be

traced back through the process to the initial ingredients or constituent components. It is

therefore, worth noting that before we something is measured, one must ask whether he

understands what it is we are trying to measure or not, otherwise, any outcome will still meet

the evaluation criteria.

From understanding whatever is being measured, there is additional need for the

person or persons undertaking the process to understand the right procedures of practice. This

helps in achieving optimal results that precisely match the measuring objective. Key

considerations to make in such cases relate to the specific measurements being done, the

instruments used, the process as well as its reliability and validity in delivering optimal

Measurement 9

Reference List

Al-Matari, E. M., Al-Swidi, A. K., Bt Fadzil, F. H. (2013). The measurements of firm

performance’s dimensions. Asian Journal of Finance & Accounting, vol. 6, no. 1, pp. 24-49.

Bititci, U., Garengo, P., & Nudurupati, S. (2011). Performance measurement: Challenges for
tomorrow. International Journal of Management reviews, vol. 14, no. 3, pp. 305-327.

Coste, A-I., & Tudor, A. T. (2013). Service performance – between measurement and
information in the public sector. Procedia – Social and Behavioral Sciences, vol. 92, no.
2013, pp. 215-219.

Dumitriu, E. V., & Leovaridis, A. A. (no date). Networking intellectual capital towards
competitiveness: An insight into the European Higher Education Institutions. The Electronic
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Falkowski., M. (2014). Social media’s role in intellectual capital’s growth. Review of

Business and Economics Studies, vol. 2, no. 2, pp. 66-74.

Goshu, Y. Y., & Kitaw, D. (2017). Performance measurement and its recent challenge.
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Lewis, J. M. (2017). The politics and consequences of performance measurement. Policy and
Society, vol. 34, no. 1, pp. 1-12.

Nakamura, A. O., & Warburton, W. P. (1998). Performance measurement in the public

sector. Canadian Business Economics, pp. 37-49.

Phusavat, K., Anussornnitisarn, P., Helo, P., & Dwight, R. (2009). Performance
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Sauro, J. (2014). 5 Questions to answer before measuring anything. [Online], Measuring u.

Available from:[Accessed 3rd May 2018].

Turner, G., & Minonne, C. (2010). Measuring the effects of knowledge management
practices. Electronic Journal of Knowledge Management, vol. 8, no. 1, pp. 161-170.

Von Wartburg, I., Rost, K., & Teichert, T. (2015). The creation of social and intellectual
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Wagner, J. (2008). Measuring performance – Conceptual framework questions. European

Financial and Accounting Journal, [Online] vol. 3, no. 3, pp. 23-43.

Wheatley, M., & Kellner-Rogers, M. (1999). Why do we measure and why? Questions about
the uses of measurement journal for strategic performance measurement.