Although it is not a saying you hear much anymore, success in school used to be qualified by making sure you understood and were proficient at the three Rs -- "readin', ritin', and rithmatic." And while it isn’t politically correct to reference them in that way today, the individuals who spouted that phrase were actually on to something -- particularly when it comes to IT management.
You are probably saying "Huh?" right about now, so let me explain. Just like in school, when it comes to IT management, the first 2 Rs are about communication. I have written often on the importance of communicating well and often with all those who are consumers of your services. So I won’t beat a dead horse on this issue (although I am sure I will come back to it again in the future -- it’s that critical).
However, neglecting the third R -- 'rithmatic -- is what can get you into real trouble. In terms of IT management, that third R means budgeting and knowing the numbers for your operations inside and out. This can make or break you as an IT management professional.
Once upon a time, IT was mysterious and magical -- the proverbial black box. Flawlessly running operations with little or no downtime was both an art and a science. And as long as you did just that, most people were pretty satisfied with your performance.
Times have changed, however, and people (your customers and management) have come to expect IT services to be just like a utility -- always on. Of course, the difference between your IT department and a utility is that you are not a monopoly; there are not a million suppliers of electricity and water out there knocking on doors and offering to sell them cheaper and with the same level of service – but there are for IT services. There is always someone telling your management that they can provide the same services as you better and cheaper.
To make matters worse, your customer’s budgets are getting squeezed ever so tightly and -- guess what? -- you are just an expense, my friend. No matter that you provide the best service possible -- it’s just business, and Frank here says he can do better than you.
So…with that set of expectations, you had better be good at 'rithmatic. What does that mean? Management expects three things from your numbers concerning your operations: transparency, clarity, and consistency. They want to be able to see how you arrive at your numbers, they want to understand the methodology you used to arrive at those figures, and they want your numbers to be consistent over time -- meaning that you are not constantly changing your methodology and accounting practices.
Management may not always agree with you on how you arrive at your numbers, nor your methodology for calculating costs -- but those are things that can be argued and defended.
What gets you into hot water is when your numbers don’t meet the TCC test (transparency, clarity, consistency). Failing the TCC test creates doubt -- doubt in your ability to manage the operations, in what you are charging them, and doubt regarding whether there is any dishonesty involved. If people think your figures are fishy, you have a problem.
So what does all this mean to a typical IT organization? That bookkeeping and performance metrics are critical to your operation -- not from the standpoint of how well your operation performs (although they play a part), but in how your operation is funded, and, just as importantly, how your own performance is judged.
So as a manager, what does this mean for you? If this is a weakness of yours, you need to get up to speed or find people to help you who are well-versed in budgeting and accountability -- preferably both.
What you should not do is bury your head in the sand or be too "busy" running the operation to take care of these things because, buddy, not knowing your third R will come back to bite you and HARD!
Here are a few resources to give you a start while you scour the Internet, your peers, and mentors for help.