Value Measuring Methodology (VMM) - Revision history

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 == What is the Value Measuring Methodology (VMM)? ==
 Value Measuring Methodology (VMM) is a proven toolkit of existing techniques used to define, capture and measure both quantitative and qualitative value associated with information technology (IT) investments. It is based on public and private sector business and economic analysis theories and best practices. The VMM was first articulated in a report by Booz Allen Hamilton in 2002 for the US Social Security Administration, as part of an electronic services project. The purpose of Value Measuring Methodology is to define, capture and measure value associated with electronic services unaccounted for [[Return on Investment (ROI)|traditional return on investment (ROI) calculations]], to fully account for costs and to identify and consider risk.<ref>Defining Value Measuring Methodology (VMM) [http://airccse.org/journal/mvsc/papers/6215ijmvsc01.pdf Airccse]</ref>
 Value Measuring Methodology (VMM) is based on defining, capturing and measuring values associated with e-services which are not accounted in ROI. It is also focusing on costs and risks of a project. Therefore VMM is considered to be a hybrid methodology used by government bodies for development and steering of e-government initiatives. It is designed to monitor and help in choosing best alternative and decision making between different initiatives in the field of e-government projects. This methodology is analyzing and estimating values,risks and costs as well as evaluating them and calculating relationships among those elements.It is used to analyze projects on both enterprise and project level. As Mareva, it is focused on benefits that a project will have for citizens,business entities and government bodies. VMM has four main steps: first is to develop a decision framework which goal is to identify and define numerous elements like value and cost structure,risks, etc. Second step is based on alternative analysis. Third step puts that information together in way of aggregating costs, calculation of ROI and risks. Final step is the communication part of the methodology where main task is to present final results to stakeholders followed by implementation of best practices and creation of documentation for important elements.<ref>What is Value Measuring Methodology (VMM)? [http://www.academia.edu/1180761/Methodologies_for_Measuring_E-Government_Development_The_Croatian_Case Neven Vrček]</ref>

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 In summary, VMM provides a robust framework that ensures IT investments are technically viable and deliver tangible and intangible value to the organization. It bridges the often-seen gap between IT and business, ensuring that technology investments align with business objectives and deliver the desired outcomes.
-===See Also===
+Here are some best practices associated with the Value Measuring Methodology (VMM):
 #[[Return on Investment (ROI)]]
 #[[Total Cost of Ownership (TCO)]]
@@ Line 74: / Line 97: @@
-===References===
+== References ==
 <references />

@@ Line 62: / Line 62: @@
 #[[Return on Investment (ROI)]]
 #[[Total Cost of Ownership (TCO)]]
-#[[Benefit-Cost Ratio (BCR)]]
+#[[Benefit Cost Ratio (BCR)]]
-#[[IT Portfolio Management]]
+#[[IT Portfolio Management (ITPM)]]
-#[[Cost-Benefit Analysis]]
+#[[Cost Benefit Analysis]]
-#[[IT Investment Management]]
+#[[Information Technology Investment Management (ITIM)]]
 #[[Business Value]]
 #[[Project Management]]
-#[[Business Case Development]]
+#[[Business Case]]
 #[[Performance Metrics]]
 #[[IT Strategy (Information Technology Strategy)]]

← Older revision		Revision as of 15:17, 13 September 2023
Line 60:		Line 60:

	===See Also===		===See Also===
−	*[[IT Strategy (Information Technology Strategy)]]	+	#[[Return on Investment (ROI)]]
		+	#[[Total Cost of Ownership (TCO)]]
		+	#[[Benefit-Cost Ratio (BCR)]]
		+	#[[IT Portfolio Management]]
		+	#[[Cost-Benefit Analysis]]
		+	#[[IT Investment Management]]
		+	#[[Business Value]]
		+	#[[Project Management]]
		+	#[[Business Case Development]]
		+	#[[Performance Metrics]]
		+	#[[IT Strategy (Information Technology Strategy)]]

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 Value Measuring Methodology (VMM) is a proven toolkit of existing techniques used to define, capture and measure both quantitative and qualitative value associated with information technology (IT) investments. It is based on public and private sector business and economic analysis theories and best practices. The VMM was first articulated in a report by Booz Allen Hamilton in 2002 for the US Social Security Administration, as part of an electronic services project. The purpose of Value Measuring Methodology is to define, capture and measure value associated with electronic services unaccounted for [[Return on Investment (ROI)|traditional return on investment (ROI) calculations]], to fully account for costs and to identify and consider risk.<ref>Defining Value Measuring Methodology (VMM) [http://airccse.org/journal/mvsc/papers/6215ijmvsc01.pdf Airccse]</ref>
-Value Measuring Methodology (VMM) is based on defining, capturing and measuring values associated with e-services which are not accounted in ROI. It is also focusing on costs and risks of a project. Therefore VMM is considered to be a hybrid methodology used by government bodies for development and steering of e-government initiatives. It is designed to monitor and help in choosing best alternative and decision making between different initiatives in the field of e-government projects. This methodology is analyzing and estimating values,risks and costs as well as evaluating them and calculating relationships among those elements.It is used to analyze projects on both enterprise and project level. As Mareva, it is focused on benefits that a project will have for citizens,business entities and government bodies. VMM has four main steps: first is to develop a decision framework which goal is to identify and define numerous elements like value and cost structure,risks, etc. Second step is based on alternative analysis. Third step puts that information together in way of aggregating costs, calculation of ROI and risks. Final step is the communication part of the methodology where main task is to present final results to stakeholders followed by implementation of best practices and creation of documentation for important elements.<ref>What is Value Measuring Methodology (VMM)? [http://www.academia.edu/1180761/Methodologies_for_Measuring_E-Government_Development_The_Croatian_Case Neven Vrček]</ref>
+== Why is VMM important? ==
-'''Steps to Value Measuring Methodology''' <ref>Steps to Value Measuring Methodology [http://www.aguiareoliveira.com.br/gerenciador/uploads/governamentais_2a.pdf Aguiare Oliveira ]</ref><br />
+== Steps to Value Measuring Methodology <ref>Steps to Value Measuring Methodology [http://www.aguiareoliveira.com.br/gerenciador/uploads/governamentais_2a.pdf Aguiare Oliveira ]</ref> ==
 The Value Measuring Methodology is composed of four steps:<br />
 . '''Develop a Decision Framework'''- The cornerstone of VMM is the decision framework. Comprised of three structures - value, cost and risk - the framework provides decision makers with a blueprint for defining, analyzing and comparing alternatives. In addition, it ensures that decision makers will have the depth and granularity of information necessary to make and justify sound business decisions.<br />
@@ Line 13: / Line 40: @@
 Each step is necessary to ensure both qualitative and quantitative information is captured. Additionally, each step must be completed sequentially to ensure complete documentation and objectivity.

← Older revision		Revision as of 11:18, 23 December 2022
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−	Value Measuring Methodology (VMM) is a proven toolkit of existing techniques used to define, capture and measure both quantitative and qualitative value associated with information technology (IT) investments. It is based on public and private sector business and economic analysis theories and best practices. The VMM was first articulated in a report by Booz Allen Hamilton in 2002 for the US Social Security Administration, as part of an electronic services project. The purpose of Value Measuring Methodology is to define, capture and measure value associated with electronic services unaccounted for ~~traditional~~ [[Return on Investment (ROI)\|return on investment (ROI) calculations]], to fully account for costs and to identify and consider risk.<ref>Defining Value Measuring Methodology (VMM) [http://airccse.org/journal/mvsc/papers/6215ijmvsc01.pdf Airccse]</ref>	+	Value Measuring Methodology (VMM) is a proven toolkit of existing techniques used to define, capture and measure both quantitative and qualitative value associated with information technology (IT) investments. It is based on public and private sector business and economic analysis theories and best practices. The VMM was first articulated in a report by Booz Allen Hamilton in 2002 for the US Social Security Administration, as part of an electronic services project. The purpose of Value Measuring Methodology is to define, capture and measure value associated with electronic services unaccounted for [[Return on Investment (ROI)\|traditional return on investment (ROI) calculations]], to fully account for costs and to identify and consider risk.<ref>Defining Value Measuring Methodology (VMM) [http://airccse.org/journal/mvsc/papers/6215ijmvsc01.pdf Airccse]</ref>

← Older revision		Revision as of 11:17, 23 December 2022
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−	Value Measuring Methodology (VMM) is a proven toolkit of existing techniques used to define, capture and measure both quantitative and qualitative value associated with information technology (IT) investments. It is based on public and private sector business and economic analysis theories and best practices. The VMM was first articulated in a report by Booz Allen Hamilton in 2002 for the US Social Security Administration, as part of an electronic services project. The purpose of Value Measuring Methodology is to define, capture and measure value associated with electronic services unaccounted for traditional return on investment (ROI) calculations, to fully account for costs and to identify and consider risk.<ref>Defining Value Measuring Methodology (VMM) [http://airccse.org/journal/mvsc/papers/6215ijmvsc01.pdf Airccse]</ref>	+	Value Measuring Methodology (VMM) is a proven toolkit of existing techniques used to define, capture and measure both quantitative and qualitative value associated with information technology (IT) investments. It is based on public and private sector business and economic analysis theories and best practices. The VMM was first articulated in a report by Booz Allen Hamilton in 2002 for the US Social Security Administration, as part of an electronic services project. The purpose of Value Measuring Methodology is to define, capture and measure value associated with electronic services unaccounted for traditional [[Return on Investment (ROI)\|return on investment (ROI) calculations]], to fully account for costs and to identify and consider risk.<ref>Defining Value Measuring Methodology (VMM) [http://airccse.org/journal/mvsc/papers/6215ijmvsc01.pdf Airccse]</ref>

← Older revision		Revision as of 10:58, 23 December 2022
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	===See Also===		===See Also===
−	*[[~~MAREVA_Methodology\|MAREVA Methodology]]~~	+	*[[IT Strategy (Information Technology Strategy)]]
−	*[[WiBe_Framework\|WiBe Framework]]

@@ Line 1: / Line 1: @@
-[[Value]] Measuring [[Methodology]] (VMM) is a proven toolkit of existing techniques used to define, capture and measure both quantitative and qualitative value associated with information technology (IT) investments. It is based on public and private sector [[business]] and economic analysis theories and best practices. The VMM was first articulated in a report by Booz Allen Hamilton in 2002 for the US Social Security Administration, as part of an electronic services project. The purpose of Value Measuring Methodology is to define, capture and measure value associated with electronic services unaccounted for traditional return on investment (ROI) calculations, to fully account for costs and to identify and consider [[risk]].<ref>Defining Value Measuring Methodology (VMM) [http://airccse.org/journal/mvsc/papers/6215ijmvsc01.pdf Airccse]</ref>
+Value Measuring Methodology (VMM) is a proven toolkit of existing techniques used to define, capture and measure both quantitative and qualitative value associated with information technology (IT) investments. It is based on public and private sector business and economic analysis theories and best practices. The VMM was first articulated in a report by Booz Allen Hamilton in 2002 for the US Social Security Administration, as part of an electronic services project. The purpose of Value Measuring Methodology is to define, capture and measure value associated with electronic services unaccounted for traditional return on investment (ROI) calculations, to fully account for costs and to identify and consider risk.<ref>Defining Value Measuring Methodology (VMM) [http://airccse.org/journal/mvsc/papers/6215ijmvsc01.pdf Airccse]</ref>
-Value Measuring Methodology (VMM) is based on defining, capturing and measuring values associated with e-services which are not accounted in ROI. It is also focusing on costs and risks of a project. Therefore VMM is considered to be a hybrid methodology used by government bodies for development and steering of e-government initiatives. It is designed to monitor and help in choosing best alternative and decision making between different initiatives in the field of e-government projects. This methodology is analyzing and estimating values,risks and costs as well as evaluating them and calculating relationships among those elements.It is used to analyze projects on both enterprise and project level. As Mareva, it is focused on benefits that a project will have for citizens,business entities and government bodies. VMM has four main steps: first is to develop a decision [[framework]] which goal is to identify and define numerous elements like value and cost structure,risks, etc. Second step is based on alternative analysis. Third step puts that information together in way of aggregating costs, calculation of ROI and risks. Final step is the communication part of the methodology where main task is to present final results to stakeholders followed by implementation of best practices and creation of documentation for important elements.<ref>What is Value Measuring Methodology (VMM)? [http://www.academia.edu/1180761/Methodologies_for_Measuring_E-Government_Development_The_Croatian_Case Neven Vrček]</ref>
+Value Measuring Methodology (VMM) is based on defining, capturing and measuring values associated with e-services which are not accounted in ROI. It is also focusing on costs and risks of a project. Therefore VMM is considered to be a hybrid methodology used by government bodies for development and steering of e-government initiatives. It is designed to monitor and help in choosing best alternative and decision making between different initiatives in the field of e-government projects. This methodology is analyzing and estimating values,risks and costs as well as evaluating them and calculating relationships among those elements.It is used to analyze projects on both enterprise and project level. As Mareva, it is focused on benefits that a project will have for citizens,business entities and government bodies. VMM has four main steps: first is to develop a decision framework which goal is to identify and define numerous elements like value and cost structure,risks, etc. Second step is based on alternative analysis. Third step puts that information together in way of aggregating costs, calculation of ROI and risks. Final step is the communication part of the methodology where main task is to present final results to stakeholders followed by implementation of best practices and creation of documentation for important elements.<ref>What is Value Measuring Methodology (VMM)? [http://www.academia.edu/1180761/Methodologies_for_Measuring_E-Government_Development_The_Croatian_Case Neven Vrček]</ref>
 '''Steps to Value Measuring Methodology''' <ref>Steps to Value Measuring Methodology [http://www.aguiareoliveira.com.br/gerenciador/uploads/governamentais_2a.pdf Aguiare Oliveira ]</ref><br />
 The Value Measuring Methodology is composed of four steps:<br />
-. '''Develop a Decision Framework'''- The cornerstone of VMM is the decision framework. Comprised of three structures - value, cost and risk - the framework provides decision makers with a [[blueprint]] for defining, analyzing and comparing alternatives. In addition, it ensures that decision makers will have the depth and granularity of information necessary to make and justify sound business decisions.<br />
+. '''Develop a Decision Framework'''- The cornerstone of VMM is the decision framework. Comprised of three structures - value, cost and risk - the framework provides decision makers with a blueprint for defining, analyzing and comparing alternatives. In addition, it ensures that decision makers will have the depth and granularity of information necessary to make and justify sound business decisions.<br />
-. '''Define Alternatives''' - An alternatives analysis requires “thinking-through” possible ways in which an issue may be addressed, yielding the [[data]] required to not only justify an investment or course of action and support the completion of [[budget]] justification documentation, but also to provide an expected [[baseline]] of value, costs, and risks to guide the [[management]] and on-going [[evaluation]] of an investment. An alternatives analysis must consistently assess the value, cost, and risk associated with more than one alternative for a specific initiative, including the base case, within the specific parameters of the decision framework without stalling the planning processes in the quagmire of “analysis paralysis.” The estimation of cost and projection of value must, to the greatest extent possible, predict actual costs and value. This is accomplished in part by using ranges to define specific elements of cost and measures of performance, and then subjecting those ranges to an uncertainty analysis to develop a range of expected value. A sensitivity analysis identifies the variables that have a significant [[impact]] on this expected value. Although these analyses will increase confidence in the accuracy of an estimate of cost and prediction of performance, they do not consider how other factors may drive up expected costs or degrade predicted performance: to do so requires the performance of a risk analysis. <br />
+. '''Define Alternatives''' - An alternatives analysis requires “thinking-through” possible ways in which an issue may be addressed, yielding the data required to not only justify an investment or course of action and support the completion of budget justification documentation, but also to provide an expected baseline of value, costs, and risks to guide the management and on-going evaluation of an investment. An alternatives analysis must consistently assess the value, cost, and risk associated with more than one alternative for a specific initiative, including the base case, within the specific parameters of the decision framework without stalling the planning processes in the quagmire of “analysis paralysis.” The estimation of cost and projection of value must, to the greatest extent possible, predict actual costs and value. This is accomplished in part by using ranges to define specific elements of cost and measures of performance, and then subjecting those ranges to an uncertainty analysis to develop a range of expected value. A sensitivity analysis identifies the variables that have a significant impact on this expected value. Although these analyses will increase confidence in the accuracy of an estimate of cost and prediction of performance, they do not consider how other factors may drive up expected costs or degrade predicted performance: to do so requires the performance of a risk analysis. <br />
 . '''Analyze Alternatives''' - This step of VMM framework has five tasks: Aggregate the Cost Estimate; Calculate the Return-on-Investment; Calculate the Value Score; Calculate the Cost and Value Risk Scores; Compare Value, Risk and Cost<br />
 . '''Document and Communicate''' - The outputs of VMM may be used to communicate the overall value of an initiative to a variety of stakeholders. The analysis and planning required by VMM produce outputs that fully satisfy or strongly support many requirements for justifying budget requests.
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 ===See Also===
-[[MAREVA_Methodology|MAREVA Methodology]]<br />
+*[[MAREVA_Methodology|MAREVA Methodology]]
-[[WiBe_Framework|WiBe Framework]]
+*[[WiBe_Framework|WiBe Framework]]