Defining Value in Information Centers

CLIS 724/Spring 2004

Carol Lynn Price

 

clmonner@charter.net

 


Defining Value in Information Centers

Under senior management directives, information professionals are slashing budgets, redefining their priority services and trying to demonstrate their value to the organization.  Management wants to know how much return they are getting for the money they are investing into the information center. Information Centers are facing many organizational challenges.  If they want to continue to exist, be successful and meet the challenges of the future, it will become essential for them to define value to the services they provide. 

How management measures value is unique to each organization.  Information Centers place value on their services as well as the skills and competencies of their staff.  The real problem is measuring their value so that management has a clear understanding of how the information center’s services impact the bottom line.

Joseph Matthews, author of The Bottom Line defines value by user criteria.  He believes that the individual who receives and uses the information defines value.  The value of the information delivered is further defined by the following factors:

1.      Ease of use

2.      Precision of search

3.      Quality

4.      Adaptability

5.      Timesavings

6.      Cost savings (Matthews)

 

How information professionals demonstrate value depends on an understanding of the organization’s overall goals and priorities.  A good indication of this is showing that the information center makes or saves money for the organization, or at least covers its cost.  Information professionals need to be proactive and innovative with their center’s development, and continually show how their products and services deliver value to the organization. (Konieczko) 

Measuring Value in Information Centers

Information Centers are using several systems of measurements to assess the value of their services.  The following information describes a few of these measurements.

Input Measures

 

Input measures are used to demonstrate performance.  They are easy to collect and report.  They indicate “how much” or “how many” and measure budgets, staffing, collection activities, online resources and the library space. 

Process Measures

 

Process measures are used to show how efficient operations are by measuring the time and cost of an activity or service and determining staff productivity.  Process measurements can be used to make comparisons with other information centers to see how efficiently they are operating and to begin to benchmark their value.

Output Measures

 

Output measures reveal how much the Information Center is being used.  These measures define satisfaction levels and service quality.  This data can help the center assess whether or not service levels are increasing or declining and what service is the most important.  Output measures quality, service, collection or resources, online resources and the other activities in the library.

            Although many information centers are using these measurements, Matthews indicates some problems with their use.  Input, process and output measures do not relate to the bottom line, and as a result, are not useful for measuring performance within the organization.  Information professionals become more concerned with individual tasks rather than evaluating the overall activities within the center.  His logic is that “doing things faster is not a good alternative to doing the right things.” (Matthews)

Return-on-Investment Measures

            Robert Strouse, an analyst for Outsell, Inc., a leading research firm, advises information professionals to apply metrics to services in order to justify budget allocation and measure value.  According to Strouse, the most accurate measurement of this is by collecting return on investment (ROI) data.  ROI data will determine if the information center’s services have produced any cost savings and how their users applied the services. 

            Strouse suggests that ROI data can be both quantitative and qualitative.  The quantitative measures report how they impact the bottom line. They may include time saved by library users that can be translated into salary dollars; money users save by using the library instead of another resource; and any revenue generated with the library’s assistance. (Strouse)  

Numbers alone though, do not tell the whole story on the value of library services.    A qualitative perspective of value can be defined by measuring the level of satisfaction experienced by the users of the center.  This includes how much users rely on the center for information, if the information is supporting any decision-making, and if the information supplied is important enough.  Qualitative information can also indicate whether the information center’s response was complete, delivered on time and better than anything that was available if the user had not had access to the information center. By combining both quantitative and qualitative data, management receives the bottom line data, but also a story or a narrative about the services and products they provided.

What the center measures depends on what management is looking for in order to judge value.  ROI data can be collected in a questionnaire that will ask users what benefits they have received from the information center.  Some of the benefits that can be investigated are:

  1. Did information by the center save the organization money in developmental costs or legal costs?
  2. Did it save employee time, translating this time to salary dollars?
  3. Did it increase any sale?
  4. Did it improve a manufacturing process and decrease manufacturing costs?
  5. Did it create any new sales? (Strouse)

Information centers using ROI can report this data to management in time saved, revenue generated and money saved.  Time saved might be calculated and reported in the following method:

 

“30% of the center’s users indicate having saved time about 20% of the time they used the center’s services.  The median number of hours saved is two.  The average reported hourly salary is about $50.00.  Two hours times 30 percent times 20% times $50.00 equals a $60.00 salary equivalent savings per library interaction.”

 

The information reported from ROI data can create an overall information center dollar value.  This information can make a “powerful bottom-line argument” for Information Centers.  The most difficult aspect of using ROI measurement is getting other departments to buy into the system and provide the relevant information to the center. (Strouse)

Balanced Scorecard

Another approach for measuring value recommended by Joseph Matthews is the Balanced Scorecard.  Kaplan & Norton first introduced this approach in an article published in the Harvard Business Review and presented as a method to identify measures that reflect future performances or potential performance. The concept of the scorecard is to identify measures that align organizational goals and objectives with that of the information center.  The scorecard is meant to be a series of indicators that informs the information professional on how the center is doing.  It is based on answering four questions and designing measures for each question.

  1. How do customers see the center? (Customer Perspective)   This question measures time, quality, performance and service and cost. 
  2. At what must the center excel? (Internal Perspective)   The internal perspective evaluates processes and competencies.

3.      Can the center continue to improve and create value? (Innovation and Learning Perspective)  This question measures any new services, technology improvements and the skills of the center staff.

  1. How does the library look to stakeholders? (Financial Perspective)  This perspective shows the financial impact of the center.

 

 

Matthews suggests that using the scorecard approach reveals a broad perspective of the center’s activities without isolating the measurement of one service. It is important in measuring value since it basically states that the information center’s overall activities cannot be measured by one service.  The balanced scorecard suggests that information specialists need to evaluate all four areas to gain a broad perspective on the performance measures of the center as a whole.

            There are some problems using the balanced scorecard.  Information professionals may find the system of measuring all services is too complicated and make it difficult to focus.  In addition, some of the measurements can be too subjective.

Conclusion

 

Many Information Specialists will indicate that they are undervalued.  The best response to this description is to develop and execute a plan that will demonstrate their value.  The services provided by information centers should fit in to the overall organization’s goals and focus.  Measuring value allows information professionals to evaluate their work and determine what they need to change to improve their organizational performance.  Information specialists need to create strategies for communicating their value for every product or service offered.  As Matthews states, if the center “is not making a contribution to the overall performance of the organization, it will not survive.” (Matthews) 


References

 

Konieczko, Jill with Cynthia Power.  “Information Centers That Innovate:  Six Librarians Provide Secrets to Success.”  Information Outlook 7, #1 (2003):  18 – 27.

 

Matthews, Joseph R.  “Determining and Communicating the Value of the Special Library.”  Information Outlook 7, no 3 (2003): 26-31.

 

Olson, Christine A.  “What’s In It for Them?  Communicating the Value of Information Services.”  Information Outlook 6, i.1 (2002): 18 (6).  Reproduced in Expanded Academic ASAP.  Database online.  Available from http://web-4.infotrac.galegroup.com/itw/infomark/.  Internet.  Accessed 8 March 2004

 

Silcox, Barbara P. and Paula Deutsch.  “The Customer Speaks:  Assessing the User’s View.  Information Outlook 7, no 5 (2003):  36-41.

 

Strouse, Roger.  “Demonstrating Value and Return on Investment:  The Ongoing Imperative.”  Information Outlook 7, i.3 (2003): 14(6). 

 

Strouse, Roger.  “Corporate Information Centers in the Year of Accountability.”  Online 25, 4 (2001): 86 (3).  Reproduced on: Ebscohost.http://web8.epnet.com.  Internet.  Accessed 3 March 2004.