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A unique analytical service that provides an in-depth view of IT spend that enables better decision making
To effectively demonstrate how IT spending is aligned to specific business functions and needs is difficult for most organisations. This often leads to challenges in securing the right level of funding for IT and can obscure the value the IT function is delivering.
To properly understand and articulate where the money is being spent, it’s useful to look at how cost is viewed from different perspectives:
Hardware | Software | Personnel | Managed Services | Other
The Accounting View is essentially the IT budget for most organisations. It represents the total costs of IT and is usually broken down into its major elements. It provides sufficient detail for corporate budgeting purposes and is effective in setting the enterprise financial boundaries in which the IT organisation must operate.
End User Devices | Applications | Networks | Storage
IT organisations typically manage their spending by technology “tower”, giving an IT View of technology-related spending. This gives greater insight than the corporate Accounting View and also articulates the overall budget in a language that technologists and technology service providers use. One of the main benefits of the IT View is that it offers the opportunity to analyse technology spending at a granular technology level and, through the use of benchmarking, can drive down unit costs to market competitive rates.
Finance | HR | Sales & Marketing | Operations | Etc.
Taking the same costs as in the other two views and organising them by business function delivers the Consumer View. This view clearly illustrates which business functions are consuming IT services and the associated costs of delivering those IT services. The Consumer View allows business leadership to see where current IT expenditure is going and can facilitate strategic discussions on future areas of investment focus.
Within Transparency Advisory we offer a range of services that bring clarity to where the IT budget is really being spent. Being able to transparently illustrate how IT spending supports different business functions helps executive discussions and also provides a strong validation as to whether the IT investments are truly going to the areas that will deliver the most benefit.
By deploying our structured approach to analysing client data, combined with our mapping methodology and use of industry standard BI tools, we are able to create “consumer views” that detail the IT cost-to-serve for each business function. Our methodology allows us to structure the data in a way that enables BI tools to “drill down” into any selected business area.
The diagram on the right illustrates the Consumer View of IT using the example of a hospital:
Transparency Services structure the data in a way that offers the ability to “drill down” into different areas of the business and identify exactly where the IT budget is being spent:
Our Transparency services are designed to provide valuable insight to senior executives, and we are also able to offer market data feeds to facilitate comparative analysis. Our services in this area deliver not just a static report, but an ongoing service that offers an interactive data interrogation capability, empowering our clients to query their own data in uniquely insightful ways.
The IT Cost Transparency Service provides a global view of the client’s IT spend and includes all IT cost elements (hardware, software, people and services). Interactive analysis can be performed at the global, regional and country level.
The Requirement:
A large public sector organisation was under pressure to clearly show how its IT spend was supporting specific public services. Our client needed to move towards a “show-back” reporting of IT costs as part of delivering a greater insight of technology spend to senior stakeholders.
The Approach:
In the early phases of the engagement we worked with our client to identify and map key fields within their general ledger to our own chart of accounts (COA). Once complete, we then mapped the client’s assets and service elements to the same COA.
After mapping was completed and validated, a specific business area was chosen as a pilot. Using our detailed methodology and playbook we worked with the client to identify each IT element used by the pilot business function and then used that information to further enhance the data previously mapped. Initial design of Dashboards was also undertaken at this time.
ImprovIT processed the data through its Transparency toolset and produced a set of dashboards, reports and tables that were loaded into a cloud platform for the client to review and test.
After the pilot was approved, we were able to rapidly expand the service to the remaining business areas. Finally, peer data was inserted for comparison purposes and regular monthly feeds setup.
The Outcome:
The client now has an interactive service provided by ImprovIT that provides them with the ability to drill-down and interrogate their IT own costs as required. The service is updated monthly to provide an always current view of IT spend from a “consumer” viewpoint, and they also receive a regular data feed of IT spend market data allowing them to clearly understand how their spending compares to other similar organisations. This new ability to clearly show where the IT budget is being spent has moved the conversation from “we think IT costs too much” to one of “what level of investment in IT is appropriate for the services we need?”
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