IT cost transparency is a facet of IT cost optimization, providing insight into the existing IT cost baseline.
IT cost transparency helps ensure innovation and support for business growth are not compromised by continual downward pressure on IT budgets. IT departments that seek IT Cost Optimization are able to easily maintain total cost transparency in terms that can readily be understood by line-of-business executives. This cost transparency enables those same executives to participate in efforts to reduce IT costs by optimizing configurations, thereby freeing resources for innovation and M&A support.
To paraphrase a leading analyst group, “Transparency cannot be defined until IT and the organization agree on what IT provides the organization and what the organization needs from IT.”
Making IT costs transparent requires an understanding of not only what the organization needs from IT, but of the existing IT cost baseline. Signs that IT cost transparency is having a positive effect on the organization include better demand management, an improved ability to run IT like a business, and improved IT forecasting accuracy. With greater IT cost transparency, IT can shift the discussion from “lights-on” spending to funding more innovation.
Elements of IT Cost Transparency
IT Asset Baseline. By this, we mean the number of IT assets that are chargeable, their configuration, and how they are used. For maximum transparency the scope of this information must encompass workstations, mobile devices, servers, networking, storage, and software. Importantly the baseline must also reflect the interplay between these elements in order to support the next element: business system correlation.
Business System Correlation. Transparency requires being able to express facts in ways the recipient can understand and use. For example, if line-of-business executives fully understand their business systems and the value they provide, IT costs must be defined in similar “systems” terms, which might require grouping costs together for the various technical components that comprise a system.
Configuration Intelligence. For true IT cost transparency, it is not enough to make the baseline configuration of the IT estate more transparent. The relationship between configuration and the deployment of software must also be made transparent. For example, the movement of a database onto a server that is part of a cluster may well increase costs by an order of magnitude. Understanding the interplay of licensing, virtualization, and clustering is essential if “lights on” IT costs are to be driven down.
Usage Intelligence for Decommissioning. Usage is the final piece of the IT cost transparency puzzle. Many organizations have numerous servers, holding expensive licenses, supporting non-existent workloads. Being able to identify by whom and how each of the components of business systems are used is an essential aspect of IT cost transparency, in order to support decisions about decommissioning unnecessary hardware and software.
Providing reporting on the items above needn’t be a burden on IT asset management; it can be made almost effortless with new approaches to IT cost transparency. Once such new approach, Asset Vision from Scalable Software, provides robust, reliable reporting on IT assets—including dashboard views—that make it easier to get a more transparent view of IT costs.