Report

December 2002

CIOs: Build IT Transparency Through ABC

Bobby Cameron 		CIOs can't show IT's value alone. Instead they should create IT transparency using activity-based costing (ABC) techniques, associating business activities with specific IT resource utilization.
by Bobby Cameron with Tom Pohlmann, Christopher Mines, Meredith Child

MARKET OVERVIEW
  • One high-tech CIO has to reduce IT spend from 4.5% of revenue to 3% -- regardless of the business impact.
  • IT shows business execs the costs -- not the value.
ANALYSIS
  • Successful CIOs engage business leaders in measuring IT's value.
  • Activity-based costing links IT spending to the business.
ACTION
  • CIOs deliver detailed IT costs into tools business users already employ.
 
Figures & Data
  • Figure 1.  IT Uses Many Models To Represent Cost To The Business Unit
  • Figure 2.  Assigning IT Costs To Business Activity
   
RELATED MATERIAL 
  • Related Research
 
GRAPEVINE
  • Business cooperating with IT creates "a thing of beauty" as they share the heat.
  • You don't have to have the perfect metric -- just a consistent one.
  • Complex metrics don't necessarily mean value.

 

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Analyst: Bobby Cameron
Document Type: Report
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Original air date: Thursday, November 17, 2011
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Ratings and Comments
Rating: 7 out of 10
based on 1 ratings across all roles.
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