Why Read This
In a recent Forrester survey of 84 enterprise IT decision-makers, only 52% said that they have a formal IT chargeback process in place. It is difficult to run IT like a business when the product appears to be free to customers but costs the business hundreds of millions of dollars to operate — which is precisely what happens when IT costs are not charged back to its customers. Instead, CIOs should embrace full cost transparency, which requires IT to operate like a service provider with a catalog of products and services aligned with its customers' needs, defined cost models for each service, an understanding of the demand drivers, and a process to track and invoice its customers based on their consumption of those services. Forrester has identified a number of best practices that leading organizations have used to make this transition to full cost transparency.
Tags: Business & IT Alignment, Chargeback, Cost Control, IT As A Business, IT Budgeting & Forecasting, IT Governance, IT Organization, Management & Organization, Organizational Structure, Shared Services, Strategy Planning & Governance, Tech Sector Economics