In these innovative times, there is a constant push for people to be more creative and do more with less. This is especially true in the world of IT. In an article for Consultancy.uk, Nigel Hughes discusses how IT can shift their focus towards identifying the cost of consumed services and still support the business in making valuable decisions.
The problem that IT is facing currently in this value-based decision is that there is a lack of cost transparency for the delivery of IT services, according to Hughes. Presently, most organizations have a myriad of IT costs, but no one encompassing record of the spending. Additionally, the records that do exist lack the valuable insight of what IT services are actually consumed.
Technology business management (TBM) may be the answer to this problem. TBM is a framework that helps CIOs to better run their IT structure as an almost business. According to Hughes, “Having a clear view of IT systems allows decision-makers to define their needs more effectively, making it easier to manage business demand and sourcing delivery.” There are four benefits in implementing TBM:
- Managing demand for services
- Attaining savings goals
- Achieve better negotiations with vendors
- Identifying value
A cost transparency model helps to better understand the costs of service in their entirety. This helps IT to have a more accurate overview of what is going on in IT as a whole.
Identifying new opportunities for cost savings is highly important to CIOs. When services are monitored by automation, IT can keep up-to-date information on their cost information. This information can ultimately assist them to see if their unique endeavors help to differentiate them or drain them.
Having accurate cost data greatly helps in the negotiations with vendors. Knowing what the expenditures are allows for analysis against the market rate, which will help to make more powerful moves during the negotiations.
Lastly, achieving cost transparency greatly helps in the defining of costs of services. This information is crucial when making outsourcing decisions.
You can read the original article here: http://www.consultancy.uk/news/12091/technology-business-management-a-model-for-managing-it