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Better Decision Making by Understanding IT Spend

Better Decision Making by Understanding IT Spend. From WAG to Perception!!! Danny Bramman Head of Corporate Services - ULCC. ULCC Costing Information – The Why. Established 1968 as a ‘Super Computer’ Centre for HE one of three in the UK

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Better Decision Making by Understanding IT Spend

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  1. Better Decision Making by Understanding IT Spend From WAG to Perception!!! Danny Bramman Head of Corporate Services - ULCC

  2. ULCC Costing Information – The Why • Established 1968 as a ‘Super Computer’ Centre for HE one of three in the UK • Continually re-invented ourselves over the next 40 years • In 2005 we had 2 large contracts and had started looking after UoL IT needs • And then………………

  3. ULCC why we started to dig 2 • 40% of our revenue was insourced back to JANET • So were some of our costs (TUPE) • Lack of useful data • No up to date financial information • No basis to make effective decisions • At the time UoL had an old finance system

  4. The Challenges • No useful financial information • No understanding of ‘Cost’ and ‘Price’ • No timecard information • Costs allocated to whatever department could afford it • Functional Silos – poor communication • We needed good information

  5. How • ‘Sell’ the need for change • Collect data • Model activities with technical staff • Model the costs of each activity • Test the models • Continuously improve the models • Use DCF techniques for investment appraisal

  6. Key elements of the cost models • Staff Costs • Equipment costs • Depreciation (what is the useful life) • Maintenance (hardware & software) • Space Costs • Data Centre Costs • Power Costs • Overheads • The cost of money • VAT impact

  7. The Finance Link • Comprehensive coding system • Appropriate granularity • Careful coding of items (PO, Invoices) • Not too much off-system work • Monthly Accounts • Regular review with finance

  8. Staff Costs – how and what do you recover • Salary, Employers N I & Pension Costs • Training • Overheads (at ULCC c£150 per day) • Days available for recovery • Don’t forget • Holidays (including University closure & BH) • Sickness • Training & Administration

  9. Labour Costs

  10. Data Centre Costing • Space Costs • Power Costs (know your PUE) • Standby generator? • Equipment Costs • Cabinets • Cooling • Power Management & Monitoring • DCIM • Networking

  11. Cost of a rack in the DC

  12. Service Costing things to remember

  13. Starting on your journey • Everyone is a customer • Sell the process internally • Time recording is essential • Know your data centre costs & performance • Appropriate granularity • Work with finance • Continuous improvement of models • Don’t be afraid to fail (at first)

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