Effort and cost
Creating scorecards that align to strategies | CSI policies | Return on Investment for CSI | Creating a Return on Investment | Establishing the Business Case | Example | Measuring benefits achieved | Business questions for CSI | Service Level Management | Goal for SLM |
CSI improvement activities can require a considerable amount of effort and money for larger-scale improvement projects to minimal time and effort for some incremental improvements. If the effort is going to be costly then the organization, both IT and the business has to ask is it worth it?
Let’s first look at the costs of implementing and operating a measurement framework with respect to IT service provision. Possible major cost topics are:
- Labour cost – Salaries of the organization’s staff who are involved in implementing the measurement framework or who spend effort on performing one of the activities in operating or maintaining the measurement framework; including costs associated with managing it. If (part of) IT is outsourced, the external provider costs should be included here too.
- Tooling cost – Purchase, licenses, installation and configuration (remember – no customization!), maintenance costs of hardware, software and other equipment specifically used for the measurement activities. Tools could be a cost on the provider which they will pass on back to you.
- Training cost – Cost of training and coaching staff in the use of measurement methods, techniques, tools and procedure s.
- Expertise cost – Payments to hired experts and consulting firms, typically for the planning, implementation and maintenance activities pertaining to the measurement framework. Also includes the out-of-pocket costs of acquiring information used in the measurement framework that is not in the possession of the organization itself such as benchmarking data.
When deciding whether the measurement framework is worth the effort, consider the amounts to spend on:
- Implementation of the measurement framework, initially and if it changes – In practice these types of costs can be reliably estimated and controlled by using a project-oriented approach.
- Operation – The level of costs associated with the operation of the measurement framework is largely fixed as a result of the way it is designed and equipped.
- Maintenance – The level of these types of costs depends mainly on the expected rate at which the measurement framework will require adaptation to changing circumstances and on the quality of its implementation.
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