Transcript Document

Meter iT - Optimize iT
Metering IT Assets:
Chargeback/Showback 101
Linda Cole
Director of Sales, Americas
Speaker
Copyright © 2015 Open iT, Inc. All rights reserved.
Eistein Fosli
Founder
Speaker
Today’s Agenda
• Industry Trends and Economic Backdrop
• IT Chargeback Goals
• Implementing IT Chargeback
– The process
– Customer Cases
• Benefits of IT Chargeback
Copyright © 2015 Open iT, Inc. All rights reserved.
Industry Trends and Economic Backdrop
43%
Software
of organizations increase their risk of falling
out of compliance
because of
not having
licensing
is complicated
enough
in its
sufficient process and automation in place
to manage their licenses.
Source: International Data Corporation (IDC)
Copyright © 2015 Open iT, Inc. All rights reserved.
own right.
Do you have an IT chargeback system in place?
IT“Internal
Chargeback:
internal
customers Bill
can look
at whatusers, groups, and
they pay for: servers,
time,
departments
for compute
use of software
and other IT resources
storage, etc., and compare it to what
based
oncharges.
actualItusage.
Amazon
puts IT in an
uncomfortable position.”
Source: Julio Gomez, co-founder of Innovation Counsils LLC.i
“The bill of IT for each entity is
valuable.”
Source: Debe Gash, CIO of St. Luke’s Health System
Copyright © 2015 Open iT, Inc. All rights reserved.
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Key Chargeback Functions
•
•
•
•
•
Data collection functions
Account table maintenance
Rate setting
Billing & reporting
Administrative functions such as:
– Budgeting activities
– Pricing decisions
– Usage variance analysis requests
– Business general ledger & accounting
– Cost allocation decisions
– Capacity & usage trending activities
Copyright © 2015 Open iT, Inc. All rights reserved.
Avoiding Situations Like This
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IT Chargeback Goals
Considered fair by most business users
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1
IT Chargeback Goals
Easy for IT to communicate
the IT costs with the business
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1
IT Chargeback Goals
Easy for IT to manage,
control and verify
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1
IT Chargeback Goals
Encourages optimized IT resource usage
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Implementing IT Chargeback
IT Chargeback Process
1. Target
2. Define
3. Test
4. Deploy
Corporate Policies and Procedures
GOAL: Transition from a cost center to a value center
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The Cost Centers
Chargeback process
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Companies/
Legal Ent
Projects
Departments
Cost Centers
Software
Staff
Network
Servers
Facility
Cost Generators
Increase Assets Efficiency
CUSTOMER CASES
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Customer Sample: Reduce Cost
REDUCED STORAGE WASTE
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Customer Case 1
Exponential Increase in Storage Cost
Storage cost increase
4
3.5
• Although storage units cost less
each year, a customer had an
exponential increase in their
storage cost.
(Year 1, storage cost was 1.14 MUSD, Year 2, it
was 1.85 MUSD, and Year 3 it had grown to 3.57
MUSD. I.e. storage cost tripled while storage
volume increased more than x 8!)
3
2.5
2
Storage cost
1.5
1
0.5
0
Year 1
Copyright © 2015 Open iT, Inc. All rights reserved.
Year2
Year3
• Even though storage is cheap,
managing the service is not.
• The company needed to change
the “laissez faire” attitude
towards storing and keeping data,
and make sure employees
cleaned up data no longer in use.
Customer Case 1
Exponential Increase in Storage Cost
Storage cost increase
4
3.5
3
2.5
2
Storage cost
1.5
1
0.5
0
Year 1
Copyright © 2015 Open iT, Inc. All rights reserved.
Year2
Year3
• Solution:
By mapping actual usage to
projects, it is easy to charge
projects for their storage usage.
This is a strong incentive for
project owners to make sure
projects are cleaned up upon
completion.
Support Business Process Improvement:
DOCUMENT SOFTWARE NOT IN USE
Copyright © 2015 Open iT, Inc. All rights reserved.
Statoil
Document Software not in use...
• Usage reporting to support a remix of licenses or to reveal training
needs
Site
Applications
CNTRASSIST
DATALOAD
Bergen
Caracas
Active
Active
Distinct
time
time
0.00
Copenhagen
Distinct
Active
time
Distinct
Harstad
London
Active
Active
Distinct
Distinct
time
time
0.00
0.00
0.00
0.00
0.00
76.92
6.00
0.00
0.00
516.17 14.00
11.17
3.00
44.57
4.00
749.25
18.00
431.93
5.00
Stavanger
Active
time
Distinct
0.12
3.00
10929.83 96.00
DSPACE
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
63.21
5.00
DSS
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
606.71
36.00
DT3DV
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
7.71
3.00
DTEXPLORER
0.00
0.00
0.00
0.00
2.75
1.00
562.75
2.00
3.93
2.00
2196.58
17.00
DTEXPRESS
0.42
1.00
2.42
1.00
0.00
0.00
555.50
3.00
58.25
4.00
551.62
14.00
DTGUI
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
7.71
3.00
DTINTERPRETER
0.00
0.00
0.00
0.00
0.00
0.00
24.92
2.00
0.00
0.00
12.08
3.00
EARTHCUBE
0.00
0.00
0.00
0.00
0.00
0.00
490.42
17.00
278.82
8.00
3245.92
34.00
FMP
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
1094.62
6.00
FSTTRK
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
10.24
1.00
0.00
0.00
FZAP
0.04
1.00
0.00
0.00
0.00
0.00
7.92
2.00
0.00
0.00
0.04
1.00
LGCIO
0.00
0.00
0.00
0.00
2.08
1.00
204.00
3.00
0.00
0.00
95.71
12.00
Copyright © 2015 Open iT, Inc. All rights reserved.
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8
Statoil
Action Item:
More Training or Cut in Maintenance?
• Why is the product ”DSPACE” only being used in Stavanger?
Site
Bergen
Feature
Active
time
CNTRASSIST
0.00
0.00
DATALOAD
516.17
DSPACE
Caracas
Copenhagen
Harstad
London
Stavanger
Distinct
Active
time
Distinct
Active
time
Distinct
Active
time
Distinct
Active time
Distinct
0.00
0.00
0.00
0.00
76.92
6.00
0.00
0.00
0.12
3.00
14.00
11.17
3.00
44.57
4.00
749.25
18.00
431.93
5.00
10929.83
96.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
63.21
5.00
DSS
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
606.71
36.00
DT3DV
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
7.71
3.00
DTEXPLORER
0.00
0.00
0.00
0.00
2.75
1.00
562.75
2.00
3.93
2.00
2196.58
17.00
DTEXPRESS
0.42
1.00
2.42
1.00
0.00
0.00
555.50
3.00
58.25
4.00
551.62
14.00
DTGUI
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
7.71
3.00
DTINTERPRETER
0.00
0.00
0.00
0.00
0.00
0.00
24.92
2.00
0.00
0.00
12.08
3.00
EARTHCUBE
0.00
0.00
0.00
0.00
0.00
0.00
490.42
17.00
278.82
8.00
3245.92
34.00
FMP
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
1094.62
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Distinct Active time
1
9
6.00
Reduce Risk:
NEGOTIATE A DIFFERENT SOFTWARE
AGREEMENT
Copyright © 2015 Open iT, Inc. All rights reserved.
Statoil/Halliburton
Once upon a time…
Maximum Concurrent Users Agreements
•
Took advantage of different license agreements by selecting agreements that best fit
usage patterns:
Duration (h)
Usage Distribution
240
210
180
150
120
90
60
30
0
97
91
85
79
73
67
61
55
49
43
37
31
25
19
13
7
1
OW
Used Licenses/ Feature
–
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Changing from max number of concurrent licenses to enterprise agreement based on average
maximum concurrent users
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Statoil/Halliburton
Once upon a time…
Maximum Concurrent Users Agreements
•
Took advantage of different license agreements by selecting agreements that best fit
usage patterns:
Duration (min)
Usage Distribution
300
200
OW
100
0
81
83
–
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85
87
89
91
93
95
Used Licenses/ Feature
97
99
Changing from max number of concurrent licenses to enterprise agreement based on average
maximum concurrent users
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22
Statoil/Halliburton
New Enterprise Agreement based on daily maximums
at each site
Daily Max Licenses Usage of OW
Max Used Licenses
70
60
Site9
50
Site 8
Site 7
40
Site 6
30
Site 5
Site 4
20
Site 3
O
Site
1
p
10
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19-May
18-May
17-May
16-May
15-May
14-May
13-May
12-May
11-May
10-May
9-May
8-May
7-May
6-May
5-May
4-May
3-May
2-May
1-May
0
e
n
i
T
,
I
n
c
.
A
ll
r
i
Increase Assets Efficiency
CHARGING MORE AT PEAK HOURS
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Version 6.2.1
License Efficiency Chart
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License Efficiency Chart
8
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Use Heat Map to Determine Prime Time
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Cut Cost
GET RID OF DORMANT USERS
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Following Up Named-User Agreements
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9
Following up Named-User Agreements
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0
Sad Stories
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Sad Story
“A user of the software using it for 8 hours on Sunday
afternoon pays the same as a user utilizing 8 licenses
for one hour during peak time.”
Which units/measurements are needed?
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32
Sad Story
“During one month, there is only one user of an
application. This user has used the application for 20
minutes only, but will have to carry all costs related
to that application for the full month.”
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33
Optimize Resource Usage
• Determine the best allocation model to avoid counter-productive
behavior. Example from “Customer A”. “Customer A” has a prior
chargeback system in place, based on elapsed time only, which means
leaving software on can be expensive for an end-user. This may encourage
some counter-productive behaviors, as seen in the following examples:
• Starting up the application OpenWorks and loading in a dataset
typically takes 30 minutes. The customer’s agreement with the
software provider is based on the number of desktop counts, so
customer A won’t save money if the user logs out every night and
starts up the project again every morning. Charging by elapsed
time (without any filtering) may lead to counter-productive
behavior from the end-user, by losing 30 minutes of productive
work every day.
• A better approach is in this case to charge for distinct users.
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34
The Cost Centers
concurrency
and grouping
• Filtered
raw dataChargeback
distribute
Companies/
Legal Ent
Cost Centers
Software
Staff
Network
Servers
Facility
• Cost
process
values
cost
calculations
Cost Generators
Copyright © 2015 Open iT, Inc. All rights reserved.
• Invoices
Projects
Threshold
unique
ad-hoc filter
• PPU
values
Departments
• Raw
data
creating
invoices
User/Cost Center Hierarchy
•
We need to understand the current structure :
– Mapping from Users to Cost Center using Active
Directory?
– Or what about SAP HR?
– Do the costs centers belong to a division or Legal
entity, or are they across all? (1:M, or M:M)
– Are Project ID’s used?
Cost Center
Division/Legal Ent
P1-D-12341234
Production
D5-C-12341234
Design
Copyright © 2015 Open iT, Inc. All rights reserved.
Chargeback
• Types of agreements:
– Base only, fixed payment for access/service
– No base; only pay for usage
– Base payment includes “free” usage up to a
limit; only pay for extra usage
• Usage is metered
as a function of:
– Elapsed time
– # of distinct users or
devices
– # of concurrent
users or devices
– Combinations
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O
p
e
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i
T
,
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n
c
.
A
ll
r
i
Update the Cost Catalog
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1
Update the Cost Catalog
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1
Sample Invoice
A sample of an auto
generated invoice
Invoices emailed at
regular interval,
typically once a
month. We advise
excel or .pdf
attachments or a
link to SAP (BAPI)
Copyright © 2015 Open iT, Inc. All rights reserved.
Sample Invoice
Copyright © 2015 Open iT, Inc. All rights reserved.
Benefits of IT Chargeback
•
•
•
•
Cost awareness
Recognition of the value
Resource flexibility
Understanding the complications and charges for
requesting an IT service
• Accountability
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1
IT Chargeback Takes You to a Higher Level
Better employee
productivity
Optimization and
negotiation power
Increased Resource
Flexibility
Stay Compliant
Better financial control
Copyright © 2015 Open iT, Inc. All rights reserved.
43
Eistein Fosli
Founder
[email protected]
Linda Cole
Director of Sales, Americas
[email protected]
For more information
visit our website:
www.openit.com
Copyright © 2015 Open iT, Inc. All rights reserved.
Q&A
44