IT managed services make up a sizeable chunk of any company’s operating expenses. After all, it’s virtually impossible to do business these days without a strong IT service management infrastructure. As IT’s role in enterprise continues to grow, cost transparency becomes increasingly important, as we explain in further detail below.
Why Cost Transparency is Important in IT Service Management
Value demonstration and competition in the Great Recession. Tough times force all businesses to slim down or be left in the dust. Chances are no department in your business has escaped close financial scrutiny. Internally and externally administered IT managed services are no exception. Cost transparency is vital to demonstrate the important role IT plays in an organization.
Additionally, cost transparency can hone a competitive edge by quickly communicating which IT managed services are central to business goals. Any wasteful or non-essential programs can be cut, leaving more capital for mission-critical strategic investments.
Increased complexity. Technological advances such as the advent of mobile computing technology, cloud-based storage, and virtualization have made cost transparency critical. Today’s IT leader is likely juggling dozens of SaaS agreements, outsourcing contracts, and software arrangements. IT service management is more complicated than ever before. Cost transparency is an anchor, mooring complex IT spending to business objectives.
How to Foster Cost Transparency in Your IT Department
Follow international best practices standards. There are several different IT standards, but the most widely accepted set is the ITIL (Information Technology Infrastructure Library) guidelines. Cost transparency is built into ITIL standards, which call for companies to create an inventory of their IT services as well as a database of technology required to carry out each service. If this process sounds too intense to be conducted in-house, consider arranging for an IT managed services provider to do it for you.
Consider applying prepackaged cost transparency solutions. Once ITIL standardization has organized your IT spending, think about using an automated cost transparency system for ongoing tracking purposes. IT cost transparency programs can categorize and report on IT costs related to labor, hardware, and software, data center costs, and much more. Ask your IT service management consultant whether this kind of cost-transparency solution could benefit your company.