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International Institute of IT Economics

March 29, 2018

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BIIT: Business Intelligence is needed to run IT like a business

July 23, 2018

 

 

IT has looked into the mirror. Does it still see itself as a bunch of nerds? Not so much anymore. Increasingly, IT has recognized itself as a business process and further refined that to productize IT services (portfolio management, service catalog, ITaaS, ITBM, etc.). We find that, after decades of cultural and economic pressure, IT is starting to run itself as a business.

 

IT has been remolded as a business by the market forces that drive it to be competitive with commercial service providers. IT has been shaped by the consumerization and democratization of technology. IT has been both integrated into the business processes of the enterprise and is recognized as a business process in itself.

 

As a result IT has started to employ tools used in the other business functions for resource planning (ERP) customer relationships (CRM) and service management (ITIL) and financial management (ITFM). These applications have created an enormous amount of information about the supply and consumption of IT services.  

 

What we heard from ITFM professionals at the recent IT Financial Management conference was “we have lots of data, but no good way to put it together.” We also heard that the ITFM role was evolving from ‘accounting’ to ‘analysis’.

 

When these two issues merge, the logical solution is for business intelligence (BI) to be deployed for the IT function. BI is a mature technology that is used heavily in sales, marketing, and industrial analysis. BI has largely displaced reporting tools that are “hard-wired” and one-dimensional.

 

Gartner defines (BI) as “an umbrella term that includes the applications, infrastructure and tools, and best practices that enable access to and analysis of information to improve and optimize decisions and performance.”

 

The key to mining the data generated by multiple IT accounting sources (G/L,

Cost Centers Accounts, J/E, A/P, ITFM, ITAM, PMO time tracking, usage stats, etc.) is to integrate them into a BI compatible format, commonly called a data cube. Wikipedia defines a data cube as a “multi-dimensional ("n-D") array of values. The data cube is used to represent data along some measure of interest. Generally, any kind of axis can be combined with any other into a data cube.” In BI the data cube is combined with a visualization engine (e.g. Tableau, PowerBI) to create dashboards and other graphic representations of the data.

 

This powerful combination can enable the entire IT cost collection to be integrated and viewed on any axis. Do you want to know the fully loaded cost of your IT services? Do you need to assess the cost of a discrete workload? Are you doing vendor cost analysis? Do you need to compare your Windows and Unix costs? Do you need to drill down to show all the cost components of a service and perform some ‘what if?’ analysis. Do you need to manage your service portfolio to optimize supply, demand and business requirements?

 

At the TCO Alliance, we have developed an optimized IT cost data cube structure and front-ended it with a powerful visualization tool (Tableau). We can efficiently and cost effectively load your data onto this platform to provide BI for IT (BIIT).

 

But what if it is not enough to slice and dice your current cost data? Often you need to make projections of what these costs will be over an extended (1-5 year) planning horizon.  Our platform includes a standard capability called planning curves. These enable extended forecasts to be done in a consistent, flexible and visual manner.

 

But what if you need to develop alternate scenarios? We include a capability called Decision-Paks to assess the impact of change. This is essentially a line item analysis of which cost elements will increase (puts) and which will decrease (takes) in the new scenario. This can easily be performed for multiple scenario forecasts.

 

The beauty of the data cube is that is reusable, like a SpaceX booster. Once it is built it can launch multiple payloads. It also provides much more flexibility than software based solutions that are difficult to create and harder to modify to answer new or drill-down questions.

 

Our offering - Workload TCO Analyst is optimized for replatforming decisions, but is a fundemantally a universal BIIT tool.  Contact the TCO Alliance at info@iiievalue.com to discuss your IT cost challenges or arrange for a demonstration.

 

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