How do you justify your IT costs, define value, and allocate time effectively? For many IT organizations, these questions are not easy to answer. That’s why businesses turn to IT Financial Management (ITFM) solutions to align IT initiatives with customer needs, business outcomes, and corporate goals.
For many organisations implementing an ITFM solution is the answer, but not all ITFM solutions are the same.
While many promise efficiency and insights, they often fail to deliver value due to complexity, poor integration, and extended implementation timelines. The biggest culprit of this is an overly complex cost model which has many allocation rules and mappings in an attempt to create accuracy.
IT Financial Management practices fail when they fail to automate, fail to integrate, and fail to educate. At the core, that failure is fueled by cumbersome cost models that don’t mature with the business and always lead to more questions than answers.
A cost model is only as good as the data used and available.
All ITFM solutions have to import financial data from a general ledger. Operational data is required to create cost allocation rules and mappings have to be sourced and ingested by a cost model. Without accurate and timely operational data, the credibility of a cost model is undermined and the results questionable.
Building, and maintaining, a cost model can be a daunting task. A strong, scalable cost model requires data to flow in a certain way as defined by the data and the configured rules. In most instances, building a cost model requires some technical knowledge not easily available in the market. This can create dependencies on individuals or external delivery teams. Where training is available it may also be a very steep learning curve for individuals.
To complicate matters further, with a projected 9.3% increase in global IT spend for 2025, if your cost model solution is priced based on Technology spend then you’re in for huge price hike. A better alternative is a flat fee, platform-native end-to-end IT Financial Management solution magnifying the ROI of your strategic platform.
Because most IT Financial Management solutions are not built on an enterprise service management platform––like ServiceNow, you are left doing acrobatics trying to explain the value IT delivers.
When your ITFM/TBM solution is not built on-platform, you have two options: ingest data manually––which creates a risk of timeliness or building a datalink for each data source––each of which must be tested and maintained.
If your cost model sits on a service management platform this speeds up the model build increasing time to value and reducing manual processes, implementation time and cost. By having real time access to the operational data, it’s easier and quicker to refresh your cost model.
Reduce dependency on specialist skills and return power to the users by choosing a solution built on-platform; a solution with guided set up to create a model, cost allocations and mapping rules.
Proven Optics’ suite of IT Financial Management applications is the only ServiceNow-native build solution to demonstrate IT value. Our solutions are right for organizations whose desired outcomes include a repeatable, sustainable, scalable & defensible process, predictable, data, & actionable insights. For those with growing and maturing ITFM/TBM practices can expect reduced transition efforts and shortened implementation timelines.
