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Chargebackhttp://clean-clouds.com

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Chargeback

What is chargeback? Mainframe ERA Objective Responsibility Accounting

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Traditional Environment

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Virtualization and Private Cloud

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2 Factors + New Technologies

Resource Metrics+

Excess capacity handling

De Duplication Server virtualization is leading the way

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Implementation Steps

Needs of Business Benefit from a chargeback system Objective Implementation Cost Evaluating S/W

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Chargeback Policies

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Challenges

Difficult to manage Virtualization De Duplication

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Chargeback in the context of Virtualization

Separate infrastructure costs from services costs Unit costs change over time Use tiered pricing Bundling is a necessity

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SaaS

Periodically Subscription User Based Subscription Usage Based Subscription Volume Usage Based Function Based Subscription Other Types of Billing Options

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PaaS

User Based Subscription Periodically Subscription Per User-session-hour Based Subscription Per Login Pricing Usage Based Subscription Group based Subscription Module based Subscription

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IaaS

On-Demand Instances Reserved Instances Spot Instances Data transfer based subscription Usage Based Subscription

◦ PUT, COPY, POST or LIST - $0.01 per 1,000 requests◦ GET and anything else - $0.01 per 10,000 requests

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Factors to Consider

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Key Chargeback Functions

Data Collection Functions Account Table Maintenance Rate Setting Billing & Reporting Administrative functions

◦ Budgeting Activities◦ Pricing Decisions◦ Usage Variance Analysis Requests◦ Business General Ledger & Accounting◦ Cost Allocation Decisions◦ Capacity Planning & Usage Trending◦ Activities

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Successful chargeback model

Organizational Alignment Business stakeholders Roles and Deliverables Defined SLAs

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Features

Chargeback Software Selection Configuration versus Utilization Costing Strategies Fixed Versus Variable Cost Elements Unused or Idle Resources Overhead Resources Shared Resources Systems Software Customization Scope of Processing Costs Manual Services Variable Charge Rates Variance Analysis Charge Penalties

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Benefits

Cost awareness Recognition of the value Resource flexibility Transition from a cost center to a value center Redefine itself as a service provider Lengthy customized Service Level Agreements -> standard

service catalog Understanding of the complications and charges for requesting an

IT service in IT Users Accountability

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Disadvantages

Implementing and maintaining IT chargeback systems is a daunting task.

Comparisons to commercial service providers Comparisons to commercial service providers Potential to erode the IT-customer relationship

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Different Chargeback Models

No Chargeback Non IT based Chargeback IT based Chargeback Direct Chargeback Profit-oriented pricing Fixed Revenue Fixed Revenue within predefined range Subscription Pricing Peak-Level Pricing User-Based Pricing

Ticket-Based Pricing Virtual Server Count Based Pricing Resource consumption Based Pricing Static capacity-based Based Pricing Hardware Based Pricing Flat rate Pricing Hybrid Model based Pricing SOA Transaction Ratio Funding Activity Based Pricing

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Possible Approach

Build a “best practices” chargeback process. Develop a chargeback requirements document. Evaluate and select chargeback software. Implement the chargeback software. Build a finance and chargeback support team dedicated to IT

management.

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Download with Linkedin Username/Password

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Download with Linkedin Username/Password

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Download with Linkedin Username/Password

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Download with Linkedin Username/Password

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Download with Linkedin Username/Password

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Thank You