Management of Unit Costs
Inform decision-making regarding unit cost adjustments — for example, those relating to pricing and consumption.
Improvement Planning
Practices-Outcomes-Metrics (POM)
Representative POMs are described for Management of Unit Costs at each level of maturity.
- 1Initial
- Practice
- Rely on the best endeavours of available personnel.
- 2Basic
- Practice
- Electively adjust some unit costs based on budget performance analysis.
- Outcome
- The IT function is able to adjust budgets, increasing flexibility.
- Metrics
- % of projects that meet their IT budgets.
- # of changes to project budget per quarter.
- $ value of changes to project budget per quarter.
- Practice
- Use budget performance analysis occasionally to inform on key consumption.
- Outcome
- The IT function is able to adjust budgets based on consumption data.
- Metrics
- % of projects that meet their IT budgets.
- # of changes to project budget per quarter.
- $ value of changes to project budget per quarter.
- 3Intermediate
- Practice
- Make periodic adjustment of unit costs due to budget performance analysis.
- Outcome
- There is periodic increase/decrease of unit costs via a consistent process.
- Metrics
- % of projects that meet their IT budgets.
- # of changes to project budget per quarter.
- $ value of changes to project budget per quarter.
- Practice
- Regularly use budget performance to inform on key consumption and pricing.
- Outcome
- There is periodic increase/decrease of unit costs via a consistent process.
- Metrics
- % of projects that meet their IT budgets.
- # of changes to project budget per quarter.
- $ value of changes to project budget per quarter.
- 4Advanced
- Practice
- Continually adjust unit costs based on IT budget performance analysis impact.
- Outcomes
- There is continual adjustment of unit costs.
- Analysis is used to continually increase/decrease unit costs.
- Metrics
- $ cost savings identified per quarter.
- $ cost savings achieved per quarter.
- Practice
- Use IT budget performance analysis when agreeing on consumption and pricing with the rest of the business.
- Outcome
- Analysis is used to continually increase/decrease unit costs.
- Metrics
- $ cost savings identified per quarter.
- $ cost savings achieved per quarter.
- 5Optimized
- Practice
- Use budget performance analysis to optimize unit cost management for business value.
- Outcome
- Budget analysis is used to identify opportunities and optimize unit cost management decisions for business value.
- Metrics
- Total $ saved by BOP team.
- Total new revenue enabled by BOP team.
- Practice
- Use budget performance analysis to inform key consumption, and optimize pricing decisions for business value.
- Outcome
- Budget analysis is used to inform key consumption, and optimize pricing decisions for business value.
- Metrics
- Total $ saved by BOP team.
- Total new revenue enabled by BOP team.