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Management of Unit Costs

B3

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.

2Basic
  • Practice
    Electively adjust unit costs in a limited number of circumstances based on IT budget performance analysis.
    Outcome
    The IT function is able to adjust budgets, thereby increasing flexibility.
    Metrics
    • % of projects that meet their IT budgets.
    • # of changes to project budgets per quarter.
    • $ value of changes to project budgets per quarter.
  • Practice
    Occasionally use IT budget performance analysis to inform discussion with other business units about their consumption of IT services.
    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 budgets per quarter.
    • $ value of changes to project budgets per quarter.
3Intermediate
  • Practice
    Consistently and periodically adjust unit costs based on IT budget performance analysis.
    Outcome
    There is a periodic increase or decrease in unit costs via a consistent process.
    Metrics
    • % of projects that meet their IT budgets.
    • # of changes to project budgets per quarter.
    • $ value of changes to project budgets per quarter.
  • Practice
    Routinely use IT budget performance analysis to inform discussion with other business units about their consumption of IT services and prices.
    Outcome
    There is a periodic increase or decrease in unit costs via a consistent process.
    Metrics
    • % of projects that meet their IT budgets.
    • # of changes to project budgets per quarter.
    • $ value of changes to project budgets per quarter.
4Advanced
  • Practice
    Continually adjust unit costs based on IT budget performance analysis.
    Outcome
    There is a continual increase or decrease in unit costs, as appropriate.
    Metric
    % of projects that meet their IT budgets. # of changes to project budgets per quarter. $ value of changes to project budgets per quarter.
  • Practice
    Use IT budget performance analysis as a basis for agreeing IT service consumption and pricing with the entire organization.
    Outcome
    There is a continual increase or decrease in unit costs, as appropriate.
    Metric
    % of projects that meet their IT budgets. # of changes to project budgets per quarter. $ value of changes to project budgets per quarter.
5Optimized
  • Practice
    Optimize unit cost management for business value based on IT budget performance analysis.
    Outcome
    Budget analysis is used to identify opportunities and optimize unit cost management decisions for business value.
    Metrics
    • % of projects that meet their IT budgets.
    • # of changes to project budgets per quarter.
    • $ value of changes to project budgets per quarter.
    • Total $ saved by BOP team. Total new revenue enabled by BOP team.
  • Practice
    Use IT budget performance analysis to inform levels of IT consumption and optimize pricing decisions for business value.
    Outcome
    Budget analysis is used to inform levels of IT consumption and optimize pricing decisions for business value.
    Metrics
    • % of projects that meet their IT budgets.
    • # of changes to project budgets per quarter.
    • $ value of changes to project budgets per quarter.
    • Total $ saved by BOP team.
    • Total new revenue enabled by BOP team.