Charge back to move forward

Strategies for chargeback can help progress growth, says Andy Hardy

Hardy: Automated usage reports can help charge back accurately

Business-critical data volumes continue to grow unabated, but for many UK companies IT spending is still being tightly controlled. This means that, for the budget-challenged IT director, the need to do more with less has become a harsh reality.

We are all used to juggling IT resources across departments, but a way to cut out this headache is to identify how different departments use available IT resources and then look at how they can be charged accordingly.

An IT chargeback system is a method of automatically accounting for technology-related expenses. It applies the costs of services, applications and equipment to the business unit that uses them.

This system contrasts with traditional IT accounting models in which a centralised department bears all the IT costs in an organisation, where those costs are treated simply as corporate overhead.

If division decision-makers perceive IT to be ‘free’, they will be unable to account for the true cost of business investments and activities. Furthermore, there will be a lack of incentive to make the most efficient use of IT resources.

In my opinion, IT managers, who face potentially unlimited demands for IT resources, often become the champions of chargeback strategies.

Within data storage, where organisations worldwide are facing unprecedented growth, these strategies are particularly relevant. IT departments can rely on automated usage reports to accurately charge back costs to individual business units.

Storage-based chargeback, for example, associates actual storage usage with individual business departments to enable enterprises of all sizes to recover their storage costs.

Using tools that automate reporting for actual energy cost and carbon emission savings, companies may also gain access to precise data that may be used to support green IT initiatives.

This allows for increased datacentre efficiency and lower datacentre power consumption.

Andy Hardy is managing director of international sales at Compellent