Strategic IT Service and Cost Model Design

CRG designs and implements strategic cost transparency across a public sector IT infrastructure shared services organization

BACKGROUND

A Public Sector IT infrastructure shared services organization lacked accountability, trust and transparency required to defend its service costing, pricing, billing, and recovery. This service provider delivers annually over $500M of Hosting, Mainframe, Storage, User Seat, Network Access Service, and Telecom services to 68,000 customers across various provincial Ministries and Clusters but was unable to define their offering and quantify the cost to deliver these services resulting in revenue leakage.  To no avail, several attempts were made previously over a number of years to develop and sustain a costing methodology across the organization that would gain client/stakeholder trust.

CRG was awarded the opportunity to design a tailored and sustainable IT infrastructure costing methodology and rebuild the trust between the shared services organization and their customers

CRG developed and implemented a simple and requirements driven componentized costing model that delivered the following:

• An end-to-end view of  how client-facing services are consumed and how much they cost to deliver
• Service consumption of activities and accurate linkage to expenditure consumption
• Activity cost transparency by department, activity, and service
• Improved ability to budget and forecast expenditures
• Management reporting capability across the organization
• Identification of material process improvement opportunities through lean activity analysis
• Ability to establish market relevance through Mark to Market and Benchmarking
• A sustainable solution managed and executed by the client independently on an annual basis
• Cultural evolution towards cost awareness and data driven decisions
• Credibility, trust and transparency between the service provider and their customers