Discover your true IT spend and make smart decisions for your organisation

Presented by: Paul ClaytonJisc Financial X-ray lead accountant

Agenda

»IT costs and typical issues facing IT decision-makers»Outline of the Financial X-ray service and process »Details of deliverables (Management report and

elements therein)»Current status update – HE, FE and FE Area Reviews»Summary

2/03/2016 Discover your true IT spend and make smart decisions for your organisation


Current financial challenges facing IT decision-makers

»Q: understanding of how much IT services really cost»Q: understanding of how much IT service cost is

incurred outside of the IT department (spend with suppliers, and also staff time)?

»Q: transparency of IT spend across the organisation?»Q: can you establish an appropriate level of spend on

IT services?»Q: is the budget the only measure of financial

performance?»Q: sufficient information for strategic decision-making?2/03/2016


The financial x-ray methodology

»A standard taxonomy or ‘catalogue’ of 43 IT services and platforms, developed by Jisc and HEIs, and 30 for FEI*

»Total absorption costs: pay and non pay and overhead»Activity based costing: analyses of pay and non pay»Covers central and devolved IT costs, and possibly TNE

sites»Benchmarking against peer institutions on a like for

like basis

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View of staff time (cost) allocated to the IT services

Direct staff costs – split devolved vs central costs across all 43 taxonomy categories

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View of staff time (cost) allocated to the IT services

Direct non-pay costs – split of devolved vs central costs across all 43 taxonomy categories

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Breakdown of costs borne (a) for staff and (b) non-staff

Driver table for graph


DRIVER TABLE FOR GRAPHTaxonomy category basic central Less income Central basic devolved Less income Devolved SumData Centres (compute, DC network, storage, cooling etc) 800,000£ 800,000£ 150,000£ 150,000£ 950,000£ Printing, Photocopying and Scanning 400,000£ 400,000£ 400,000£ 150,000-£ 250,000£ 650,000£ Workstations in research settings 3,000£ 3,000£ 500,000£ 500,000£ 503,000£ Networking, campus-wide, wired and wireless 325,000£ 5,000-£ 320,000£ 75,000£ 75,000£ 395,000£ Library Management -£ -£ 300,000£ 300,000£ 300,000£ HR and Payroll Management 50,000£ 50,000£ 200,000£ 200,000£ 250,000£ Financial Management Information System 100,000£ 100,000£ 200,000£ 200,000£ 300,000£ AV Services (incl. learning space support, studios, photographic) 200,000£ 200,000£ 75,000£ 10,000-£ 65,000£ 265,000£ Workstations in general teaching and learning settings 175,000£ 175,000£ 150,000£ 50,000-£ 100,000£ 275,000£ CRM for Student Recruitment -£ -£ 250,000£ 250,000£ 250,000£ Telephony (traditional and mobile) 10,000£ 10,000£ 250,000£ 250,000£ 260,000£ Virtual Learning Environment 150,000£ 150,000£ 50,000£ 50,000£ 200,000£ Information Security Services 125,000£ 125,000£ 50,000£ 50,000£ 175,000£

IT platforms that enable IT services

»End-users do not interact with platforms directly

» IT platform costs must ultimately be absorbed into IT service costs, or ‘customer-facing IT services’

»We can provide the full annual running cost of your data centre

Cost of IT platforms


Summary of costs borne

Click to icon to add image


Top-level IT costsData source £ Sub-totals £

DIRECT COSTS OF CENTRAL IT1 All Central IT staff - total cost incl NI + Superannuation Actuals £2,900,0002 All Central IT non-staff spend Actuals £2,850,000

£5,750,000DEVOLVED / DEPARTMENTAL / FACULTY / DIRECT IT COSTS

3 All departmental staff working on IT technical service catalogue Actuals £1,300,0004 All IT non-staff spend outside Central IT Actuals £3,100,000

£4,400,000INDIRECT / OVERHEAD COSTS OF CENTRAL IT

5 Apportionment of organisation-wide running costs for energy & cooling6 Apportionment of organisation-wide space & estates costs7 Apportionment of other general organisation-wide overheads Janet benchmark or estimate 1,300,000£

£1,300,000INCOME11 Income (from external sources only) -£250,000 -£250,000

---------------------TOTAL IT SERVICE COSTS £11,200,000 £11,200,000

Checksum OK

Total pay costs £4,200,000Total non-pay + overheads £7,250,000Total income -£250,000

---------------------Total costs £11,200,000

Headline costs for delivering IT services

»“How much of our IT spend has a direct bearing on our students’ experience?”

»“We didn’t realise it was costing so much”

»“We didn’t realise our peers are investing much more”2/03/2016 Discover your true IT spend and make smart decisions for your organisation


Current status update

»23 HE institutions have had the Financial X-ray service at least once

»Four FE institutions have been piloted for the service »A new, tailored X-ray for FE consultancy model is now

available»A self-assess ‘Financial Insight Review’ model is to be

provided to support FE Area Reviews, merging institutions being key beneficiaries. Rolling out during March ‘16

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Financial X-ray service, in summary..

»Activity based costing of IT service and platform costs, for resource allocation and budgeting

»May help with business case for more IT budget, for a different allocation of existing resources, or strategic change

»A standardised service catalogue and process permits benchmarking

»Collaboration with Finance and IT colleagues is essential as they hold the data needed

»The service has been tailored to meet the needs of FE and Area Reviews

»Jisc performs the detailed analysis, thus containing time input from your institution to a fairly low level

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jisc.ac.uk


Questions?

Contact details

Paul ClaytonFinancial X-ray Lead [email protected]

2/03/2016

mailto:[email protected]

http://www.jisc.ac.uk/

Discover your true IT spend and make smart decisions for your organisation - Jisc Digifest 2016

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