Rationalizing socializing allocation_changes
-
Upload
thavron-solutions-llc -
Category
Business
-
view
43 -
download
0
Transcript of Rationalizing socializing allocation_changes
Thavron Biases
• Systems Thinking
• Universal Business Service Model
• Manufacturing and Supply Chain roots
– Lean (MESA Lean Manufacturing Strategic Initiative Guidebook author, Toyota Method via GM/Delphi)
• Modeling/Frameworks
• Common Sense
Copyright 2015 Thavron Solutions, LLC
Every Model is a Chargeback Model
IT costs impact everyone’s bottom line. This makes any change in IT costs important.
Copyright 2015 Thavron Solutions, LLC
What Causes IT Costs to Change?
Consumption changes
Data Changes
Model/Allocation changes
Copyright 2015 Thavron Solutions, LLC
The Business Changes their Behaviors
• Changes in headcount
• M&A/Divestiture
• New products
• Retiring products
• Changes in process
• …
Copyright 2015 Thavron Solutions, LLC
When the Data goes bad
• Data Linkages
• Data Structure
• Data Corruption
Copyright 2014 Thavron Solutions, LLC
Validate with monthly processes
• Regular governance processes
– Fallout
– Unexpected changes in source data
– Technical failure
– Include some feedback /corrective mechanism
Copyright 2014 Thavron Solutions, LLC
Every Model will Change
• Organizational Changes
• Philosophical Changes
• Infrastructure Type changes
– Not linkages in the data
• Service Lifecycle impact
• Fundamental changes in source data
Copyright 2015 Thavron Solutions, LLC
Not every change is an event
• Define what is a material event for your company
– Any change to budgeted charges?
– Percent Variance tolerance ( 3-5% common)
– Street impact measures
Copyright 2015 Thavron Solutions, LLC
When it goes wrong……
• Business loses confidence in:
– Model
– Team
– Process
– IT
Copyright 2015 Thavron Solutions, LLC
Pitfalls
• Didn’t really understand the old method
• Data changed between versions
• Don’t really understand the new method
• Model implemented wasn’t properly validated and was wrong
Copyright 2015 Thavron Solutions, LLC
The Ugly
• Tedious
• Financial Validations
• Time/resource intensive if the changes are extensive
• Excel will be your best friend
Copyright 2015 Thavron Solutions, LLC
The Bad
• Almost always time constrained
• Finance Team does not have expertise to validate model code logic
• People forget to budget for the staffing to test and validate
• Team has never built or executed test cases before
Copyright 2015 Thavron Solutions, LLC
The Good
Success Stories
– Change from no model , no services to implemented service costing
– Change from infrastructure only charges to Business Service charges
– Change from a “broken” model to “fixed” model
– Migrate from one vendor system to another
– Migrate from Excel to COTS package
Copyright 2015 Thavron Solutions, LLC
How to make it work
• Plan to Plan
• High level Plan before you budget
– How many moving pieces?
– Availability and Condition of the data?
• Be honest about the skills and capabilities of your own staff
• Leverage internal expert knowledge in IT System change where possible
• Training
Copyright 2015 Thavron Solutions, LLC
What do you need?
• Documented Use Cases for the system
• Test Cases that are adaptable to work for before and after
– If it is a full system change, will have to duplicate and update the test cases
• Validate both the model logic and the outcomes
• Have a plan and know what can be validated outside of the system
• Socialization with the consumers
Copyright 2015 Thavron Solutions, LLC
Socialization
• Communication Plan
• Communicate
• Share the end tie outs – no need to drag everyone through the mud
• Bundle it up and make it infrequent
Copyright 2015 Thavron Solutions, LLC
Keys to Success
• Clearly Defined Use and Test Cases
• Plan for Testing and Validation
• Know yourself and be honest about it
• Staff appropriately
Copyright 2015 Thavron Solutions, LLC
Discussion
Copyright 2015 Thavron Solutions, LLC
Follow up questions? Nan Braun [email protected] 765.252.4509 / http://thavron.com /@ThavronSol