IT Financial Management – And The Cloud

I’ve been relatively quiet for a while – for two reasons: (1) I’ve been making the rounds, IBM PCTY in various countries, Forrester analyst days, client meetings, etc., and (2) I’ve been doing some serious research because I’ve decided that it is time to revisit my IT Financial Management report from last year. Why?

First of all because the market is really heating up. Every client conversation these days sooner or later turns to IT Financial Management in general and how to better understand and manage the IT budget specifically. Secondly, I’ve come to the conclusion that there is an adoption s-curve for IT financial management similar to the one for business service management that I published a few years ago. See the Implementing BSM report.

Here is what I am proposing:

IT Financial Management

And last but by no means least, a few vendors have started to take the next logical step – taking IT Financial Management to the cloud. This is important because Cloud Financial Management offers the critical information that allows businesses to accurately plan, budget and gain cost control over their cloud computing spend. This is a discipline that, we believe, will become essential as cloud computing in its various guises (public, virtual private and private clouds) begins to dominate the business world.

Stay tuned for an update on who’s playing in that market. 


Every journey starts with a single step

I love the adoption s-curve model, and the stages of "understand cost > manage cost > manage demand." This is the path most of our customers are taking and it reiterates the need to get started with simple Cost Transparency today. A framework like this helps IT leaders see the path from where they need to start to the incredible value that can be obtained from Activity based costing, Demand Management and "Lean" operating processes. What we're seeing is that IT managers that take the first step start up that steep value curve in operational cost savings and better alignment with the business. And they are starting with understanding the TCO of their IT products and services and providing cost & usage transparency to the business. Wonderful analysis, Thomas. Thank you. Jeff Day, Apptio.

It is meaningful.

It is meaningful.