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6fusion selected for Startup Hot Seat: Chosen to Pitch Ideas at Interop, Vegas

SAN FRANCISCO, March 26, 2015 /PRNewswire/ – Interop Las Vegas, produced by UBM Tech, today announced the participants for Startup Hot Seat, a unique opportunity for four enterprise startups to pitch their companies and solutions to the IT community. Focusing on the present and future innovations that will drive the IT community forward, Interop Las Vegas takes place April 27 – May 1at the Mandalay Bay Convention Center. For more information, visit: interop.com.

Startups are essential to the advancement of the IT industry. Interop’s Startup Hot Seat highlights four new companies in automation, big data, security, and resource management. A variety of innovative startups competed for the chance to take part in this exclusive opportunity. The four companies chosen will have eight minutes on stage to share new ideas, followed by a round of tough questions by an expert panel and conference attendees. Interop welcomes the following participating startups:

  • 6fusion: John D. Cowan, Co-Founder and CEO
  • Distelli: Rahul Singh, Founder and CEO
  • LaunchKey: Geoff Sanders, Co-Founder and CEO
  • Metanautix: Theo Vassilakis, Founder and CEO

Startup Hot Seat will take place Thursday, April 30, 1:00 – 1:45 pm. For more information, visit:http://www.interop.com/lasvegas/special-events/startup-hot-seat.

“Interop is honing in on the new ideas defining the future of tech,” said Interop General Manager Jennifer Jessup. “By inviting a host of the most promising startups to participate in special panels, discussions and informal networking opportunities, Interop aims to pinpoint the trends and technologies that will shape the next generation of enterprise solutions.”

Future of Tech
New to Interop Las Vegas, the Future of Tech program features the industry associations and non-profits implementing new standards across IT. Representatives from Open Networking Foundation, OpenCloud Connect/Metro Ethernet Forum (MEF) and more will share their vision and specific initiatives around open cloud, open SDN, vendor lock-in and more.

Open to all Interop attendees, the Future of Tech series will take place Wednesday, April 29 and Thursday, April 30. For the full schedule, visit: interop.com/lasvegas/scheduler/session-type/future-of-tech-session.

Even More Startup Sessions
Interop expands its focus on the exciting potential of new enterprise technology companies with two additional conference sessions. Within the Infrastructure and Applications tracks, respectively, these sessions take a deeper and more technical dive into areas where startups are driving true change.

  • The Bleeding Edge – Live Interviews With 3 Startups: Ethan Banks, Editor of Packet Pushers Podcast, will interview three young companies that are bringing new ideas to the enterprise IT space. Hear from Arkin Net, CloudGenix, and LightCyber about how they’re tackling difficult problems in network operations, security, and SDN. (Thursday, April 30, 4:10 – 4:55 pm)
  • David vs. Goliath: New Startups Driving Innovation: As networks become more dynamic and software driven, young companies are implementing positive change in all layers of the infrastructure stack. This panel will highlight lessons learned from the entrepreneurs in the trenches battling the industry giants. Participating companies include Akanda, Cloud Helix, Cumulus Networks and SocketPlane. (Thursday, April 30, 3:15 – 4:00 pm)

View these sessions as well as the full conference schedule here: http://www.interop.com/lasvegas/scheduler/list

The Interop Las Vegas 2015 conference program will be the most impressive in quality and size in the event’s history, growing by nearly 35 percent over 2014. Nowhere else in the country will the IT community experience such a robust schedule of panels, lectures and discussions. Interop also hosts an Expo of more than 300 solution providers, offering attendees a convenient way to see next-gen technologies all in one place.

Connect with Interop:  Twitter (#interop) |  Facebook  |  Google+  |  Instagram  |  YouTube

Register for Interop.
Apply for an Interop media pass.

About Interop®
Interop is the leading independent IT industry event dedicated to providing technology professionals with the unbiased information they need to thrive as new technologies continue to transform the enterprise. Part of UBM Tech’s family of global brands, Interop connects all levels of the IT community by showcasing the latest innovations and technologies while providing unique opportunities for networking and career advancement. Through in-depth educational programs, workshops, real-world demonstrations and live technology implementations in its unique InteropNet program, Interop allows attendees to gain insight into the future of technology, the outlook for the IT industry, and the possibilities of what it means to be in IT. Interop Las Vegas is the flagship event held each spring, with annual international events in India, London and Tokyo, all produced by UBM Tech and partners. For more information about these events, visit www.interop.com.

About UBM Tech
UBM Tech is a global media business that brings together the world’s technology communities through live events, online properties and custom services. UBM Tech’s community-focused approach provides its users and clients with expertly curated research, education, training, community advocacy, user-generated content and peer-to-peer engagement opportunities that serve the Security, Enterprise IT and Communications, Network Infrastructure and Applications, and Game and App Developers communities. UBM Tech’s brands include Black Hat, Dark Reading, Enterprise Connect, Game Developers Conference (GDC), GTEC, HDI, InformationWeek, and Interop. UBM Tech is a part of UBM (UBM.L), a global provider of media and information services with a market capitalization of more than $2.5 billion. For more information, go to http://tech.ubm.com.

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The Real Tragedy of Nebula’s Demise is Letting Them Die in Vain

By 6fusion CEO and Co-Founder, John Cowan

Nope, it was no April Fool’s joke.  Nebula, rather ironically, closed it’s doors on April 1st.

Cue the armchair quarterback postmortems.  As an entrepreneur and founder of a company it’s amusing to me to watch the so called experts dash for their blogs and twitter accounts to weigh in on the downfall of a big idea like Nebula.  It’s amusing because for the most part these experts have never taken the kind of professional or financial risk that Chris Kemp or I have taken. Until you do that, opinions on such matters are dramatically unfounded.

A post-mortem that I would recommend reading, however, is Ben Kepes, “OpenStack Carnage”. Ben closes his piece off by asking an important question that I want to focus on summarizing:

“What is interesting is what this means for the remaining players. Mirantis seems fine – it has the funding and the scale to survive. My real question is for Piston Cloud, it seems to me that they’re the last man standing, and not in a good way.”

Nebula’s inability to achieve success as an OpenStack startup holds the answers to Ben’s question. Understand this about the new market economics created by cloud computing: You are witnessing a transfer of power to the buyer in the traditional IT vendor/client relationship. The days of funding walled gardens and product isolation (affectionately called “product differentiation” by marketeers) are over. And just because the big vendors have hundreds of millions of dollars to hide the wounds doesn’t mean they are ANY better off than our friends at Nebula.

I am, and remain, a cup half full kinda guy when it comes to OpenStack. I spent a lot of time in this ecosystem in 2014 and even published my thoughts in Wired Magazine on the precipice of OpenStack Paris. But my bullishness was tempered with a simple warning for this community:

“OpenStack as a community must become an organized market that is a part of a bigger picture.”

I elaborated on my vision to make OpenStack a real deal threat in the cloud computing market, but really what this comes down to is giving customers of the modern economic era of IT what they need and want.   You see, commodity market growth (I can almost see the marketeers turning green!) is cyclical in nature and orbits the center of liquidity.

I am a firm believer that had Nebula focused less on “disrupting” IT and more on creating real economic relevance their fate would have been different.  And this is the lesson for the OpenStack players still living the dream.  Stop figuring out how to get “POC” installations in place and over-hyping the over-exaggerated geek features and start figuring out how to demonstrate why using OpenStack as the foundation of IT delivery makes more sense for the women that write the checks to Microsoft, AWS and VMware.

Going back to my publication in Wired, I remain steadfast that the answer lies in a world in which a buyer of any pro proprietary OpenStack distribution can quantify Total Cost of Consumption (TCC), compare that against an OpenStack public cloud pricing index benchmarked against non-OpenStack markets like AWS.

Lest we forget as we eulogize Nebula that reduced friction and increased transaction velocity are critical factors in creating liquidity.  The money goes to the robust marketplaces.

For the last ones standing, to paraphrase Ben, 6fusion is here to help.

6fusion Selected by AlwaysOn as an OnFinance Top 100 Winner

Recognized for creating IT Economic Transparency

 San Francisco, CA April 14, 2015 – 6fusion, the company standardizing the economic measurement of IT infrastructure and cloud services today announced that it has been chosen by AlwaysOn as one of the OnFinance Top 100 winners.  Inclusion in the OnFinance 100 signifies leadership amongst its peers and game-changing approaches and technologies that are likely to disrupt existing markets and entrenched players. 6fusion was specially selected by the AlwaysOn editorial team and industry experts spanning the globe based on a set of five criteria: innovation, market potential, commercialization, stakeholder value, and FinTech buzz.

 6fusion and the OnFinance Top 100 companies will be honored at AlwaysOn’s OnFinance event on April 30, 2015, at NASDAQ OMX, 4 Times Square, NYC, NY.  6fusion CEO and Co-Founder, John Cowan, will be presenting a company overview.

 This exclusive event gathers the brightest minds at OnFinance for a lively exchange on the top trends and most lucrative entrepreneurial opportunities in business, personal finance, and digital currencies.

 “The OnFinance Top 100 represents the best-of-breed of private companies in the b2b and personal finance, crowdfunding, payments, and digital currency sectors,” explained AlwaysOn founder and editor, Tony Perkins. “Given the growing demand by both consumers and Fortune 100 companies for new generation Fintech solutions, and the amount of investment dollars pouring into the space, the OnFinance Top 100 private companies are well positioned to be the fastest growing and most highly valued new companies on the planet.”

 The OnFinance 100 winners were selected from among hundreds of other technology companies nominated by investors, bankers, journalists, and industry insiders.  The AlwaysOn editorial team conducted a rigorous three-month selection process to finalize the 2015 list.

“Being recognized as an OnFinance Top 100 Winner is edifying,” said 6fusion CEO and Co-Founder John Cowan. “We are thrilled to be recognized for pioneering IT Economic Transparency, and taking a Utility approach to IT.”

A full list of all the OnFinance 100 winners can be found on the AlwaysOn website at www.aonetwork.com.

About 6fusion

6fusion is standardizing the economic measurement of IT infrastructure and cloud services, and  providing IT economic transparency to the global market.  With 6fusion’s UC6 Platform, organizations can view and manage the Total Cost of Consumption (TCC) of their business services in real time and achieve a higher level of cost optimization, forecasting accuracy and business agility.

6fusion uses a patented single unit of measure of IT infrastructure called the Workload Allocation Cube that provides a common view of IT consumption, agnostic of underlying technology or vendors. 6fusion enables baselining, benchmarking and budgeting of business service consumption across execution venues, and supports dynamic cost optimization strategies that keep pace with the realities of today’s heterogeneous, on-demand world.  For more information visit www.6fusion.com

About AlwaysOn

AlwaysOn is the leading business media brand connecting and informing the entrepreneurial community in the Global Silicon Valley. Founded by Red Herring founding editor, Tony Perkins in 2003, AlwaysOn’s mission is to continue to lead the industry by empowering its readers, event participants, sponsors, bloggers, and advertisers like no other media brand.

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Utility Methodology in Infrastructure Capacity Management

The goal of an organization’s Capacity Management Team is to ensure that IT services and infrastructure are delivered at agreed upon service levels in a cost effective and timely manner. Capacity Management must consider all of the resources required in order to meet the business requirements of every department that IT serves, and ensure that there is a sufficient supply to meet those needs.

The manner in which some organizations conduct Capacity Management and Planning today presents significant risks (and opportunities) to the business, particularly because, as Gartner asserts “every company is an IT company” now. The process typically involves a large amount of manual data gathering, and limited visibility into actual usage of resources. Even large organizations with massive IT departments typically have have to make broad assumptions about the growth rates of particular users and applications due to a lack of clear insight into actual consumption and growth. Often, there’s just one person responsible for figuring out how many servers are needed – in what configuration and from which sources – who pulls all of this data together.

For most organizations, there is a lack of actual usage data and consumption patterns involved in processes for planning, tracking and acquiring infrastructure.

What can organizations do to improve this process and forecast, budget, and acquire infrastructure aligned with actual usage? As mentioned in our recent blog, 6fusion’s WAC provides detailed measurement at a granular level based on actual consumption patterns and usage trends. With the WAC, organizations can see which components will run out of capacity first and what type of mitigation plan is needed to avoid hitting that threshold. More storage, more memory, more servers? Using the WAC will enable you to determine the exact configuration you should purchase to eliminate costly wasted resources.

WAC_logo__primary.jpg

This consumption based baseline provides organizations with:

  • An understanding of capacity usage and future needs

  • Visibility into most cost effective alternatives, be that internal or external

  • More accurate quotes from vendors

Take a recent 6fusion case study involving an international educational institution with hundreds of machines that were coming to an end of life as an example. They needed to make a decision on the most cost effective way to replace these machines based on current utilization patterns and expected growth over the next three years. 6fusion was able to provide them with several different scenarios and projections based on their detailed consumption patterns and anticipated growth. The institution was able to take their exact specifications to hardware vendors to get more accurate quotes for what they actually needed, versus what the vendors were trying to sell them. When moving to the cloud is an option, this data can also be used to make intelligent decisions around the costs of internal versus external hosting.

The benefits of the WAC don’t stop at the point of infrastructure purchase. Once 6fusion is implemented, organizations can then track total capacity across all infrastructures, as well as capacity per infrastructure. This provides visibility into specific resource consumption and bottlenecks. The net gain is greater infrastructure efficiency, and a hard dollar cost savings. There are also soft benefits, like transparency into the costs associated with a given service, which can then be compared to the value that service delivers.

It’s a way for IT organizations to show they are running IT as a business and demonstrating true value. 6fusion helps your Capacity Management team meet the business demands of their internal clients.

Want to learn more about Infrastructure Capacity Management and the tools your IT organization will need for the future?  Follow us on twitter @6fusion and learn more about IT Economic Transparency.

4 Key Questions to Improve your IT Infrastructure Decision-Making

New infrastructure deployment models, such as public cloud and hybrid cloud options, have appeared over the past decade. The result has been organizations moving some or all of their infrastructure and application portfolios to the cloud with the assumption that they’ll save a significant amount of money. However, most of these organizations aren’t building solid business cases up front and as a result, aren’t tracking actual results following the change in their infrastructure footprint. There are three primary inhibitors for tracking costs and optimizing performance:

  1. Lack of visibility across heterogeneous infrastructure environments – When an organization looks across all of the infrastructure they are currently using, most find a highly diverse mix of public, private, hybrid, and legacy systems, which are running different technology stacks and using different operational models. This makes getting a complete understanding of total capacity, utilization rates, costs, and usage patterns extremely challenging.

  2. Lack of transparency in infrastructure pricing and cost – In addition to understanding capacity and usage, the lack of transparency between the pricing and cost of on-premise infrastructure and cloud service providers adds even more ambiguity to the decision making process. Try comparing the usage and costs of an on-premise VMware environment with any number of cloud service providers. It is not a trivial task.

  3. Vendor TCO models lack credibility and comparability – Almost all infrastructure vendors have their own version of a TCO model, but the “I’m from [insert vendor here] and I’m here to help” model is not working. Not only do vendor TCO models lack credibility (funny how the vendor that comes out looking best in any given TCO model is highly correlated to the vendor that created the model), but they also lack comparability. You can’t take a VMware TCO and compare it directly to Microsoft, AWS, or any other vendors’ TCO analysis.

6fusion created the WAC to help companies make better IT decisions and overcome the three key stumbling blocks above. In recent blog articles, we outlined a step-by-step primer to baselining and benchmarking your IT infrastructure. Once an organization has their baseline and some level of benchmarking, they often look at optimizing the cost:performance efficiency by moving some of their workloads or applications to alternative infrastructures, internally or externally. But which infrastructure options are going to best meet your needs? Here are the four key questions to answer to improve your infrastructure decision-making:

 

 

  1. What are my costs now? As we’ve discussed in previous baselining blogs, it’s critical to understand your existing unit cost efficiency based on your current infrastructure capacity, consumption patterns and costs.

  2. What could the costs be? You need an apples-to-apples comparison of your costs to other options in the market, whether that’s additional on-premise infrastructure, a cloud service provider, or a hybrid of the two.

  3. What is everyone else paying? Ideally you’d like to know what others in the market are paying. Not the list prices, but what do other organizations like yours actually pay and what is their infrastructure cost efficiency.

  4. What are my costs after I make a move? Once you know all the of the above information and you make a decision to optimize your infrastructure footprint in some way, after that change is made you need the ability to track forecast-to-actual cost efficiency. In other words, am I improving as expected, and what are the next steps for further improvement (or additional course correction)?

Answering these questions will radically improve your infrastructure decision-making and put you on a path toward the optimal mix of cost and performance across your entire infrastructure footprint. We’ll talk in future posts about some specific examples of organizations that have used this methodology to transform their infrastructure decision-making processes.

Need to improve your infrastructure decision-making? Contact us at info@6fusion.com or follow us on twitter @6fusion to learn more.

 

5 Tips for landing a job at a top tech startup

By Jocelyn DeGance Graham, SVP Market Development

I’ve spent the last several years immersed in startups and startup culture, helping companies grow their thought leadership, increase their brand awareness, get accepted into prestigious startup incubators, and raise capital. What I can say with absolute certainty is that the tech startup market is exploding, and there’s no better time to jump in, especially if you are based in one of the major tech centers like Silicon Valley, Seattle, Portland, or Research Triangle Park (RTP).

Searching for a job at a top startup is NOT the same as looking for a position in Enterprise. First, if you are applying for the job by sending in a resume, your time is probably better spent catching up on Game of Thrones.  Second, you need to be conducting a very targeted campaign– notice I said ‘campaign’– not search.  Securing a position with a top startup is an activity far more similar to running for office than looking for your car keys.

In the same way that the startups you are targeting are laser focused on creating a brand, you need to be doing the same with them, creating the brand of You. Like it or not, this is the reality. In my current role for example, I was hired because my company kept on running into my clients and when asked “who does your marketing” they came across my name. That’s the kind of recognition you are looking to achieve.

So whether you are seeking a technical or business role, here are a few tips that will radically improve your chances of landing the killer role, and set you apart from the other candidates:

  1. Develop your brand.  How are you going to get a startups attention if they’ve never heard of you? Take advantage of all the online tools — be an avid tweeter (of industry / professional topics), start a blog, create a website, reachout to thought leaders and write articles about them, contribute your code, etc.

  2. Network with the VC firms.  Often times VC firms have an HR resource dedicated to hiring at their portfolio companies.  Get to know these people, take them for coffee, and develop these contacts. The portfolio hiring managers are always highly networked individuals, and even if they don’t have something now, you’ll want to stay on their radar.

  3. Have passion. Your belief that your startup will be the next Google must be 99.9%. I met one woman who got the logo of her startup tattooed on her inner wrist. If you can’t find a startup you feel that passionately about, go back to Enterprise.

  4. Go to industry events.  Get out of your sweats and interact with people…in person.  For those of us in the SF Bay Area, there is no end to the events, forums, conferences, and meetups that are available.  If you live in a city without this kind of activity, consider creating your own meetup.

  5. Stay classy.  Ultimately, if you don’t get the gig be gracious. The people who are in the startup game are addicted to the lifestyle, and so you will be interacting with the same people for the next decade or more of your career.  Sometimes you’ll be the one looking for a job and other times, you’ll be the one offering the job.  This is one case in which I agree with Microsoft CEO’s Satya Nadella advice to let ‘karma’ play itself out.

Now get out there and find the next Google!

 

 

A view from the Ingram Micro Cloud Summit: Women in Tech–what’s holding us back?

Recently, I spoke at the Women of the Cloud Forum in Phoenix, hosted for the past three years as part of the Ingram Micro Cloud Summit. The session focused on the status of women in technology and cloud.  Joining me in the discussion were Gina Mastantuono, Executive VP, Finance, Ingram Micro; Lynn Jolliffe, Executive VP, Human Resources, Ingram Micro; and Khali Henderson, Senior Partner, Buzz Theory.

Our session kicked off with a ‘scorecard’ for how the industry is doing in advancing the agenda of women in tech, and to ruin the punch line, it’s bleak–surprise!

Taking a meta view across studies and research, the number of women in executive roles is approximately 20%.  Much has been written about the external barriers and factors for this, but in my opinion, after almost four years at the helm of a women in cloud non-profit, and ten as start-up executive, the internal barriers that women place on themselves are far more detrimental than the flashy news generating headlines of the external barriers.

Don’t mistake me, I am not being a Polly-Anna and discounting discrimination, harassment, misogyny all of which is alive and well, as evidenced by high profile cases like Pao vs Kleiner Perkins; however, to only blame external factors, is just a piece of our collective story.

As I shared at the Cloud Forum, women are the only majority that act like a minority– we identify ourselves as minority, and have allowed ourselves to be treated as a minority. As Eleanor Roosevelt most eloquently stated: ‘no one can make you feel inferior without your consent’.

There has been much written about encouraging women to pursue studies in STEM (Science/Tech/Engineering/Match), in fact, my nonprofit is a staunch supporter of STEM for girls, and manages a scholarship fund; however, while I agree with Education as a key ingredient of this remedy, I also recognize that there is a bigger issue– what we have is an ‘ambition gap’.

A 2012, McKinsey survey of more than 4,000 employees at top organizations, found that 36% of the men had designs on reaching the CxO level, while only 18% of their female colleges expressed the same ambitions; meaning twice as many man to start with wanted these roles.  This ambition gap is replicable at all levels of the organization, and across generations with the similar findings for Millennials.  In Sheryl Sandberg’s Lean In: Women, Work, and the will to lead she references that author Samantha Ettus has shared anecdotally that in her child’s kindergarten yearbook when asked ‘what do you want to be when you grow up’, a good percentage of the boys reported, ‘President’, while none of the girls did.  Findings indicate that these feelings will persist for a lifetime, until they ultimately play out in the workplace.

Sure discrimination suits make the news, but for most women it’s the silent career killers of our own internal monologues that plague us and block us from pursuing our dreams. The Women of the Cloud Forum energized attendees to look within. While at the conference, I slowed down, took pictures, spoke with dozens of women, and reflected on the experiences that being (a woman) in tech has afforded me. I feel fortunate, and would do it all again.

My key take away from the Forum?– Yes, there’s barriers to succeeding in tech, both external and internal, but no one is responsible for managing your career except you– make it count!

OnFinance, Nasdaq, April 16 in NYC- 6fusion selected to speak

6fusion joins the world’s foremost thought leaders in FinTech at Nasdaq, April 16 at OnFinance.  Details on 6fusion’s session forthcoming.

http://aoevents.aonetwork.com/onfinance/2015/

More about the show: FinTech is a booming entrepreneurial opportunity in the global Silicon Valley. Join us for OnFinance 2015 in the financial capital of the world at NASDAQ’s headquarters in New York City. At OnFinance you will hear the hottest FinTech company CEOs make their pitch to top venture investors and business development executives from big tech and large financial institutions. AlwaysOn events are intimate and social networking friendly, where attendees easily find each other, share ideas and make it happen. If you have a stake in FinTech, you will not want to miss this private insider affair.

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Consumption, Not Configuration: The New Standard for Infrastructure Cost Allocation

There are many reasons IT organizations allocate costs by department, but the primary reason is to run IT as a business, aligning expenses with revenue to convert it from a cost center to a value center. Traditionally, departments are allocated or charged for IT services based on things like # of servers, # of VM’s, GB’s of storage or even worse % of spend by headcount; metrics that are not transparent and at times appearing almost arbitrary. Sometimes, politics even comes into play, with those in the strongest position receiving favorable chargebacks or allocations or improved methods at least.

With the emergence of new IT Financial Management standards and groups, a small number of organizations have begun tracking cost allocation by other methods, including server configuration. But even then, this basis is determined by the type and number of servers each department is using, and the total cost of those servers, not actual consumption of the critical business services the business operates. Increasingly the addition of external hosting and cloud have complicated these models due to their highly differentiated billing models.  Rarely are chargebacks based on what the departments are actually using or spending – the most accurate gauge for chargebacks. And that’s simply because most companies don’t have the data to support consumption-based cost allocations.

The difference between departments paying for the resources allocated versus the resources they actually consume creates the following inefficiencies:

  • Fixed-allocation models result in significant over-provisioning, which drives under-utilization and investment waste from unused resources.

  • Unused resources artificially drive up application hosting costs as waste, and must be amortized across active users.

  • Economic incentive for users is not aligned with the organization. When actual cost is not a direct factor in infrastructure choice, users will pick the best possible technical solution (without regard to cost) even though that cost/performance ratio may not be in alignment with the business goal for that particular organization.

  • Without actual consumption and cost data, or a common language, strategic planning within and across departments is virtually impossible.

  • There is no visibility for the head of IT or Senior Management on the reasons behind the costs of IT, or any ability to predict how that cost will change over time.

  • Strategic planning is virtually impossible as you can’t use mismatched historical data to predict the future, and you can’t compare to industry averages.

This gets back to a previous 6fusion blog comparing Total Cost of Ownership (TCO) vs. Total Cost of Consumption (TCC). TCO only tells an organization what they’re spending on infrastructure, not what they’re actually using. Even when TCO can provide cost estimates by department as noted above (not always possible with cloud deployment models), it lacks the detail to improve cost efficiencies or make accurate comparisons. But with the WAC, the standard unit of economic measure for IT, and TCC, organizations have an apples-to-apples comparison of costs across every available infrastructure. TCC enables companies to chargeback departments for actual usage, running IT as a business, and converting IT from a cost center to a value center.

Consumption-based cost allocation has become even more critical with the advent of cloud-based applications, because business units now have the ability to acquire applications services without IT. The pressure is on for IT to defend their costs and services and also be able to quickly and clearly compare and contrast internal and external services.

IT is moving towards a Utility Model– you’ll be paying for what you use, just like your electric bill. Leading edge organizations have begun to track cost allocation by consumption. This results in business units/users being able to match costs to the value they are receiving from IT in a transparent way. Those business units will also be able to effectively gauge project profitability resulting in improved business decision making. IT can respond to new demands with a fair price tag, instead of denying applications or resources due to budget constraints. And consumption-based chargebacks provide the detailed cost information needed to improve IT efficiency. It’s a win-win for IT and the recipients of their services.

Eventually, consumption will be the standard and best practice for infrastructure cost allocation, and we will all view IT just like electricity, gas, or water.

Follow us @6fusion and learn more about IT Economic Transparency and measuring your IT Consumption.

 

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