MANAGED SERVICES - Cost Visibility

UTILITY SERVICES - Cost Visibility

Classic IT Scenario: Purchase Cost of actual goods is the only visible cost factor. Business owners get extensively involved in the procurement stage of the technology solution.

Advantage: Looks inexpensive at the time of purchase.

Disadvantage: Cost of ownership often far surpasses the initial purchase cost leading to higher overall cost. Unpredictable cost expenditure for businesses as all purchases are unplanned, leads to uncontrolled spending.

Managed Services Scenario: Purchase Cost of goods and cost of ownership are the two main factors of visible costs. Business owners continue to get extensively involved in the procurement stage of the technology solution.

Advantage: Better cost visibility in the ownership of a technology solution.

Disadvantage: Deployment cycle is still long as the time to come to a decision to actually purchasing the solution remains at an average of 12 - 16 months from conception to deployment. Long deployment processes means potentially lost opportunities capitalized by competitors.

Utility Services Scenario: The appropriate technology service is delivered to the business owner as a complete service in a metered service "Pay-for-what-you-use" billing format.

Advantage: The metered rate represents the Total Cost Visibility per unit of the solution delivered to the business owner. Increase speed to market with quick deployment of advance technology services. Capitalize on revenue opportunities before your competitors. Allow businesses to focus on revenue generating initiatives instead of technology operations.

Disadvantage: Yet to be determined.