IT Service Financial Management
The person in charge of the process of Financial Management does not necessarily have to be a member of the IT organisation. It is, however, essential that he or she have a knowledge of IT services and/or that he or she be properly advised by specialists on points concerning the technology.
In order to be able to evaluate the Financial Management role it is necessary to establish specific performance indicators and clear criteria for evaluating success.
In particular, these may include:
- Does the organisation know the real costs of the IT services?
- Do customers perceive the pricing policy to be consistent and in line with the market?
- Do the people responsible for other IT processes collaborate with Financial Management?
- Is spending on IT services and infrastructure really aligned with business processes?
- Does the IT organisation operate as a genuine business unit?
The performance indicators should include metrics making it possible to evaluate if:
- IT spending is properly planned and budgeted.
- Cost and income targets are met.
- There is precise accounting of each service.
- The return on investments (ROI) in IT is known.
- The IT organisation is operating profitably.
Preparing effective internal management reports allows the performance of financial management to be evaluated according to the parameters described above and offers crucial information for the organisation as a whole.
In particular, the documentation produced should include:
- Accounting summaries.
- An evaluation of the efficiency of each of the IT services.
- IT investment plans based on the history of the business and forecast progress of the technology.
- Cost reduction plans for each service.