Every CIO wants to deliver more transparency into the costs of IT services, but the reality is that few have accomplished it. This issue has been around since the early days when multiple departments shared a mainframe and tried to figure out how to distribute the costs fairly. So why all the hype about chargeback now? Like many things these days, you just have to look up at the cloud. Most cloud service providers offer an itemized bill broken down by user and services consumed. This new-found transparency has enabled many companies to reconsider their polices for chargeback. Unfortunately, many are still falling into common pitfalls that kill their initiative.   

 

Some of the world’s most successful service providers and enterprises use NetApp® OnCommand® Insight to create robust, automated chargeback processes. Before we dive into to the NetApp solution, though, let’s look more closely into the pitfalls others have fallen into.

 

I interviewed experts here at NetApp who have been helping customers with their chargeback projects and distilled the information I collected into 5 steps, their common pitfalls, and how to succeed.

 

Step1: Collecting Data from Remote Locations

    • Common pitfall: Attempting to deploy agents on your devices to monitor usage will result in spending more time deploying, managing, and configuring the agents than you can ever justify.   
    • How to succeed: Use agentless collection in a distributed fashion using only APIs.

Step 2: Transmitting data to a central location

    • Common pitfall: If your data is stuck behind a security layer and you can’t get it out, there is no value in having collected it.
    • How to succeed: Take a security-friendly approach that can transmit data through security layers in a way that meets organizational policies.

Step 3: Applying your business rules

    • Common pitfall: Thinking that any chargeback software will know your business and automatically configure to your processes.
    • How to succeed: Choose a solution that enables you to easily create business rules for how you want to slice and dice the charges; for example, by person, customer, service, application, business unit, etc. You should be able to set the rules up once and then let the software execute and enforce them over time.

Step 4: Calculating costs

    • Common pitfall: Thinking that it’s easy to get the exact costs of your infrastructure in a format that can be easily digested and combined.
    • How to succeed: When possible, integrate with trusted sources of cost; for example, a SaaS bill, a cloud bill, a financial system. If you can’t integrate, settle for an estimated cost allocation. Choose a solution that combines these disparate costs into a common format.

Step 5: Generating a report and/or a bill

    • Common pitfall: You’ve made it! You have all the data you need. You just have to put it in a pretty report that everyone will love – and actually read. But you’re about to be frustrated by lots of people having ideas and standards and no one agreeing on format.
    • How to succeed: Prototype the report or bill early. Get feedback. Then move on to version1.0 of the report and be flexible to update it over time.

But why make the effort of automated chargeback? It seems like hard work, so what’s the payoff?

 

If you are an enterprise CIO, chargeback enables you to create services that compete against third-party providers and possibly save money at the same time. Knowing accurate costing helps you make better design and implementation choices, effectively trading off cost versus performance. Furthermore, automated chargeback enables you to scale your business with distributed operations while maintaining centralized control.

 

If you are a service provider, you probably have no choice. Creating bills is the lifeblood of your business,  and if you still have manual processes using spreadsheets, you are doomed in trying to keep up in the fast-paced world of the hybrid cloud. Manual processes are error prone and often create revenue leaks by missing resources that you could be charging for. Manual processes also lead to billing errors that cause customer disputes and can make passing audits a daunting task. Not to mention just plain time and labor wasted in adding up bills in spreadsheets.

 

If you’re a service provider or an enterprise CIO, here’s what NetApp OnCommand Insight offers in automating your chargeback processes:

    • Agentless discovery of your hybrid infrastructure with massive scale-out and very little overhead
    • Deployment architectures that are security friendly and span on-premises and the cloud
    • Ability to create custom annotations and rules that match your business
    • Normalizes diverse, multivendor information into a central data warehouse
    • Out-of-the-box reports that can be easily tailored

Discover how OnCommand Insight can help you improve transparency into the costs of IT services and create robust chargeback reporting today!

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Kurt Sand