1. Copyright 2012 Pemari Consulting Ltd.
Service Financial Management
Peter Hughes - Pemari Consulting

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Background
• CA Clarity PPM was implemented in 2006
• Currently 450 active users and growing
• Global implementation with users in UK, Italy & Sri
Lanka

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Why Service Financial Management?
• Business Units didn’t understand what made up IT
costs
• IT struggled to communicate costs in a way that the
rest of the business would understand
• Finance’s cost allocation processes were crude and
often questioned
• Difficult to drive IT efficiencies if you can’t
understand how IT is being used and how much IT
costs….

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Service Financial Management Principals
• Business units are supported by a number of IT Services
• Each of these services have costs associated with them,
either direct costs or indirect costs
• All IT costs must ultimately be justified by the business
units that consume them. Therefore a cost of service will be
communicated to business owners so that product
profitability becomes clearer
• Cost allocation will be transparent and fair i.e. the
underlying charges that make up the cost of IT services and
the basis of allocation will be visible/made available

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How did we do it?

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Where do you start?
• Get the backing of the board
• Inventory of services
• Understand the cost allocation process

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Service Allocation Matrices
IT Business
Service
BS3BS2BS1

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Service Allocation Matrices
Platform &
Support Service
IT Business
Service
BS3
UK Platform
Global
Platform
BS2BS1

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Service Allocation Matrices
Technical &
Support Service
Platform &
Support Service
IT Business
Service
BS3
Global
Production
Application
UK Platform
UK Production
Application
SAN
Global
Platform
BS2BS1

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Service Allocation Matrices
Technical &
Support Service
Platform &
Support Service
IT Business
Service
BS3
Global
Production
Application
UK Platform
UK Production
Application
SAN
Global
Platform
BS2BS1

11. Copyright 2012 Pemari Consulting Ltd.
Service Allocation Matrices
Technical &
Support Service
Platform &
Support Service
IT Business
Service
BS3
Global
Production
Application
UK Platform
UK Production
Application
SAN
Global
Platform
BAM
TAM
BS2BS1
80% 20% 15% 85%
100% 20% 15% 100%

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Allocation Matrix Drivers
• The Business Allocation Matrix (BAM) used these drivers to
split costs:
– HR Data
– Trade Volumes & Revenues
– No. of Desks
• The Technical Allocation Matrix (TAM) used these drivers to
split costs:
– Storage Usage
– Backup Volumes
– License Usage
– Server Numbers
– Rack Space

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Projects
Trading
Project
Services
Cost Collection
Non-Labour
Costs
Labour Costs
Trading SAN
Trading
Production
Application
Trading
Development
Application
100%

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The Output – Statement of Services
• Drillable report containing all of the Service Hierarchy
including projects, forecasts and costs (Labour & Non-Labour)
• <<REPORT SCREENSHOTS REMOVED>>

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Timeline & Benefits?

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Timeline
2011 Dec
Feb
2012
Apr Jun Aug Oct Dec
Feb
2013 2013
Today
Go Live - Service
Management (Sri
Lanka)
1/3/13
Go Live - Service
Reporting for ExCo
11/2/13
BAM & TAM Complete
for Sri Lankan Services
28/1/13
Present Service Reports
to ExCo
17/12/12
Q2 Service Budget
Values Loaded into
Clarity
10/12/12
Upgrade - Clarity v13.1
22/10/12
Go Live - Service
Reporting for
Finance
17/9/12
BAM & TAM Complete
for Italian Services
3/9/12
Q1 Service Budget
Values Loaded into
Clarity
2/7/12
BAM & TAM Complete
for UK Services
1/6/12
Go Live - Project
Reporting
14/5/12
Go Live - Service
Timebooking (UK &
Italy)
1/4/12
Services Created in
Clarity
1/4/12
Service Inventory
Complete
28/2/12
Go Live - Financial
Integration
18/2/12
Kick off Service
Management
1/12/11

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Benefits so far
• Business Units can understand if their products and services
are profitable.
• Business Units can also understand easily see where IT money
is being spent and can how business decisions might influence
that spend.
• IT value can be justified
• The service reports have enable more accurate budgeting of
IT costs for each business unit
• Auditable intercompany charges for subsidiaries can be
determined

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Questions

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Contact
• If you have any questions feel free to contact:
Peter.hughes@pemari.com